Aftermath of Fraud: Life & Health

Aftermath of Fraud: Life & Health - Staying Financially Healthy - Reverse Your Thinking
Aftermath of Fraud: Life & Health – Staying Financially Healthy

Every year, billions of dollars are lost due to financial fraud. As a result, individual victims may have an enormous financial burden. In addition to losing substantial sources of income and wealth, victims frequently can spend months, if not years, navigating a minefield of reporting procedures and negotiating with financial institutions only to deter the fraud from continuing. These are the cost of dealing with the aftermath of fraud.

Following all of that, financial recovery may be at best limited. Victims must realize that, while recuperating lost assets may be impossible, they still can reclaim control of their lives and financial futures, putting an end to the trauma of being a victim. Advocates can support victims in managing their economic recovery expectations.

Individual losses might include:
  • time and money spent verifying and correcting financial and credit records; 
  • lifetime or retirement savings, benefits, or personal property; 
  • house or home equity; 
  • retirement income; 
  • personal autonomy; and 
  • employment

Financial fraud can have far-reaching repercussions that go beyond financial loss.

Regardless of the type of fraud  – Identity Theft, Investment Fraud, Mortgage and Lending Fraud, Mass Marketing and Online Fraud – they seem to have the same detrimental effect on fraud victims. 

Financial fraud could happen to anybody. There is no one description of a victim of financial fraud, and no amount of intellect can safeguard a person from being a victim. According to research, victims come from various educational levels and socioeconomic backgrounds. 

Some forms of financial fraud are more common among specific categories of individuals. Victims of investment fraud, for example, are often male, financially knowledgeable, college-educated, and nearing or in retirement. Lottery fraud victims are more likely to be single, older, and have lower levels of education and wealth.

It is critical to recognize that victims have been emotionally and financially exploited. As a result, they frequently feel forsaken and resent themselves, their skills, and their capabilities for being misled. 

Impact on Mental Health

Financial predators are skillful con artists and fraudsters. As a result, they have keen insight into human behavior and how to exploit others. In addition, financial fraud offenders may be family members of victims in some circumstances, which can exacerbate victims’ emotional trauma. Recognizing that everyone is vulnerable to fraud helps alleviate the shame and guilt that they are experiencing. 

Financial fraud may have a significant emotional impact on victims. To point out, understanding such emotions is critical for emotional healing from financial exploitation. Victims’ responses are similar to other crime victims, including victims of violent crime.

According to the FINRA Foundation study, roughly two-thirds of fraud victims suffer at least one significant emotional repercussion.

Fraud victims often suffer from:
  • denial; 
  • fear;
  • guilt;
  • shame;
  • Isolation;
  • anger;
  • anxiety;
  • insomnia;
  • loss of self-confidence;
  • loss of trust in others;
  • depression.

It’s important to realize; you are not alone. Every year, millions of individuals are duped. Some populations are more frequent targets of fraudsters because of their age, health, or life situation. And you are a target only because you have money and assets to steal—not because of a failing on your part. 

Among those targeted are:
  • senior adults, especially those who depend on family and friends for their care or those who have physical or mental impairments;
  • individuals who are physically impaired; 
  • individuals who have cognitive issues or age-related mental incapacity (e.g., dementia, including Alzheimer’s Disease);
  • those who are grieving the loss of a loved one;
  • victims of domestic violence;
  • near-retirees; and
  • previous victims of financial fraud.

Other variables that predispose persons to financial fraud (other than identity theft), according to a 2011 AARP Foundation National Fraud Victim Study, include:

  • a high level of interest in persuasion statements that are commonly made by fraudsters and salespeople; 
  • increased exposure to sales situations, such as attending free-meal financial seminars and opening and reading all mail. 

In short, the repercussions of financial fraud extend far beyond financial loss to encompass emotional and mental health. Additionally, financial fraud, like burglary, is a crime of opportunity. No one deserves to be a victim of fraud. By all means, the perpetrator is to blame. Advocates can aid victims by linking them to emotional and mental health resources.


If you have been a victim of fraud, you may be more likely to be targeted for future scams. Because your information or identity may have been compromised, be suspicious of loan modification schemes that ask you to pay in advance, as well as offers that guarantee results or claim to be “no money down.”

Protect Yourself:
  • Do not make a false statement on your loan application, such as overstating your income.
  • Never sign a blank document or a document containing blank lines.
  • Read all documents before signing.
  • If you don’t understand what you are signing, hire an attorney to review the documents for you.
  • Furthermore, if the terms of a loan sound too good to be true, they probably are.
  • Resist high-pressure tactics. Tell the salesperson you need time to consider your decision.
  • Find a housing counselor through the U.S. Department of Housing and Urban Development at (888) 995-HOPE.
  • Get referrals for loan and mortgage professionals when you want to obtain a loan or mortgage.
  • Verify the licenses of mortgage and loan professionals with state, county, or city regulatory agencies.
  • Beware of “no money down” and “no-doc” loans. “No doc” loans do not require borrowers to provide documentation of their income. Take extra care to check out the source of these loans with a housing counselor.

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