Jan 16, 2016 | aging, aging investor, elderly, financial elder abuse, investor, scammers, senior citizen investor, senior investor
“What You Can Do About Financial Elder Abuse”
Summary of course:
Financial abuse of elders has been called the crime of the century. A recent study shows that it costs seniors over $36B per year in the US. Every hand is needed to prevent and stop this crime of opportunity, including the help of financial professionals. We review the nine domains of financial capacity and describe the seven warning signs that your client may be a victim of financial abuse. We suggest ways that a senior-specific policy can offer advisors a clear path to follow when client conduct puts you on notice of a diminished capacity problem. We show you “hero stories” of financial professionals who took action and did stop abuse.
Learning objectives:
- To improve your understanding of the enormity of the problem of financial elder abuse in the US.
- To help you understand the legal options that exist to address elder abuse, both in criminal and civil venues.
- To improve your understanding of how diminished capacity for financial decisions leads to vulnerability to abuse by predators.
- To provide a clear understanding of the seven warning signs of financial abuse.
- To provide you with an action plan that so you can take protective action for your clients who appear to be at risk.
Jan 16, 2016 | aging, aging investor, elder investor, elderly, finra, investor, NASAA, SEC, senior investor
“Regulatory Changes Advisors Must Face With Your Aging Clients”
Summary of course:
Update on what the SEC, FINRA an NASAA have in mind for financial professionals across the country in how they do business with clients over age 65. Review of the research these agencies have done, Model Rules regulators have created and what exemplary things they found firms and organizations doing for aging clients. They all want financial professionals to be more protective of aging investors. They envision mandates for reporting financial abuse of elders will and expand mandates into other areas. This course highlights areas regulators expect advisors to address, such as training in senior issues and increased communication with aging clients. It provides specifics on how to get ready for what the regulators want so that you will not have to scramble to comply with mandates.
Learning Objectives:
- Understand the regulators’ concept of a “senior program” and how you can create one.
- Know the Model Rules about financial abuse the regulators have already publicly posted.
- Know what other firms across the US are doing about aging investors that you should be doing too.
- Know what action steps you can and should take now to be ready for mandates.
Jan 16, 2016 | aging, aging investor, Alzheimer's disease, diminished cognition, elder investor, elderly, financial capacity, investor, senior citizen investor, senior investor, the gray zone
“Best Practices For Managing Clients With Diminished Capacity”
Summary of course:
Our population is living longer than ever. The risk of dementia rises with age. That means that most of us are going to encounter problems of aging in our clients.
We need to recognize the red flags of impairment that will affect financial capacity. These include:
- Cognitive signs, such as memory loss and difficulty understanding the conversation
- Communication, calculations and orientation problems
- Emotional signs that are out of character for your client.
It is essential for every financial professional to understand the complexity of financial capacity and appreciate how many parts it has. There are 9 domains of financial capacity. You cannot determine if a person is impaired or not just by talking on the phone with her or having a brief meeting in which you give information.
A normal social conversation with the client is not a measure of whether or not the client has diminished financial capacity.
The more aware you are as a professional, the better chance you have of protecting your client from loss and protecting yourself as well.
Learning objectives:
- Prepare yourself for the wave of aging clients by understanding the demographics of our aging population and the risks of dementia associated with aging.
- Understand the 9 domains of financial capacity and learn how to spot problems with any one of them.
- Be able to identify red flags of impaired cognition that should prompt you to act.
- Develop a personal plan for what to do when you see warning signs of diminishing financial capacity
Nov 24, 2015 | finances for elders, financial capacity, finra, NASAA, SEC, senior citizen investor, senior investor, seniors finances
FINRA, together with the SEC and NASAA are on a joint mission to keep seniors and impaired adults from being financially abused. FINRA has proposed new rules that will allow a firm to put a temporary hold on financial transactions when abuse is suspected, and will allow the firm to contact a trusted other during this hold period.
Where’s the flaw? No rule yet mandates that every financial firm and every individual advisor obtain information for a trusted contact person for every client. Not only should this be required for all new accounts, it should be mandated that such trusted others be identified for every client over age 65. As the risk of dementia doubles approximately every five years after age 65, the reasons for the advisor to have someone to call when concerns arise is obvious.
As to the subject of the trusted other, the elder usually names an adult son or daughter as the trusted one. Sometimes that is all the information the advisor has. At the same time, the studies on elder financial abuse show us that family members are the most frequent abusers. Do you see the contradiction here? Every advisor should be required to obtain not only one “trusted person” but two or three so that if abuse is going on or seems to be a threat, the advisor can involve more than one person in the effort to stop it.
Another flaw in the proposed rule is that is it assumed that something helpful will occur during the hold period when the institution is excused from liability for not acting. But there is no clear evidence that either advisors or institutions are being trained to spot financial abuse warning signs before the money is all drained from the account. As we see it, the proposed rule focuses on doing something after abuse is clear and the institution has “a reasonable belief” that financial abuse is occurring. We think the industry can do much better than reacting by being required to call someone after the client has been taken advantage of or had the portfolio plundered.
Here’s the truth: getting an unwilling aging person to step down from financial authority over his portfolio takes more than a few days or a couple of weeks. If there is a trust in place and the elder is the trustee, the terms often state that at least one doctor, or two must say that the client is no longer capable of handling financial matters. Getting a doctor or two to see the client, do an assessment and produce something in writing with the needed findings can take months. And we’ve witnessed this exact scenario when it did take three months to oust the impaired, demented senior who wanted to give his predatory adult child a debit card for his cash management account.
At AgingInvestor.com, where we educate both financial institutions and independent advisors about stopping financial abuse, we think the effort to keep elders financially safer needs to go to the front end of abuse, not the back end after it has happened. Proactive steps can be taken. We urge every financial professional to know the warning signs of diminished capacity so you can engage the trusted third party when the signs emerge, rather than waiting until someone, whether family or outside predator seizes the opportunity to exploit diminished capacity.
To learn more about what you or your institution can do that we think is much better than simply being allowed to hold transactions for a bit when you believe abuse is going on, contact us at AgingInvestor.com. We have an entire program outline ready for you with focus on prevention.
If your client is being manipulated, holding transactions when you’re pretty sure it’s gone on can do little to protect your client. The predators and thieves can empty an account faster than it would take you to fill out the forms FINRA will inevitably give you. Think the way you are trained to think about finances generally: plan ahead, anticipate problems before they get here, and take protective action.
Carolyn Rosenblatt, RN, Elder Law Attorney, Founder AgingInvestor.com
Aug 28, 2015 | aging, aging investor, elder investor, finances for elders, financial elder abuse, handling money for aging parents, handling money for seniors, senior investor, seniors finances
So many professionals we talk to are worried about aging clients, those in their 80's, 90's and older. And for good reason. Mikol's mother is now 92 and she lives independently. She is not exactly a sophisticated investor or consumer. She is very sharp mentally, but that does not mean she could not be manipulated. She has already been taken advantage of by one financial advisor. He got caught though. By us. We took a quick video of Alice, and without naming any names, you can see what she has to say about what the investment this advisor put her into. Click on image to see Video.
We have a very special advantage with Alice. She is willing to let us watch over her investments and her day to day financial life. Not only is she open to receiving this support, she generally welcomes it. That is not an advantage every family has. But even if your aging client or loved one is less than willing to allow those in their lives who can protect them from harm to discuss their financial business, they may be willing to make at least one concession. We recommend that you try for this, suggest it to all the aging folks in your world and take one small step in the direction of their protection.
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