Reporting Suspected Financial Exploitation of Vulnerable Adults

Under RSA 421-B:5-506-A, securities brokerage firms and investment advisers, as well as their representatives, may delay the disbursement of funds from an investment account for a limited time if they reasonably believe it could result in the financial exploitation of a vulnerable adult.

State law defines a vulnerable adult as an individual over the age of 65 who is unable to manage personal, home, or financial affairs or delegate such responsibilities.

Reporting process

To delay the disbursement of client funds under this law, the investment firm or its representative must do the following:

1. Review the requested disbursement and suspected financial exploitation prior to any delayed disbursement.
    
2. The person’s firm may contact the third party previously designated by the eligible adult.
    
3. Within two business days after the disbursement request, the reporting firm should:

• Provide written notification of/reason for delay to parties authorized to transact business on the account (unless a party is believed to have engaged in the suspected/attempted financial exploitation).
   
• Notify the Bureau of Securities Regulation (“the Bureau”) of the delay and complete and return the Report of Suspected Financial Exploitation of Vulnerable Adult. Along with the report, firms should also provide all relevant documents and information to the Bureau, including:
   
• • Account statements; 
  • Copies of complaints;
  • Communications and statements taken related to the delay;
  • Internal investigation reports;
  • Powers of attorney or other legal documents, as applicable, giving someone beside the account owner authority over the account.

4. Within seven days after the delayed disbursement and an internal review of suspected/attempted financial exploitation, the reporting firm should report the results of the review to the Bureau.
    

Disbursement of funds

The reporting firm has up to 15 business days from the date of delay to decide whether there has been financial exploitation and may release the funds unless the Bureau requests the broker dealer or investment adviser extend the delay.

• The disbursement shall then be delayed no more than 25 business days after the date of the delayed disbursement, unless sooner terminated by the Bureau or court order. 
   
• The reporting broker dealer or investment adviser is required to contact the Bureau prior to releasing the funds.
   
• A court may extend the delay or order other relief at the request of the Bureau or the firm.
   

Please be advised that the Bureau may request other documents, at its discretion, as part of its review.