STOCKBROKER PROBLEMS
Financial Exploitation of the Elderly
Seniors often fall prey to unscrupulous brokers who disregard their investment goals and tolerance for risk. Misleading “free lunch” sometimes promote the sale of financial products that are often completely unsuitable for seniors.
The elderly are the fastest growing segment of our society and they are also the financial backbone to our country’s economy. They are living longer and need to save more than ever before. We as a society do not always recognize the threats to this vulnerable population. Threats include physical and mental health issues such as stroke, Alzheimer’s, isolationism, and other causes still exist in spite of our best efforts to protect our seniors.
Victims of elder abuse often live alone, may be in poor health, and frequently suffer from diminished mental capacity. These conditions make them at risk to exploitation through undue influence or duress by brokers and brokerage firms. They are easily swayed and are likely to place their entire estate in control of befriending suspects.
Undue influence is when people use their role and influence to exploit the trust, dependency, and fear of others. Brokers often use this power to deceptively gain control over the decision making of the second person.
There is a lack of training, expertise and resources to properly investigate, prosecute, and litigate these cases. For example, most states lack legislation to address consent by victims who may be subject to undue influence or duress.
It is imperative that such matters in involving victims suffering from dementia, subject to undue influence or duress be handled with same attention, sensitivity, and resources given to juvenile and domestic violence crime victims. Protection of the elderly requires that we must continue to take care of those who have taken care of us.