Retirement in the age of cyberscams
How to protect your employees, your plan, and yourself.
Time to read: 6 minutes
Key takeaways
- Financial fraud complaints continue to rise at an alarming rate, up fivefold in recent years, with older Americans losing the most.
- Today's fraudsters weaponize fear and loneliness, using AI-powered tricks and high-pressure tactics to manipulate unsuspecting retirees into draining their own retirement savings.
- Help’s out there: TIAA and other financial services providers monitor for suspicious transactions but educating employees may work best to protect retirement accounts against fraud.
The fight for retirement savings security
Last summer, Richard Immesberger, president and chief executive of TIAA’s trust company, got the type of phone call he’s come to dread.
A junior associate informed him that an elderly client wanted to transfer more than $2 million to a man the client had never met. The woman had fallen prey to a romance scam, and everyone realized it but her. “She was about to drain every last dollar she had,” says Immesberger.
Next-generation fraudsters have learned that crime pays more easily when it’s aided and abetted by the victims themselves. Immesberger had no legal authority to permanently prevent the client from giving away her savings to someone trying to rob her. All he could do was delay and drag his feet and try to convince law enforcement to step in before it was too late. In cases involving those 65 and older, the Financial Industry Regulatory Authority, or FINRA, permits financial companies to put holds on suspicious transactions for up to 30 days.1
“I was prepared to stand in front of a judge and justify what I was doing, but I knew I would lose at some point,” Immesberger says. “In the end, it's their money.”
Thankfully, this story had a happy ending. TIAA convinced law enforcement to knock on the client’s door and try to set her straight. It worked. Problem is, too many such stories do not have happy endings. According to
I was prepared to stand in front of a judge and justify what I was doing, but I knew I would lose at some point. In the end, it's their money.
Federal Trade Commission data show the number of fraud complaints doubled between 2019 and 2023. Total losses rose fivefold—from $1.9 billion to $10 billion.3 Older Americans are especially vulnerable: Median losses for those age 70 and older were $10,000, compared to a range of $450 to $3,000 for consumers younger than age 50.4 Federal Bureau of Investigation data paint an even bleaker picture: According to the FBI, the average losses experienced by older victims (age 60 and above) were nearly $34,000 in 2023—close to four times the amount reported to the FBI just three years earlier.5
Even those numbers may understate the problem. Due to shame and embarrassment, financial scams are “vastly underreported,” according to DeLiema. “Older adults may have more to lose socially from acknowledging they’ve been a fraud victim,” she says. “Maybe they’re worried their children will try to take more control over their financial decisions if they found out.”
What can retirement plan sponsors and recordkeepers do to fight back? A lot—and some of it boils down to protecting participants from themselves.
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Two most-common financial scams
Imposter scams
Someone claiming to be with the FBI or another agency convinces victims their money is not safe. The scammer conveys a false sense of urgency. He tells victims they must move their money right away. He uses low-cost tools such as number spoofing and Voice over Internet Protocol (VoIP) to make it appear his calls are coming from the impersonated agency.
The New York Times recently told the story of a 76-year-old who lost his entire life savings to such a scam. The retired lawyer thought he was speaking with federal investigators, who warned him criminals had infiltrated the bank where he kept his retirement accounts. In fact, the real criminals were the “investigators,” who eventually convinced the man to wire his savings to “safe” accounts that were anything but.6
The number of fraud complaints doubled between 2019 and 2023. Total losses rose fivefold—from $1.9 billion to $10 billion.
Source: Federal Trade Commission
Romance scams
Lured by promises of love and companionship, victims are groomed by remote predators for months. Eventually, according to the TIAA Institute, the fake love interests present a series of escalating crises—an unexpected hospitalization, loss of employment, travel expenses, etc.—that are keeping the lovebirds apart. The scammers ask the victim for financial help to resolve each crisis.
