With the exception of those of you who have literally been asleep for the last few years, you are well-versed in the attention FINRA and the SEC are giving to issues surrounding elder investors. Among other things, there is a real focus on elder abuse.
Some commentators believe that all of this attention may inevitably lead to additional regulations regarding how you handle older investors. Like most things from a regulatory/legislative standpoint, the loudest wheel will get the most oil.
With the graying of the baby boomers, this section of society will undoubtedly have a large voice in whatever regulations or laws may come to pass. It seems as though most of the claims I have defended over the last 20 years have involved investors over the age of 60 such that I can say there is a real issue with how firms handle older clients.
Is there anything that can be done to avoid this potential regulatory headache? I think that there are things that can be done on both a macro and micro level.
The macro solution requires firms to take a big picture view of its customer composition. Assuming that there is a graying component to your customer base, you should have specific firm-wide policies and procedures that address elder issues; i.e., heightened supervision, alternate decision-makers, a committee that addresses elder issues, etc.
The micro solution is tied to the macro and can be addressed by a simple question. What are you as a firm doing to ensure your policies and procedures pertaining to elder investors are being carried through as written by your advisors/representatives? If you cannot answer this question, you might as well be signing off on those regulations.
Avoiding elder client regulations may still be in your hands. Are you doing enough to address the issue at your firm? Only time will tell.
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