Bank Employees Must Report Incidents of Financial Elder Abuse

California Law Enacted to Help Combat Financial Elder Abuse

SACRAMENTO, CA — September 2, 2005 — A new California law, (The Financial Abuse Reporting Act, SB 1018), requires employees of banks and credit unions to report suspected financial elder abuse to Adult Protective Services or law enforcement authorities. Health care professionals, social workers, nursing home workers and members of the clergy, are already required to make such reports.

The law will take effect on January 1, 2007, to give bank tellers and officials time to be trained to recognize potential abuse. The training program must include an explanation of what constitutes financial elder abuse, information on how to recognize elder abuse, and a summary of how the adult protective services agency investigates financial elder abuse reports. Bank employees will also be told how to report suspected elder abuse incidents.

Financial elder abuse is generally defined as the improper use of a senior’s funds‚ property or assets. Examples include cashing a check without permission, forging a signature, or convincing an elder to withdraw large sums of money and running off with it. Signs of financial exploitation may include sudden large withdrawals of cash, or transferring the title on a bank account to a new acquaintance. SB 1018 states that “suspected financial abuse” occurs when a bank employee observes behavior or transactions that would lead a person with similar training to form a reasonable belief that an elder is the victim of financial elder abuse.

Bank employees must report suspected financial abuse by telephone immediately, or as soon as possible, and file a written report within two working days with the local adult protective services or law enforcement agency. Banks are subject to a fine of up to $5,000 for failure to report an incident.

“I think this is a bill that will help a particularly vulnerable group of Californians and will make a real difference in [their] daily lives,” said Sen. Joe Simitian (D–Palo Alto), the bill’s author (SF Chronicle, August 30, 2005). “A lot of older people do get ripped off,” Derrell Kelch, executive director of the California Association of Area Agencies on Aging, commented (Sacramento Business Journal, August 29, 2005). “Who’s the first to know that an older person is being taken advantage of financially? In most cases it’s the bank.”

SB 1018 was supported by the American Association of Retired Persons, California; the American Federation of State, County, and Municipal Employees, AFL–CIO; the Alzheimers Association; the California Association of Area Agencies on Aging, the California District Attorneys Association, the State Bar Association of California, and various law enforcement and consumer groups.

California has about 3.6 million people aged 65 and older, and the number is expected to grow as the baby–boomer generation ages. At least 100,000 California seniors suffer from financial abuse each year, according to one estimate (Elder Financial Protection Network).

At Brayton Purcell, we are concerned about the well–being of seniors. We are experienced in all facets of elder abuse law, including financial elder abuse, nursing home violations, and inadequate pain management issues. If you have questions about your legal rights or those of an elderly loved one, either in the community or in a nursing home, please feel free to contact us for more information.

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• At least 100,000 California seniors suffer from financial abuse each year.

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