The Social Security Scam That Tries To Trick You Into Fake Investments

If someone promises you bigger Social Security checks, or government-approved investment deals, that sound too good to be true — chances are good they are. Scammers pretending to be from the Social Security Administration often reaching out via emails that can look real, through social media ads, or even via phone calls with seemingly legitimate caller IDs. These scammers can create a sense of panic by threatening that your benefits will be suspended unless you pay them immediately. Ultimately, these tactics are all about pressuring you into making a quick, often regrettable decision.

The Federal Trade Commission (FTC) has flagged government imposter scams as a top concern, with Americans losing about $171 million in 2023 and $789 million in 2024. While specific data for Social Security scams aren't detailed out separately, the trend is still troubling. The SSA's Inspector General has even issued warnings regarding the surge in scams — especially fake tech support emails and text messages designed to earn a victim's trust. Retirees are often hit the hardest by these scammers, partly because digital safety isn't second nature to many. However, the latest scam plaguing retirees is something known as an investment opportunity scam, and scammers are using this tactic to entice retirees into investment opportunities by claiming these investments can boost their Social Security benefits or even just provide more income. These fake investments often require upfront fees and payment — which retirees will never get back.

According to the FTC's Protecting Older Consumers, 2023-2024 report, older adults reportedly lost over $1.9 billion due to fraud just in 2023 alone. However, the report also notes that many victims seldom report their experiences, making these crimes harder to combat. To put that into perspective, the FTC estimates that the amount that older adults actually lost to fraud in 2023 was probably closer to $61.5 billion. Retirees, who are often isolated but have steady income, can be prime targets for Social Security scammers. Scammers are increasingly using AI to mimic SSA representatives through voice cloning and even deepfakes — just some of the many AI-powered financial scams to look out for. By promising surefire returns or risk-free investments, these scammers hope to pressure victims to divulge sensitive information like bank account details and Social Security numbers.

These scammers can use a mix of cunning psychological tactics and technical tricks to dangle threats and promises in front of would-be victims. Since scammers generally prey on fear, some even pose as representatives of federal agencies or even law enforcement in order to wrongly accuse victims of wrongdoing. When it comes to Social Security specifically, fraudsters will often demand money in order to supposedly unfreeze a victim's benefits. These criminals often use encrypted messaging apps, burner phones, and fake social media accounts which can complicate any efforts to track them down. Not to mention the significant rise in cryptocurrency scams in 2024, which can be almost impossible to remedy given the irreversible nature of the payments.

To avoid falling into a fraud situation, ignoring unsolicited contact can be a great place to start. Remember that the SSA, or any federal agency, will never reach out via email, text, or phone to ask for personal information, money, or investment opportunities. If you get such a call or message, hang up and report the call immediately. You can also send any suspicious emails to the Social Security Administration's Office of the Inspector General (OIG), and file a complaint with the FTC.

You can also visit your local agency office to verify if the inquiry was real. For your online safety, remember to activate two-factor authentication on your Social Security account — and any financial accounts — and to keep your login details to yourself. Similarly, use unique passwords for different sites to protect against data breaches. Also, regularly review your monthly benefit statements to catch any unauthorized activity. You should also consider discussing any digital investment opportunities with a trusted family member or anyone who might be more familiar with technology — since scammers often target people less familiar with digital safety. Finally, if you hear about an investment promising to increase your benefits, always check with a financial advisor first.