The North American Securities Administrators Association Inc. of Washington (NAASA) plans a vote by its members by the end of this year on a proposal which would make it a violation of state securities regulations to “misuse, mischaracterize or fraudulently represent a designation that has little or no value,” said the President of NASAA, Alabama securities commissioner Joseph Borg.
Mr. Borg announced the NASAA plan at a hearing being held this week by the Senate Special Committee on Aging. Mr. Borg appeared to testify on matters involving securities fraud of the elderly, and within his presentation he chose to specifically adress the use of questionable senior financial adviser designations.
State securities regulators have authority to take action against financial advisers for unethical sales practices, such as churning and selling unsuitable products, he said. “This would be an enhancement to cover fraudulent use of designations,” Mr. Borg said. NASAA initiative is part of ongoing efforts by state and federal regulators to beef up regulatory authority to protect seniors from financial fraud.
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