Texas lawmakers have passed an elder financial abuse prevention bill that they expect to be signed by Gov. Greg Abbott.
The bill requires advisors and broker-dealers to report suspicions of elder abuse to the state commissioner and the state’s department of family and protective services. They also will have 10 days to withhold disbursements for which they have concerns.
“We are one step closer to better protecting seniors from predators while ensuring financial services professionals do not inadvertently violate privacy laws,” said FSI President and CEO Dale Brown, in a statement.
May is Elder Abuse Prevention Month in the Lone Star State, and FSI had some of its members lobby for the proposed legislation.
“One of our main advocacy priorities is the prevention of financial exploitation of vulnerable investors. We applaud the Texas State Legislature for listening to and working with our members by taking this critical step forward to prevent elder financial abuse,” Brown explained.
FSI says it discussed the issue during its Texas State Capitol Day in February, when some of the group’s members described personal stories with legislators and their staff regarding elder abuse.
“We have long said that the power of FSI comes from our members,” Brown added. “When financial advisors become citizen lobbyists, they can truly make a difference.”
This news comes about two months after the Financial Industry Regulatory Authority said it will begin enforcing to new rules aimed at curbing financial abuse.
Starting in February 2018, FINRA firms will have to “make reasonable efforts” to get the name and associated information for a “trusted contact person for a customer’s account” and will be allowed to put temporary holds on the release of funds or securities “when there is reasonable belief of financial exploitation,” according to the regulator.
“These rules will provide firms with tools to respond more quickly and effectively to protect seniors from financial exploitation,” said FINRA President and CEO Robert Cook, in a statement. “This project included input and support from both investor groups and industry representatives, and it demonstrates a shared commitment to an important, common goal – protecting senior investors.”
Senior abuse is getting more attention from politicians and others in Texas and elsewhere.
In May 2014, a local nonprofit was formed via a partnership between the Dallas County probate courts and district attorney’s ofce. Since the center opened, the Dallas County district attorney’s ofce has investigated nearly 1,300 complaints of elder nancial exploitation, leading to almost 840 indictments, according to a recent report in the Dallas News.
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