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Summary: The "Deceased Relative's Debt" Scam ​

This cruel scam targets seniors who are grieving the loss of a loved one. A ruthless caller, pretending to be from a debt collection agency or law firm, aggressively claims the deceased relative had an unpaid debt. They use threats of legal action, arrest, or seizing assets to panic their victim into believing they are legally responsible for the debt.​

The goal is to force immediate payment through untraceable methods like wire transfers or gift cards . Remember: You are almost never personally liable for a deceased relative's debts in Australia.

Below is a detailed, step-by-step breakdown of how this scam works . Please read and share it to protect yourself and your loved ones.

Scam Breakdown: The "Deceased Relative's Debt" Scam ​

The Hook: An aggressive, threatening phone call from a fake "debt collection agency" or "law firm."
The Goal: To intimidate a grieving senior into paying a non-existent debt they are not responsible for, using fear of legal consequences.

Step 1: The Information Gathering (The Setup)

• How they do it: Scammers meticulously read online obituaries and death notices. These sources provide them with everything they need: the deceased's full name, address, date of death, and the names of surviving family members (especially the spouse or next of kin).
• Why it works: This public information allows the scammer to sound incredibly credible from the very first second of the call.

Step 2: The Initial Contact (The Hook)

• How they do it: They place a call to the senior (often the spouse or eldest child) a few weeks after the death. They use spoofing technology to make their caller ID appear to be from a legitimate-looking company, a law firm, or even a government agency.
• The Story: The caller is immediately aggressive and official-sounding. They identify themselves as "David Clarke from Legal Recovery Services" and state they are collecting on an outstanding debt in the name of the deceased relative (e.g., an old credit card, personal loan, or medical bill). They will quote the deceased's full name and address to confirm they have the "right file."

Step 3: Applying Pressure and Fear (The Threat)

• How they do it: This is the core of the scam. The caller will falsely claim that the senior is now legally responsible for the debt as the next of kin. They will use forceful language and threats to create panic and short-circuit rational thought.
• Common threats include:
  
  • "As the executor/spouse, you are personally liable for this debt under Australian law."
  • "If you do not pay today, we will immediately begin legal proceedings against you."
  • "We will have to freeze your bank accounts and place a lien on your house to settle this debt."
  • "A warrant will be issued for your arrest for non-payment of debts." (This is completely false).

Step 4: Demanding Payment (The Theft)

• How they do it: They will insist the matter is too urgent for mail or standard payment processing. They demand immediate payment using methods that are untraceable, irreversible, and quick.
• Preferred Payment Methods:
  
  • Wire Transfers: They will pressure the victim to go to their bank and wire money via Western Union or MoneyGram to a specific individual.
  • Gift Cards: A major red flag. They may instruct the victim to buy Google Play, Steam, or iTunes gift cards from a nearby store and read the codes over the phone. They often justify this by saying, "This is how we process secure payments for legal settlements."
  • Prepaid Debit Cards: Asking for the numbers from a Vanilla or similar prepaid card.
• The scammer will often stay on the phone throughout the entire process, isolating the victim and preventing them from speaking to a bank teller, family member, or friend who might question the transaction.

Step 5: The Follow-Up (The Squeeze)

• If the payment is successful, the scammer will likely call back days or weeks later. They may claim:
  
  • "There was a processing fee we didn't include."
  • "We found another outstanding debt in the file."
  • "The first payment didn't go through; you need to send it again."
• This attempts to extract even more money from the victim, who has already been primed to comply.

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Crucial Guidance to Offer Seniors: ​

1. Know the Law: This is the most powerful defence. In Australia, you are generally not personally responsible for the debts of a deceased relative. Debts are paid from the deceased's estate (their money and assets) by the executor. If the estate has no money, the debt is typically written off. Creditors cannot legally demand payment from children or family members unless they were a co-signer on the specific loan.

2. Verify, Verify, Verify:

• HANG UP immediately. Do not engage in conversation.
• Do not call back the number they provide or that appears on your caller ID.
• If you are genuinely concerned, find the official contact details for the company they claimed to be from through an independent search (e.g., a past statement or a Google search) and call them to inquire. The real company will have a record if the debt is legitimate.

3. Spot the Red Flags:

• Threats and aggression: Legitimate agencies do not use threats of immediate arrest or lawsuits.
• Demand for immediate payment: Real debt collection follows a strict process and gives you time to respond in writing.
• Unusual payment methods: No legitimate business will ever demand payment via wire transfer, gift cards, or cryptocurrency. This is always a scam.

4. Talk to Someone: Instill a golden rule: never pay money or give personal information based on an unsolicited call. Always tell the caller, "I will need to discuss this with my family solicitor or my child first," and then hang up. Discussing it with a trusted third party will almost always reveal the scam.

5. Report It: Report the attempt to the National Anti-Scam Centre via Scamwatch (www.scamwatch.gov.au). This helps authorities track and combat these scams.