A personal financial risk assessment intervention decreases investment fraud susceptibility in older adults

Abstract

Older adults are more often the targets and victims of financial fraud, with Americans aged 65and older being 34% more likely to lose money due to fraud than those in their forties. This greater susceptibility to fraudulent offers may be due to a shift from more deliberative thinking to automatic thinking that occurs during normal ageing. This experiment tests an intervention that engages deliberative thinking about risk preferences (aPersonal Risk Assessment) as a means of decreasing susceptibility to an email with tell-tale signs of a fraudulent investment. The intervention was delivered to younger (aged < 60) and older (aged 60+) groups. Compared to age-matched controls, the intervention reduced susceptibility in the older group but not the younger one. This difference between the groups may be due to different underlying risk preferences, with the younger group having more risk tolerance. Prompting older adults to deliberately reflect on their risk-aversive preferences thus appears to counteract the effects of age on susceptibility to fraud. This experiment provides a new means of reducing susceptibility to fraud among older individuals. Future research should examine ways of decreasing susceptibility in younger populations and investigate underlying mechanisms of fraud susceptibility in both age groups.