Regulators look to industry to protect seniors

A trio of U.S. regulators have launched a new training resource for the securities industry that aims to help firms ensure their reps are prepared to protect vulnerable investors.

The U.S. Securities and Exchange Commission (SEC), the Financial Industry Regulatory Authority (FINRA) and the North American Securities Administrators Association (NASAA) have together announced the provision of a program designed to help firms train their personnel in detecting, preventing and reporting the exploitation of older, vulnerable investors.

The free training program is also intended to help firms meet requirements under legislation that gives financial institutions — including broker-dealers, investment advisers and their employees — immunity from liability for reporting instances of suspected financial abuse of senior investors.

Those immunity provisions require that employees are trained in how to identify and report suspected exploitation against seniors before making a report.

“By partnering with FINRA and NASAA to offer this training program, we can help educate financial professionals on how to identify and report financial abuse of older adults,” said SEC chair, Gary Gensler, in a release.

In Canada, the Canadian Securities Administrators (CSA) has proposed rule changes that aim to enlist the securities industry in combatting suspected exploitation of senior investors by requiring firms to get clients to name a “trusted contact person,” and also enabling firms to place a temporary hold on transactions in cases where financial exploitation is suspected.

James Langton

James is a senior reporter for Advisor.ca and its sister publication, Investment Executive. He has been reporting on regulation, securities law, industry news and more since 1994.