ATTORNEY NEWSLETTER
FINRA Prosecutions For Fraud
Case Example
Protections And Remedies
The Financial Industry Regulatory Authority (FINRA) is a non-governmental entity that governs the financial industry from within. FINRA polices member investment firms for compliance with regulations meant to ensure integrity in financial markets and protect consumers from fraud or deceptive practices. As part of its consumer protection efforts, FINRA has a set of rules designed to protect seniors from financial exploitation. See, e.g., FINRA Rules 4512 (Customer Account Information) and Rule 2165 (Financial Exploitation of Specified Adults) and Regulatory Notice 17-11 (SEC Approval of Rules Relating to Financial Exploitation of Seniors). While FINRA and individual institutions rules about financial exploitation of seniors are important, those rules only go so far and do not guarantee that a senior who is financially exploited by a broker or anyone accessing the senior’s accounts for their own personal gain, will be made whole. That’s where an experienced financial elder abuse attorney comes in. Victims of financial elder abuse have additional rights and remedies under State law which exceed any protections under FINRA, and elder counsel can help you pursue all those remedies, including awards of attorneys’ fees and expenses for bringing suit. Cal. Welf. & Inst. Code § 15657.5. If you or an older loved one have been the victim of financial elder abuse in Santa Clara County call us today at (415)441-8669. Our toll-free number is 1-888-50EVANS (888-503-8267).
Insurance Agent Fraud
In one recently reported case,[1] FINRA has accused a former Pruco Securities advisor of forging electronic signatures on annuity products to rake off more than $500,000 in commissions for himself. The agency alleged that the California life insurance agent forged 115 annuity applications for 64 customers, receiving advance payment commissions even though the annuities, mostly variable products, were never funded. The agency also alleged that he did this without the customers’ knowledge or consent. “In total, [the agent] received $511,609.74 in commissions to which he was not entitled,” said FINRA in its complaint. In doing so, the agency claimed he violated its Rule 2010 against forging customer signatures and converting funds.
None of the customers had given the agent permission to submit the applications or sign their names and were not aware that he was doing so, the complaint said. The agent allegedly signed customers names on the annuity applications using electronic signature software.
Protecting Older Loved Ones
Whenever a new financial advisor or insurance agent approaches you or an older loved one, always run a background check on the individual and the firm he or she claims to work for. You may be able to spot earlier violations or charges brought against that individual. To safeguard your older loved one from financial abuse, review all financial records and bills continually. Accompany older loved ones to any meetings they have with insurance agents, financial advisors, or planners. Do not let them sign over any benefits or write any checks without your oversight. Review anything they are asked to sign. Unscrupulous insurance agents, advisors and others prey on seniors quickly. One meeting alone can be disastrous. Discourage them from attending free lunch seminars and other high-pressure sales gatherings. Most importantly – never ever allow the senior to give a caregiver, insurance agent or advisor a Power of Attorney or a blank check. If you suspect abuse, call elder law counsel to help you pursue all available remedies against anyone responsible for abuse, including an award of attorneys’ fees and costs for bringing your suit under Cal. Welf. & Inst. Code § 15657.5.
Contact Us
If you or someone you love is the victim of any type of financial elder abuse in Santa Clara County or elsewhere in California, call Ingrid M. Evans at Evans Law Firm, Inc. at (415) 441-8669, or by email at <a href=”mailto:info@evanslaw.com”>info@evanslaw.com</a>. Our toll-free number is 1-888-50EVANS (888-503-8267).
[1] Evans Law Firm, Inc. was not involved in the reported case in any way. FINRA publicly released the complaint in February.
