Your Elderly Loved One Could be a Victim of Financial Abuse
Was your loved one the victim of financial abuse? Perhaps an unscrupulous party took advantage of your mother or father’s age and financial situation. Even worse, maybe the stockbroker in charge of your parent’s financial accounts failed to take action to stop the abuse.
These kinds of scenarios are a lot more common than you might think. Fortunately, a new FINRA rule is trying to make them a thing of the past. On Feb. 5, 2018, FINRA will require stockbrokers to keep an eye out for signs of financial abuse. Brokers will need to maintain the names of trusted contacts for all their clients. They’ll also have the power to stop fund disbursements if they suspect their client has become a victim.
Brokers Liable if They Fail to Stop Financial Abuse
If a broker suspects a client is suffering from age-related mental incapacitation, the broker will reach out to the trusted contact to verify that the client is okay. They might also temporarily stop the disbursement of money to protect the client from further financial injury. Failing to take action to prevent financial abuse like this could cause the broker or firm to be liable for financial damages.
Some Brokers Don’t Want the Increased Responsibility
Some FINRA advisors are worried that it will be difficult to have this conversation with their clients. “We have to be real careful with that, especially with seniors, because it’s a touchy subject,” said one Edward Jones advisor. Nevertheless, many brokerage firms have been collecting names of trusted persons for years in their efforts to curb elder abuse.
There is also the fact that stockbrokers and firms could be subject to increased liability in the event that elder abuse takes place and they fail to prevent it.
Was Your Loved One the Victim of Financial Abuse?
If you suspect that your loved one has suffered from financial abuse, it’s possible that your loved one’s investment advisor and brokerage firm are liable for damages. Contact the Consumer Investor Resource Center at any time and we will let you know what your legal rights and options are.