Commerce Committe Holds Meeting on “Fraud and the Elderly”
May 21, 2013 by NAFA Staff
On May 16th, the House Energy and Commerce Committee held a hearing titled “Fraud on the Elderly: A Growing Concern for a Growing Population.” Witnesses included the GAO, FTC, FBI, CFPB and Vermont AG. Excerpts from written statements from the GAO and CFPB follow:GAO
- Exploitation by financial services professionals: Older adults may consult with a variety of financial professionals, such as financial planners, broker-dealers, and insurance agents. However, older adults, similar to other consumers, may lack the information to make sound decisions about choosing a financial services provider and protecting their assets from exploitation.
- Federal agencies have made some efforts to provide safeguards to prevent exploitation by financial services professionals, which was cited as a challenge by public officials in all four states we visited. When it comes to preventing the sale to older adults of unsuitable or fraudulent investments, SEC and CFPB have each taken steps to help older adults avoid being exploited.
- The report, entitled “Senior Designations for Financial Advisers: Reducing Consumer Confusion and Risks”, found that some financial advisers (with senior designations) target older consumers for the sale of inappropriate and sometimes fraudulent financial products and services. We found that financial advisers use senior designations which imply that they have advanced training or expertise in the financial needs of older consumers-and that consumers are confused by the names and acronyms these advisers use.