Theft, fraud, misuse of a person’s assets or credit, or use of undue influence to gain control of a person’s finances or resources are common examples of elder financial abuse. As many as one in 20 older adults reported some form of financial mistreatment occurring in the recent past, according to the National Adult Protective Services Association (NAPSA). Recently, the Financial Industry Regulatory Authority (FINRA) has announced that the U.S. Securities and Exchange Commission (SEC) has approved a rule to protect senior citizens from financial exploitation.
With the implementation of FINRA Rule 2165 (Financial Exploitation of Specified Adults), member financial institutions are allowed to place temporary holds on disbursement of funds and securities from the accounts of specified individuals where there is reason to believe that this customer is a victim of financial exploitation. Additionally, amendments were made to FINRA Rule 4512 (Customer Account Information) that requires its members to make reasonable efforts to obtain a name and contact information of a trusted person of contact for a customer’s account. New rule 2165 and the amendments to Rule 4512 come into effect February 2018.
FINRA’s Security Hotline for Seniors has highlighted the issues relating to the financial exploitation of older investors, including the need for its members to be able to more quickly and effectively identify and address financial exploitation of seniors and other specified adults. New rule 2165 and amendments to rule 4512 provide member institutions with a way to respond to instances in which they have reason to believe that financial exploitation has occurred, is occurring, has been attempted or will be attempted. Members of FINRA may be able to increase protection of customers from financial exploitation by contacting the customer’s designated trusted point of contact and, when appropriate, place a hold on the disbursement of funds and securities from the customer’s account.
As mentioned in a previous article, seniors may be able to take steps to prevent themselves from falling victim to financial exploitation. Older adults should plan their financial future with trusted family members, friends and professionals. Seniors should not feel pressured or intimidated into quick financial decisions or signing documents that they don’t understand. No one should provide personal information such as their Social Security or credit card number over the phone unless they were the ones to place the call and know who they are speaking with. Credit card receipts, bank statements, solicitations or any other documents that contain personal or financial information should be shredded or torn up before they are thrown out. An experienced estate planning attorney can be of assistance to create a durable power of attorney for asset management, a living will, as well as trust and health care directives.
A properly executed estate plan may be helpful in the protection and management of assets for seniors. Tully Law, PC is experienced in all aspects of elder law and life care planning, including the creation and execution of estate plans. Our lawyers will work with you to create an estate plan that meets your needs and protects your resources for the future. For more information or to schedule a consultation, contact our New York estate planning and elder law firm at 631-424-2800.