WASHINGTON (8/3/12)—While reporting laws differ from state to state, this month's edition of Credit Union Magazine noted that many states are passing laws targeting elder financial abuse and there is a growing trend toward requiring mandatory reporting of possible elder financial abuse cases.
Fairfax, Va. law partners David Reed and Bruce Jolly in their Credit Union Magazine article outlined some of the steps credit unions can take to help them identify instances of elder financial abuse and report them to the proper authorities.
Potential signs of elder financial abuse can include large ATM withdrawals, debit transactions that are not consistent with a customer or member's normal activities, and sudden non-sufficient fund activity. Credit unions and other financial service providers should also be aware of caregivers that take a sudden interest in a senior citizen's financial activities, caregivers that attempt to speak for the senior citizen, or caregivers that refuse to leave a senior citizen's side when they are discussing financial matters.
Reed and Jolly noted that Maryland law requires financial institution employees that have observed potential elder financial abuse to file a report with that state's office of adult protective services or law enforcement agencies. However, Virginia law is more permissive, merely stating that employees that observe potential abuse may report the incident to state authorities.
Reports should include basic information on the accountholder and the individual that is suspected of abuse, and details on the nature of the abuse. Credit unions can base their elder financial abuse reporting programs on their existing Bank Secrecy Act and Identity Theft Red Flag compliance programs, the article said.
Reporting forms can be developed independently, or based on existing state reporting forms. Credit unions should also identify who on their staff is responsible for identifying possible elder financial abuse incidents, who will report those incidents, and who will have access to any filed reports.
Some states require staff to be trained in elder financial abuse detection and prevention. The Credit Union Magazine article suggested that credit unions could first focus on complying with state training requirements, and then expand the scope of their training as needed.
Credit union employees that file elder abuse reports are protected from legal retaliation in many states, the article noted.
Recent Consumer Financial Protection Bureau (CFPB) efforts to address elder financial abuse were also addressed in the article. That agency has asked for information on any resources that are provided to help seniors vet financial advisors and planners they may hire. Information on how financial education, financial counseling and management programs can be tailored to meet the needs of senior citizens and those that care for them has also been requested by the CFPB.
Around $2.9 billion was stolen from financially exploited senior citizens in 2010, according to CFPB estimates. Reported instances of financial theft from seniors grew by 12% between 2008 and 2010, the agency said.