1. Senior and Elder Investors
Who Are They, What To Do
Stephen P. Wilkes, Esq.
300 Montgomery Street, Suite 600, San Francisco, CA 94104

2. Agenda Introduction SEC/FINRA Exam Priorities
National Senior Investment Initiative
Other Regulatory Guidance
FINRA Rules 2165 and 4512 – Effective February 5, 2018
Senior Designations
Legislation/Enforcement

3. Introduction State the obvious: population is aging
Financial advisers have duty under Advisers Act, FINRA Rules
Who are the “aged”, the “senior” the “elderly”?
Mental state – is client mentally acute? Diminished capacity?
Abuse

4. Exam Priorities SEC 2017 Examination Priorities
Focus on risk specific to elderly and retiring investors
ReTIRE; Public Pensions; Seniors
program-priorities-2017.pdf
FINRA 2017 Examination Priorities
Senior Investors; Penny Stock
examination-priorities-letter

5. National Senior Investment Initiative
SEC OCIE/FINRA Collaborative Exams
Swept 44 broker dealers
Investment products, suitability, training
13% - procedures for diminished capacity
33% - suitability guidelines for seniors
Assessed practices and procedures
initiative

6. FINRA Notice 07-43 Obligations to senior investors
Suitability, best practices, communication,
Financial abuse, diminished capacity

7. NASAA Rule NASAA adopts Model Rule
Guidance for state registered advisers
Requires “qualified individuals” to notify state in event of abuse
Generally covers age 65 +
act-to-protect-seniors-and-vulnerable-adults/

8. Securities Helpline for Seniors
FINRA toll free number
securities-helpline-seniors

9. SEC Investor Bulletin
Investor bulletin educates about planning for diminished capacity
How to help others
bulletins/ib_illness.html

10. FINRA Notice 11-52
Use of certifications and designations that imply expertise

11. FINRA Notice 17-11 Amends Rule 4512 Adopt Rule 2165
Specific account information, reasonable effort to identify a “trusted contact”
Disclosure of ability to contact the “trusted contact”
Adopt Rule 2165
Safe harbor temporary hold
Required steps, time limits, record retention
Supervision
Notice pdf

12. Legislation/Enforcement
Many states define exploitation, trend
SEC charges penny stock scam in “spongebuddy” product in Florida on 11/30/17

13. Best Practices Define elderly, senior, cognitive issues as policy
Monitor accounts, emergency action plans
Training
Titles and certifications
Document friendly account opening
Suitability
Disclosure

14. Resources
See Appendix A National Senior Investor Initiative, page 33

15. Important Information
This presentation is intended for general informational purposes only, and it does not constitute legal, tax or investment advice from The Wagner Law Group.

16. Senior and Elder Investors
Who Are They, What To Do
Stephen P. Wilkes, Esq.
300 Montgomery Street, Suite 600, San Francisco, CA 94104