Violations of State and Federal Law

It’s heartbreaking, but it happens: The elderly are prime targets for unscrupulous individuals seeking to take advantage of vulnerable individuals. In particular, many seniors find themselves the victims of financial fraud at the hands of their financial advisor – the person responsible for protecting and nurturing an individual’s life savings.

While there is no federal statute specifically addressing elder abuse, there are securities and investment fraud laws that apply to scenarios of elder financial exploitation. The Securities Exchange Act of 1934 rule 10b5 makes it illegal for anyone to use any measure – either directly or indirectly – to defraud, make false statements, withhold relevant information, or conduct business operations meant to deceive another person when involved in the transaction of stocks or other securities. This law enables the Securities and Exchange Commission (SEC) (as well as the Financial Industry Regulatory Authority (FINRA)) to investigate security fraud claims.

On the state level, many states have laws pertaining specifically to elder abuse as well as securities fraud, such as Florida’s State Securities Law 517.301. This law protects Florida investors from unscrupulous stockholders and other investment frauds.

Chapter 825 of the Florida Statutes explains what financial abuse of the elderly means, along with the penalties associated with violating the statute. Financial exploitation of the elderly is defined as:

• Knowingly obtaining or using an elderly individual’s funds or assets to deprive the individual the use of the funds
• Obtaining or using an elderly individual’s assets or funds while knowing (or should reasonably know) that the elderly person lacks the capacity to understand or give consent
• Breaching a fiduciary duty to an elderly person that results in an unauthorized sale, transfer, or appropriation of property
• Misappropriating, misusing, or transferring an elderly individual’s money without authority
• When a caregiver or trusted individual intentionally or negligently fails to use an elderly individual’s income and assets to provide the support and maintenance necessary for the well-being of the elderly person

An example of elder financial exploitation is when a broker makes unauthorized, excessive, or unsuitable trades on an individual’s account that result in depriving the client of his or her funds.

Overall, elder abuse is defined by the State of Florida as:

• Intentionally causing physical or psychological injury to an elderly person
• An intentional act that could reasonably result in physical or psychological injury to an elderly person
• Actively encouraging a person to commit an act that results in or could reasonably result in physical or psychological injury to an elderly person

Taking the example a step further, if a financial advisor exploits an elderly investor by depriving them of their assets, this could cause psychological injury or limit their access to quality medical care.

Elderly victims of abuse and exploitation have rights. If you or a loved one feel that you have been wronged due to elder financial fraud, you may be able to recover some or all of your losses through litigation or securities arbitration.

The attorneys at Silver Law Group are leaders in the field of securities arbitration and elder financial fraud. Our attorneys are well-versed in all federal and state laws that protect the elderly, and we represent individual and institutional investors across the United States who have lost money at the hands of a trusted financial advisor. Contact us today to discuss your options.