Table of Contents
Who is considered a senior investor?
(collectively, the “staff”) conducted 44 examinations of broker-dealers in 2013 that focused on how firms conduct business with senior investors as they prepare for and enter into retirement. These examinations focused on investors aged 65 years old or older; this report refers to these investors as “senior investors.”.
How the SEC works to protect senior investors?
The SEC uses exam findings to inform rule-making initiatives, identify and monitor risks, improve industry practices and pursue misconduct—all of which are highly relevant to the goal of protecting senior investors.
What is Senior Safe Act?
Immunity. If all the conditions are met, the Senior Safe Act protects individuals from liability in any civil or administrative proceeding for disclosing the suspected exploitation of a senior citizen to a covered agency.
What are the two conditions of individual immunity?
Two types of immunity exist — active and passive: Active immunity occurs when our own immune system is responsible for protecting us from a pathogen. Passive immunity occurs when we are protected from a pathogen by immunity gained from someone else.
What finra 2111?
FINRA Rule 2111 requires that a firm or associated person have a reasonable basis to believe a recommended transaction or investment strategy involving a security or securities is suitable for the customer. Brokers must have a firm understanding of both the product and the customer, according to Rule 2111.
What is one reason why seniors might be exploited?
Physical decline and dependency are also risk factors for elder financial exploitation. So, too, is the wealth of older generations, which makes them targets for financial exploitation.
Who is a specified adult?
Rule 2165 defines “specified adults” as all adults who are 65 years of age or older or who have physical or mental disabilities that impair their ability to advocate for their own financial interests. Brokers who work with specified adults must maintain records of trusted contacts for these clients.
What is considered covered financial institutions under the SAFE Act?
Covered Institutions The FRB rules cover state member banks, their subsidiaries that are not functionally regulated within the meaning of the Bank Holding Company Act, and the branches, agencies of foreign banks (not covered as Federal foreign banks or branches) and commercial lending companies owned by foreign banks.
What percentage of financial exploitation of older adults is committed by family members?
About 5.2% of older adults report financial exploitation from a family member. Financial elder abuse has resulted in losses of $2.9 billion per year.
Under what condition will an institution receive immunity after one of their eligible employees makes a report about suspected financial exploitation of a senior client?
A covered financial institution also receives institutional immunity when an eligible employee makes a disclosure to a covered agency and all employees have received training to the extent necessary to qualify for immunity under the Senior Safe Act.
What is the difference between Rule 2111 and Rule 2330?
[1] Weirdly, Rule 2330 does NOT explicitly cover recommendations involving a “strategy,” as Rule 2111 does. If you read Rule 2330, it only “applies to recommended purchases and exchanges of deferred variable annuities and recommended initial subaccount allocations,” i.e., actual transactions, not strategies.
When did FINRA Rule 2111 become effective?
Practice Tip: Rule 2111 raises a number of concerns that FINRA member firms must address by October 7, 2011, the effective date of the new rules.
How does FINRA define a customer?
[A] ‘customer’ under FINRA Rule 12200 is one who, while not a broker or dealer, either (1) purchases a good or service from a FINRA member, or (2) has an account with a FINRA member. 1. The meaning of “customer” is essential to determining whether a potential dispute must be arbitrated.
What is financial exploitation of the elderly?
(a) A person commits financial exploitation of an elderly person or a person with a disability when he or she stands in a position of trust or confidence with the elderly person or a person with a disability and he or she knowingly and by deception or intimidation obtains control over the property of an elderly person.
Why are elderly vulnerable to financial abuse?
People financially abuse elders because they choose money over the trust and well-being of the older person. This is particularly true when the elder is a family member. Family members who commit elder financial abuse may: Fear the elder will use all their savings and leave nothing for the family.
How do you investigate financial exploitation of the elderly?
If you want to report elder financial abuse, contact your local county APS Office (PDF). Abuse reports may also be made to you local law enforcement agency.
Which of the following people are considered specified adults?
(1) For purposes of this Rule, the term “Specified Adult” shall mean: (A) a natural person age 65 and older; or (B) a natural person age 18 and older who the member reasonably believes has a mental or physical impairment that renders the individual unable to protect his or her own interests.
What FINRA 4512?
FINRA Rule 4512 (Customer Account Information) requires members to make reasonable efforts to obtain the name of and contact information for a trusted contact person upon the opening of a non-institutional customer’s account or when updating account information for a non-institutional account.
What is the FINRA Rule 2330?
Rule 2330 requires a registered principal to review and determine whether to approve a customer’s application for a deferred variable annuity before sending the application to the issuing insurance company.
When should MLO be federally registered?
An MLO must update his or her registration within 30 days for specified significant changes, including name changes, employment termination, and reportable changes to legal or regulatory actions.
What is the proper title of the SAFE Act?
Title V of P.L. 110-289, the Secure and Fair Enforcement for Mortgage Licensing Act of 2008 (“SAFE Act”), was passed on July 30, 2008.
Can an MLO do their own loan?
Can the MLO use their federally registered MLO status to originate loans for their own non-federally regulated mortgage company? No! The SAFE Act exempts a federally registered MLO from state MLO licensing requirements only if the MLO is an employee of a federally regulated bank.
