News : FINRA Releases Report on its Securities Helpline for Seniors
Washington, DC, USA, Dec 30, 2015 -- The Financial Industry Regulatory Authority (FINRA) released a year-end report on the FINRA Securities Helpline for Seniors, which has fielded more than 2,500 calls and helped investors recover nearly $750,000 in voluntary reimbursements from firms since its launch in April. The report highlights important lessons for investors gleaned from calls and lays out effective practices for firms to consider when working with senior investors.
The report notes that seniors, who can be especially vulnerable, are frequent targets for fraud. This is a growing concern as the number of people 85 years and older is projected to increase more than 50 percent between 2012 and 2030. Moreover, cognitive impairment affects more than 20 percent of adults over the age of 70; and in 2014, retirement assets of those aged 65-74 were estimated at $3.5 trillion, making that population an inviting target for scammers.
Susan Axelrod, FINRA Executive Vice President, Regulatory Operations, said, "FINRA created the Helpline to provide assistance to senior investors for concerns they have with their brokerage accounts and investments, and I am incredibly pleased with the positive impact it has had in just a few short months. The Helpline has also served as a tremendous source of information as we actively engage with seniors, learn of and respond to issues they are experiencing, and use this real-time intelligence to inform our regulatory programs and provide effective practices to firms."
Calls to the Helpline allowed FINRA to identify several emerging scams, including fraud centering on taxes, bogus lottery winnings and binary options, all of which were flagged by FINRA and resulted in investor alerts. Additionally, helpful tips on using BrokerCheck (FINRA’s online tool) before investing and guidance on how to navigate the transfer of an account after the death of a family member were frequent points of discussion with investors seeking help.
The report highlights several cases where investors calling the Helpline were assisted either before becoming the victim of fraud or in recovering funds after they were scammed.
Importantly, the report outlines several effective practices firms should consider implementing to protect seniors. Many of these practices focus on strong policies and supervisory procedures that, for example, prevent brokers from borrowing from clients.
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The report states that firms should consider their size, retail client profile, product offerings, complaints or concerns raised by senior clients, the training of its workforce, and other factors in determining how to design and implement programs and controls to best serve this segment of the investing public.
Investors can obtain more information about, and the disciplinary record of, any FINRA-registered broker or brokerage firm by using FINRA’s BrokerCheck. Investors can also call FINRA's Securities Helpline for Seniors for assistance or to raise concerns about issues they have with their brokerage accounts and investments.
Posted by Veronica Silva Cusi, news correspondent
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About Financial Industry Regulatory Authority:
FINRA, the Financial Industry Regulatory Authority, is the largest independent regulator for securities firms doing business in the United States. FINRA is dedicated to investor protection and market integrity through effective and efficient regulation and complementary compliance and technology-based services. FINRA touches virtually every aspect of the securities business – from registering and educating industry participants to examining securities firms, writing rules, enforcing those rules and the federal securities laws, and informing and educating the investing public.
Published: Thursday, December 31, 2015
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