One reason older adults are especially vulnerable—apart from the obvious fact they have more savings and thus more to lose—is loneliness. A University of Michigan survey found that 34% of adults aged 50 to 80 feel socially isolated.7 The problem is magnified when decision-making is compromised by cognitive decline. “Scam messages are intentionally designed to exploit psychological vulnerabilities and unmet needs,” according to TIAA Institute, “and lonely individuals may be more willing to engage with scammers who provide emotional validation and companionship.”8
Cyberscam prevention and intervention
One guardrail TIAA builds into its retirement plans is a ban on money transfers to outside accounts not controlled by either the client or a designated beneficiary. While this safeguard can slow scams down, a victim can still request a transfer from their TIAA account to their bank account and then from their bank to the scammer. This, says Immesberger, is why it’s so important for fraud-prevention teams at financial institutions to cooperate with one another and work together—to communicate and intervene when they believe mutual clients may be at risk of financial exploitation. Indeed, an investment company like TIAA may be in a better position to spot scams, thanks to the close relationships that often exist between wealth advisors and clients.
In addition to employing technical solutions to identify scams and frauds, TIAA trains its client-facing associates to recognize and report suspicious transactions and interactions. A dedicated team of fraud fighters then investigates. Additionally, our public
Problem is, not all scams raise obvious red flags. When a 95-year-old suddenly wants to give $500,000 to a stranger, that may set off alarm bells. But if the sum being transferred is $5,000, there’s a better chance of it falling through the cracks. In these instances, the best defense is education. Plan sponsors and plan managers can educate participants about scams and how the scammers operate. In her research, DeLiema found that people who had heard about a particular scam prior to being targeted were half as likely to become victims.9
Effective scam-awareness messaging should:
1. Help participants avoid cyberfraud
- Familiarize plan participants with imposter scams, romance scams and other frauds.
- Explain why people never should allow strangers to remotely access their computers.
- Provide tips on how to practice good digital hygiene, such as recognizing phishing attempts and not clicking on suspicious links that may execute malicious software.
2. Provide clear, easy action steps
- Advise people to hang up on unknown callers.
- Emphasize that participants should talk to trusted family members before making large investments or transactions.
- Encourage participants to provide “trusted contact” details to their retirement plan recordkeeper.
- Convey the importance of reporting when someone is victimized as soon as it happens. (Banks and investment companies may be able to reverse fraudulent transactions if they are informed quickly.)
3. Stay current with cyberscams
- Update cyberfraud guidance regularly to keep up with the latest scams.
Trusted contacts: a last line of defense
Reminding retirement savers to share trusted contact details is critical. The information authorizes investment companies to contact the trusted individual if there is suspicious account activity or a concern about client behavior. “It’s not a miracle cure,” says Rick Swenson, TIAA managing director for fraud strategy and governance, noting that a trusted contact cannot halt withdrawals. “But it does help to have a trusted person reach out to the customer to ensure all is well.”
Sometimes, all it takes is one conversation. “Sometimes it breaks the veil of secrecy,” says DeLiema. “It can pierce through the control the scammer has placed over the person, especially if the trusted contact has a really positive relationship with the potential victim.”
Preventing fraud with AI
Scammers, unfortunately, are innovators. They now use deepfake technology to digitally clone voices and likenesses of victims’ relatives and coworkers, thereby deceiving victims into transferring funds. And whereas spelling and grammatical errors used to be dead giveaways that emails were penned by scammers, AI has fixed this Achilles heel.
“Now that scammers use generative AI, we’ve had to throw out a lot of our old consumer advice,” says Brendan Purcell, TIAA senior director for enterprise fraud detection.
The good news is that fraud fighters can use AI to beat AI. TIAA, for instance, employs machine learning models that detect unusual activity in large data sets. These sophisticated models can analyze participant interactions or financial transactions to determine if certain activity should be investigated or intercepted. Says Dale Jones, TIAA managing director for enterprise fraud management, “We are leveraging innovations and advances in technology to beat scammers at their own game.”
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1 Rule 2165. Financial Exploitation of Specified Adults, FINRA.org
2 Marti DeLiema, “Safeguarding retirement in the age of scams,” TIAA Institute, January 2025.
3 FTC Consumer Sentinel Network Data Books, 2020 and 2024.
4 Marti DeLiema, “Safeguarding retirement in the age of scams,” TIAA Institute, January 2025.
5 FBI Elder Fraud Reports, 2020 and 2023.
6 Tara Siegel Bernard, "Scammers Are Targeting Older Americans and Their Retirement Savings," New York Times, July 29, 2024.
7 “Trends in Loneliness Among Older Adults from 2018–2023,” University of Michigan National Poll on Healthy Aging.
8 Marti DeLiema, “Safeguarding retirement in the age of scams,” TIAA Institute, January 2025.
9 Ibid.
TIAA Institute is a division of TIAA.