Earlier this month, the Consumer Financial Protection Bureau issued an advisory to banks and lending institutions regarding the reporting of financial exploitation of older consumers. The advisory, which can be found here, is actually an update to a 2016 report on the same subject.
“The bureau is renewing its efforts to alert banks and credit unions to elder financial exploitation as they are uniquely positioned to detect that an older account holder has been targeted or victimized, and to take action,” CFPB Director Kathy Kraninger said upon release of the report.
The bureau encouraged institutions to help protect elders by reporting suspected elder financial exploitation to the appropriate local, state and federal authorities. In particular, the CFPB recommends filing Suspicious Activity Reports in such cases. The bureau noted that each state has different requirements and formats for reporting suspected elder abuse.
In addition, the bureau reminded affected entities that the Senior Safe Act, which became effective this June, protects financial institutions from liability when disclosing suspected EFEs to covered agencies.
The report covered a spectrum of voluntary best practices to assist financial institutions. These practices included: developing and implementing internal protocols and procedures for protecting account holders from elder financial exploitation; the training of management and staff to prevent, detect, and respond to suspicious events; detecting elder financial exploitation by harnessing technology; reporting all cases of suspected exploitation to relevant federal, state and local authorities; protecting older account holders by complying with the Electronic Fund Transfer Act and by offering age-friendly services that can enhance protections against financial exploitation; and collaborating with other stakeholders such as law enforcement, adult protective services, and service organizations.
In February 2019, the CFPB published a research report, Suspicious Activity Reports on Elder Financial Exploitation: Issues and Trends. In it, the CFPB analyzed SARs filed by a broad spectrum of financial institutions from 2013 to 2017 regarding suspected EFEs.
According to the bureau, over 180,000 SARs describing suspicious activities targeting older adults were filed during this timeframe. SAR filings quadrupled from 2013 to 2017, but these SARs likely represent a tiny fraction of actual incidents, the bureau noted. During the study time period, SAR filings by depository institutions increased each year.
SARs indicate that EFE is widespread and damaging, with an average loss of $41,800 among adults over age 70 who sustained a loss.