Senator Makes New Push for Senior Safe Act
Bill is designed to prevent financial exploitation of elder investors by training and granting immunity to financial professionals
January 26, 2018
Sen. Susan Collins, chair of the Senate Special Committee on Aging, has reintroduced her Senior Safe Act, which is designed to protect vulnerable adults from financial exploitation.
In introducing the Senior$afe Act of 2017 (S. 223), Collins, R-Maine, noted that the bill aims to protect banks, credit unions, investment advisors, broker-dealers, insurance companies and certain supervisory, compliance and legal employees from civil or administrative liability — as long as they receive training in how to spot and report predatory activity and disclose any possible exploitation of senior citizens to state or federal regulatory and law enforcement entities.
A similar bill passed the House last July.
Collins’ bill is based on Maine’s Senior$afe program, a collaborative effort by Maine’s regulators, financial institutions and legal organizations to educate bank and credit union employees on how to identify and help stop the financial exploitation of older Maine residents.
The program, pioneered by Maine Securities Administrator Judith Shaw, also serves as the template for a model rule developed for adoption at the state level by the North American Securities Administrators Association.
The Financial Services Institute said Tuesday that it urges the Senate “to support the Senior$afe Act of 2017, ensuring that financial advisors and broker-dealers have the ability to report suspicions of financial exploitation whenever they suspect fraudulent behavior without fear of liability,” according to a statement.
State measures to prevent elder financial abuse gaining steam
A growing number of states are looking to pass rules preventing exploitation of seniors
Jan 18, 2018
By Greg Iacurci
States are increasingly wading into the fight to combat elder financial abuse, the top state securities regulator said Thursday.
The North American Securities Administrators Association released a model rule two years ago that mandates that advisers report suspected abuse to certain state authorities, allows them to stop disbursements from seniors’ accounts and gives them protection from liability.
To date, 13 states have passed a version of the model act, and roughly 10 more states are expected to follow suit this year, said Joseph Borg, NASAA’s president and the securities commissioner in Alabama.
“We know it’s going to be introduced in a number of state legislatures,” Mr. Borg said at an event in New York focused on financial wellness and aging. AARP, Bank of America Merrill Lynch, the New York Academy of Medicine and the Global Coalition on Aging sponsored the event.
Some states may be waiting to see what happens at the federal level before taking action, Mr. Borg said. Legislation similar to NASAA’s model rule is currently working its way through Congress. If there’s no further congressional action this year on that bill, the Senior Safe Act, some states may feel compelled to take up NASAA’s rule, Mr. Borg said.
About half of the states could end the year with laws on the books empowering and enlisting financial advisors in the fight against elder financial abuse, InvestmentNews reports.
Ten states already have laws based on a model from the North American Securities Administrators Association, and about 10 more should join that list in 2018. That’s according to NASAA president Joseph Borg, who spoke in New York Thursday.
NASAA’s model rule requires advisors to report suspected abuse to authorities. It also gives them the legal ability to stop disbursements from seniors’ accounts and shields them from liability, InvestmentNews notes.
States may not have to bother with their own laws if Congress passes its own NASAA model-based law. Such a bill is in the pipeline in Congress.
Elder financial abuse is a huge problem, affecting upwards of $36 billion a year, as Advisor Center has noted. The costs, financial and otherwise, fall on families, the economy and society as a whole, Philadelphia Fed chief Patrick Harker said in a recent speech.