US Senators Herbert Kohl (Wisc) and Robert Casey (Pa) have introduced the Senior Investor Protections Enhancement Act, a bill that would add a $50,000 fine to any penalties that came with defrauding investors over 62 years of age. The legislation defines a senior as anyone 62 years of age or older. This is the age group that the majority of retirement savings can now be accessed for investments.
The two men emphasized that while seniors over 65 control about $15 trillion, over 50% of complaints made to state securities regulators come from this age group.
The bill proposes the additional penalty for every securities law violation that directly targets or is committed against a senior investor. However, it won’t intervene with situations involving legitimate investment advisors that make appropriate investment recommendations to their elderly clients.
Examples of actions that could result in the $50,000 penalty include failure to disclose fees, selling investment products that are unsuitable for seniors, switching investments sold with the investment that was marketed, and “locking-up” cash or penalty charges.
Senator Kohl is the head of the Senate Special Committee on Aging. The group is reporting that many seniors have lost their life savings because they were targeted by salespersons for investment schemes.
Last month, Financial Industry Regulatory Authority CEO Mary Schapiro says that FINRA is worried that senior investors that are facing financial or economic difficulties may become victims of investment schemes if they opt for high-stake investments to recover their losses. She stated that risks could be especially high for senior investors that may not have the luxury of time needed to recover if such losses do result.
If you are a senior investor that is a victim of investment fraud or because your broker-dealer made inappropriate product recommendations to you, contact Shepherd Smith Edwards & Kantas LTD LLP today.
Related Web Resources:
The Senior Investor Protections Enhancement Act of 2008, Washingtonwatch.com (Read the Bill)