Regulations Are Mute Concerning Client Bequests to Brokers
After a Maryland financial advisor inherited $500,000 from an elderly client, lawmakers have asked the governing body of the securities industry, the Financial Industry Regulatory Authority (FINRA), to provide guidance over whether and how brokers can inherit wealth from customers, especially senior investors.
Led by Nevada Senator Catherine Cortez Masto, the lawmakers sent a letter to FINRA President and CEO Robert W. Cook asking the agency to set guidelines for broker-dealer which would “curb the ability of broker dealers and other financial professionals to inherit from their clients.” Currently FINRA rules and regulations do not explicitly bar brokers from client bequests.
Part of a Nationwide Push to Protect Senior Investors from Abuse
The call from lawmakers to look more closely at the relationship between elderly clients and financial advisors is one part of a grand national movement by the government. non-profits, and regulators to reduce the staggering amount of elder financial abuse that occurs in this country. According to recent estimates, senior Americans lose more than $80 per year to financial scams and fraud. The ways in which this happens are legion. However, the often tangled relationship between financial advisors and clients has received an increasingly amount of attention from regulators and legislators who recognize that brokers have a unique position in terms of their access to and influence over especially aging clients.
Pennsylvania & New Jersey Securities Law Firm
If you or someone you know has been the victim of elder financial abuse or fraud, please contact our securities litigation team immediately for a free consultation toll-free at 215 462 3330 or by using our online contact form.