Veterans and military retirees filed nearly 300,000 fraud reports with the Federal Trade Commission from 2019 through Sept. 30, 2023. Their losses totaled $842 million.   (DOD graphic by Regina Ali)

WASHINGTON — Self-employed contractor Brian Orr, an Army veteran from Colorado, was installing wood floors at a client’s home when he got a call Nov. 22 from someone claiming to be a local law enforcement officer.

The caller identified himself as Sgt. Brian Collins of the Douglas County Sheriff’s Office and demanded Orr pay back a $20,900 Small Business Association loan or face jail time.

An arrest warrant had been issued, according to the caller, who forwarded an official-looking stamped document from the “U.S. Court in the District of Colorado” with Orr named as defendant.

Orr said he rushed to pay back a government loan that was not overdue and then kept transferring cash — hundreds of dollars at a time — via a bitcoin ATM as instructed by the caller.

“I panicked. I did not want to go to jail,” said Orr, a 46-year-old single parent with a teenage son.

Orr made four transactions totaling $17,500 in 24 hours, from Nov. 22-23.

Even after Orr made the payments, the calls continued. He said he was told that unless he covered the difference, he would be “remanded” by the court to jail.

“I didn’t have the money. I decided to turn myself in,” Orr said. He drove to the county sheriff’s office in Castle Rock, where the authorities informed him that he was the victim of a scam.

Veterans and military retirees are a common target for fraud and identity theft because of their benefits, according to the Federal Trade Commission.

“Veterans should know that impostors are reaching out by phone, email, text or social media message. The scammers pretend to be someone legitimate like your bank, a government agency, or even a friend or loved one,” said Carol Kando-Pineda, a FTC attorney in the division of consumer and business education.

The Department of Veterans Affairs is also warning veterans and their families to take extra precautions during the holidays as scammers might try to take advantage of people through fraudulent charities that steal money from donors who are led to believe they are giving to legitimate organizations.

More so, with the flow of millions of dollars to veterans through the recently approved PACT Act, the VA said scammers are looking for ways to steal the payments, which include fraudulent offers to make the claims and complete the paperwork on behalf of the veterans.

“The police did not seem surprised at all,” Orr said about the scam. “But they and the bank said that the chances of me getting the money back are zero.”

Brian Orr and his son, Gage Orr, are shown at an outdoor event in summer 2023 at Red Rocks Amphitheatre in Colorado. (Brian Orr)

He had saved the receipt codes for the transactions, but the money moved through anonymous accounts that would be difficult to track.

“My savings were drained,” Orr said. “I had enough money left to pay the rent.”

The experience shook his sense of safety and security, he said.

“I thought the system would protect me somehow,” Orr said. “I just don’t pick up the phone anymore when I don’t recognize the number. I was violated in my home, in front of my family, when I answered those calls.”

Veterans are attractive targets because they have “earned access to valuable benefits” in the form of pensions and disability payments, Kando-Pineda said.

Veterans and military retirees filed nearly 300,000 fraud reports with the FTC from 2019 through Sept. 30, 2023. Their losses totaled $842 million.

Active-duty service members, by contrast, filed roughly 30,000 reports of fraud during the same time for $142 million in losses, the FTC reported.

In 2021, military consumers reported $267 million in losses from fraud, according to the FTC. In 2022, military consumers reported $414 million in losses — a 55% increase.

VA Secretary Denis McDonough held an inaugural meeting Tuesday of a special task force to address scams perpetuated against veterans.

“Veterans face particularly high risks for fraud with the median loss for veterans from fraud 44% higher than other civilians,” the VA reported.

The agency is setting up a permanent office to coordinate prevention and responses to predatory and fraudulent activities that target veterans’ benefits.

Topping the list of fraud complaints reported by the military community are “impostor scams,” similar to the demands for payment that Orr had from a caller posing as a law enforcement officer.

In Orr’s case, information about his federal Payroll Protection Program loan, also known as PPP, was available online, identifying him and his business — Orr’s Flooring of Castle Rock.

“I thought my loan was forgiven through the bank,” he said. “I was working a lot and did not bother to check up on whether the calls were legit until it was too late.”

“The scammer sounded authoritative and used personal information, including the exact amount of the loan that Brian received in the past, to convince him that this was no scam,” said James Watson-Howatt, a friend who organized a Go Fund Me page to help Orr cover his losses.

The Douglas County Sheriff’s Office posted a warning on social media after reports by Orr and at least one other resident targeted by thieves posing as police officials.

“Criminals are making the rounds again, impersonating members of our office. Remember, we will never call you looking for you to resolve a situation by paying us money,” the sheriff’s office posted this month on X, formerly Twitter.

Janine Williamson of Washington is advocating for stronger banking safeguards to stem financial fraud after her uncle, a Navy veteran, was defrauded of more than $3.5 million.

Her lawsuit against Wells Fargo and the Navy Federal Credit Union are before the U.S. Court of Appeals for the Fourth Circuit in Richmond, Va., involving a series of bank transfers by 76-year-old Larry Cook to foreign bank accounts in a wire fraud scheme.

Cook, who had suffered a stroke that left him cognitively impaired, made dozens of wire transfers in 2020 and 2021 prior to his death, the lawsuit states. His niece discovered the transfers when she was settling his estate.

She wants to see tighter regulations to protect consumers.

“Thieves target money, and veterans have money,” Williamson said, referring to veterans’ pensions and benefits. “The military lives and breathes protection of its citizens every day. Shouldn’t the bank or credit union do the same for its clients?”