It’s a heartbreaking and, unfortunately, common story: an elderly man receives a phone call from someone claiming to be his granddaughter asking for him to wire money to get her out of a sticky situation. A late night infomercial offers a deep discount on dishware without mentioning the hundreds of dollars in nonrefundable shipping fees.
These are the scams targeting the elderly that True Link Financial, a Y Combinator startup that launches today, is hoping to help families avoid by equipping prepaid Visa cards with personalized fraud protection.
CEO Kai Stinchcombe said he had been looking for a solution to this problem for a few years before founding True Link, after his 92-year-old grandmother began writing up to 75 checks a month for organizations posing as charities. Banks can’t do anything to reverse this kind of damage once the check is written and sent, he said. Families don’t have many options besides taking away their elderly family members’ checkbooks and depriving them of their sense of autonomy.
True Link develops risk profiles for elderly people, who are typically signed up by their adult family members. If an individual over-gives to charities, they can limit donations to a list of approved organizations while blocking payments to potential scams. Stipulations can be set on only allowing transactions made in person, and payments can be capped at a certain amount per purchase.
All this goes through a pre-paid True Link Visa card, filled through the person’s checking account, which is free for the first year and costs $20 annually after that. True Link acts as the preauthorizer, giving it the power to see incoming charges and approve or deny them accordingly.
Scamming is a grey market, Stinchcombe said, and it’s hard to put an exact number on the scope of scams out there. But he estimates that there are 10 million people in the U.S. above a certain age who are living alone and susceptible to fraud.
True Link is currently working on building its list of fraudulent and potentially fraudulent organizations, said Claire McDonnell, who leads product development and interviewed roughly 400 elderly people and families in market research this year. Outside of the team’s efforts, reports of scams having been coming in from families.
Long term, True Link is planning to scale by partnering with large retirement homes and organizations for caregiving, retirement home placement, and health care.
Getting a parent or grandparent set up with True Link does, of course, mean introducing the particularly difficult subject of restricting their financial independence.
“It can be extremely emotionally difficult,” McDonnell said. “The way we think about it is this: if you believe there are people out there who want to take your money, you want to be protected. If you have a problem, you have to solve it. [True Link] is for people who are already having that conversation and are used to managing [their parents'] finances already.”
Taking away a person’s financial independence entirely comes at great emotional cost, McDonnell pointed out, and it accelerates decline, especially in people with dementia. True Link preserves some of that autonomy while preventing elderly people from needlessly blowing through their retirement fund.
In Stinchcombe’s words, True Link’s mission is quite simple:
“Fuck these scammers.”