Missouri Elder Fraud Law Sets Example for States

Posted on March 3rd, 2016 at 9:23 AM

From the Desk of Jim Eccleston at Eccleston Law LLC:

Six months after taking effect, Missouri’s new law protecting seniors from financial exploitation is having a noticeable impact. “People are telling us that as they’re getting older, they are able to invest with more confidence,” stated Missouri Secretary of State Jason Kander. “Financial professionals are telling us that they have more confidence in their clients’ ability to invest, too, because they’re now empowered to hit the pause button if they think someone is being exploited.”

The Missouri Senior Savings Protection Act (SSPA), enacted in August of 2015, allows broker-dealer representatives to report suspicious financial activity and hold wire transfers for up to 10 business days if they sense a client is being exploited on the basis of their age or mental status. Because of privacy laws and contract terms, broker-dealers could previously not report their suspicions.

The SSPA applies to adults older than 60 (or those between 18 and 59 with verifiable mental or physical impairment). If a brokerage firm suspects that such a person is the victim of fraud or exploitation, it is authorized, but not required, to first report its suspicion to the state Department of Health and Senior Services or the Missouri Commissioner of Securities. Thereafter, the broker-dealer may report the suspected fraud to a relative, guardian, or power-of-attorney.

The Missouri statute mimics previous laws in Washington state and Delaware – together, the three laws served as a foundation for model state legislation drafted by the North American Securities Administrators Association (NASAA).

Broker fraud is estimated to cost senior citizens $2.6 billion nationally. The strong relationship between broker-dealers and their clients can play a tremendous role in preventing this exploitation and fraud. Furthermore, St. Louis-based Wells Fargo Advisors, a long proponent of stronger protections against senior exploitation and abuse, advocated for the law. Ron Long, director of the Wells Fargo Advisors’ Elder Client Initiative, stated that now they too can be “an extra set of eyes for government agencies and prevent some of these scams before the money is moved out of the country.”

The attorneys of Eccleston Law LLC represent investors and advisers nationwide in securities and employment matters. Our attorneys draw on a combined experience of nearly 65 years in delivering the highest quality legal services. If you are in need of legal services, contact us to schedule a one-on-one consultation today.

Related Attorneys: James J. Eccleston

Tags: Eccleston, Eccleston Law, Eccleston Law LLC, James Eccleston, Missouri, Elder Fraud Laws, Investment Fraud

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