The 25 states that have enacted model legislation designed to protect seniors from financial abuse have received 426 reports from broker-dealers and investment advisers, according to the North American Securities Administrators Association.
The reports shed light on victims of securities fraud and elder exploitation, and other seniors who need some form of assistance, NASAA said in a release.
The group’s Model Act to Protect Vulnerable Adults from Financial Exploitation was adopted by the organization of state securities regulators in 2016.
“The model act is on a course to become operative in a majority of states this year, and, as more states enact legislation based on this model, we expect to see additional reporting leading to more enforcement actions and greater protections for seniors and other vulnerable adults,” said Christopher W. Gerold, NASAA president and chief of the New Jersey Bureau of Securities.
Based on the 426 received reports, state securities regulators opened 81 investigations, and initiated 32 formal enforcement actions. Reporting firms also delayed the disbursements of funds 57 times.
The model act gives industry participants and state regulators tools to detect and contain financial exploitation of vulnerable adults, NASAA said.The law gives broker-dealers and advisory firms qualified immunity if they delay disbursements because they suspect financial exploitation. It also requires them to report to the state securities regulator and state adult protective services agency if someone at the firm believes they've spotted financial exploitation of an eligible adult.
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