Transcript for pre-recorded age-friendly banking webinar on OA’s EFE reports and advisories for financial institutions


>> ERIN SCHEITHE: Thank you for joining our webinar on CFPB resources to help financial institutions serve older account holders. This webinar is brought to you by the CFPB's Office for Older Americans. 

Before we begin, I want to read a brief disclaimer. This presentation is being made by a Consumer Financial Protection Bureau representative on behalf of the Bureau. This does not constitute legal interpretation, guidance, or advice of the Consumer Financial Protection Bureau. Any opinions or views stated by the presenter are the presenter's own and may not represent the Bureau's views. 

The CFPB Office for Older Americans develops tools, initiatives and resources to help protect older consumers from financial harm and help them make sound financial decisions as they age. 

>> KATE KRAMER: Let's take a look at CFPB's reports, recommendations and advisories that are specifically designed to support financial institutions in their efforts to prevent and respond to elder financial exploitation. 

Our Advisory and Recommendations or Reports for Financial Institutions on Preventing and Responding to Elder Financial Exploitation was released in 2016. This contains promising practices to enable financial institutions to prevent elder financial abuse and intervene when they recognize it. The key recommendations include:
* To develop, implement, and maintain internal protocols and procedures for protecting account holders from elder financial exploitation
* To train personnel regularly and frequently and include warning signs that may signal elder financial exploitation as well as action steps for prevention and response to use technology to monitor for signs of financial abuse
* To review filtering criteria against individual member's patterns and explore risk factors that may be associated with financial abuse
* To make timely reports to law enforcement and Adult Protective Services regardless of whether it is mandatory or voluntary under state or federal law
* To file suspicious activity reports using the checkbox for elder financial exploitation
* To comply with the Electronic Funds Transfer Act and Regulation E
* To establish procedures so that customers and members can provide advanced consent to share account information with the designated trusted third party if they believe the customer may be at risk of financial abuse. 
You can order bulk print copies of this Advisory and Report and Recommendations to share with your staff if you are interested, or you can also view it online and download the electronic version. 

We released an update to these recommendations in 2019. It is focused on how financial institutions can best report suspected elder financial abuse to the appropriate authorities. This includes an overview of recent federal and state legislative changes, including a review of state laws that authorize transaction holds or delays in disbursing funds when elder financial exploitation is suspected and an overview of the Senior Safe Act. This update also encourages financial institutions to report all cases of suspected elder financial exploitation to relevant federal state and local authorities, such as Adult Protective Services and law enforcement. The update encourages an expedited response if Adult Protective Services, law enforcement, or other government entities request documentation related to an active investigation and encourages financial institutions to provide supporting documentation related to elder financial exploitation SARs to appropriate law enforcement agencies. This also highlights a few key findings from CFPB’s 2019 report that analyzed elder financial exploitation SARs. Let's look a little more closely at that. 

As you may know, the federal Bank Secrecy Act requires reporting suspicious activity that might indicate some sort of financial criminal activity to FinCEN, which is part of the U.S. Department of Treasury. The financial institutions that are required to file SARs include many different types, including banks, credit unions, money service businesses that handle money transfers and wires, broker-dealers, and quite a few others. Access to SARs and even knowledge of its existence is limited to law enforcement and certain financial regulatory agencies. Law enforcement can use the information to trigger new investigations, support ongoing investigations, and identify subjects they may want to investigate further. 

In 2011, FinCEN put out an advisory noting that SARs are a valuable way to report financial exploitation. They talked about some basic signs that could help to spot financial elder abuse. This includes transactional and behavioral red flags. Transactional might mean things like frequent and large withdrawals or uncharacteristic attempts to transfer large sums of money. Behavioral are things that somebody on the front line may notice. For example, an older person comes into a branch with a caregiver and they look uncomfortable or their behavior seems out of character for them. 

In 2013, FinCEN introduced electronic filing of SARs. They also included a new designated category or checkbox for elder financial exploitation. 

Once that checkbox was being used, the Office for Older Americans conducted a report on the use of Suspicious Activity Reports to report elder financial exploitation. We analyzed a limited number of structured data fields involving elder financial exploitation SARs. The timeframe for the analysis was from April 2013 to December 2017. We looked at about 185,000 SARs. The elder financial exploitation SARs include those where the filer selected the elder financial exploitation checkbox or they selected the “other” category under the suspicious activity category and put some variation of the word “elder” in the text box, such as elder abuse or elder financial abuse. We also read full SAR transcripts to help us make findings about the patterns, issues, and dollar amounts. We worked very closely with FinCEN staff. 

We found that elder financial exploitation SAR filings quadrupled from 2013 to 2017, from about 1,300 per month to 5,300 per month. This is a much greater growth than the overall growth rate for all SARs, which was only 40%. The incidents that were reported in the elder financial exploitation SARs likely account for just a tiny fraction of all of the incidents of elder financial exploitation in a given year. 

A few key findings on monetary losses include that when the entire amount reported was a monetary loss, when the older adult lost money, the average amount was about $34,000. And in 7% of the SARs, the amount exceeded $100,000. Losses were greater when the older adult knew the suspect than when the suspect was a stranger. Our analysis indicates that elder financial exploitation is widespread and damaging and there is a need for strong intervention by financial institutions, law enforcement, social services, and policy makers. Please read our SARs report to get more information. 

>> ERIN SCHEITHE: If you would like more information on the CFPB's Office for Older Americans, please visit consumerfinance.gov/olderamericans. If you would like to join our email list, send an email to olderamericans@cfpb.gov. We send emails every so often with helpful resources. Thank you so much for joining our webinar. We hope you have a great rest of your day.