Keeping an eye on financial abuse

Notified by the investment company, I immediately contacted the client to find out what was going on. I then contacted the local district attorney who eventually helped put the person away for a long prison sentence. Other red flags are drastic shifts in investment style, inability to contact the senior customers, signs of intimidation or reluctance to speak in the presence of a caregiver, and isolation from family or friends.

• There are many things you can do as a producer to avoid trouble:
• Encourage your firm to designate a specific individual responsible for investigating these issues and who knows what procedures to follow when red flags arise.
• Find out what your obligations and liabilities are if you identify financial abuse. CAUTION: Do not assume that you should immediately notify outside persons about the situation, as there are privacy issues to consider. Moreover, since – most likely – you are not a psychiatrist; you’re not qualified to make these types of judgment calls. Instead notify someone immediately, preferably a supervisor.
• Ask at account opening whether a customer has executed a durable power of attorney, revocable or irrevocable trust.
• Ask at either account opening, or at a later time, whether your customer would like to designate a secondary or emergency contact.
• Ask the client to bring his or her children to any appointments you might have.
• Refuse to perform a particular transaction for a customer if you feel it is not appropriate.
• Keep client information current so you can better assess their ongoing needs.

To help you understand more about these and other issues and for valuable training, FINRA maintains a database at www.finra.org. Another great resource is Tom Orr, with Senior Insurance Training. Orr’s website is www.ltcce.com .