Securities and Exchange Commission Investor Advocate Rick Fleming wants to protect elderly investors from fraud. Fleming wants the SEC to have a rule protecting elderly investors in case they are defrauded by registered investment advisors.
The Financial Industry Regulatory Authority and the North American Securities Administrators Association have called for rules to stop distribution of funds from retirement accounts in case of financial advisor fraud. Fleming said the SEC is considering following suit.
From ThinkAdvisor.com:
“I haven’t made an official recommendation to the commission or Congress” on a rule for federally registered advisors to “put a pause on transactions” that look to be elder fraud, Fleming said during comments at the MarketCounsel Summit in Miami Beach on Wednesday, “but that’s something I’m looking into.”
Fleming said that his main worry regarding elder fraud is that when looking at demographics, “you have a generation that’s starting to retire, with lots of elderly and a much greater number of seniors suffering from diminished capacity.” What’s more, he added, “boomers are going to be retiring with greater control of their retirement assets than previous generations have. So now we have people retiring that have built up a nest egg that will have control over those assets, at the same time they have diminished capacity issues. I think you could have a recipe for real problems.”
Fleming also expressed in an interest in implementing more frequent financial advisor exams.
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