STATE & FEDERAL LAW RE:
FINANCIAL EXPLOITATION OF THE ELDERLY
MANDATORY REPORTING BY
BANKS & FINANCIAL SERVICE PROVIDERS
WORLD ELDER ABUSE AWARENESS DAY 2012
June 11, Slidell, LA
June 13, Acadiana (revised)
Donald Akers, Jr.
Assistant District Attorney
16th Judicial District of Louisiana
PROTECTING THE ELDERLY
FROM FINANCIAL EXPLOITATION
THE ROLE OF BANKS & FINANCIAL SERVICES
 Play a key role due to the nature of their customer
relationship.
 Because of personal familiarity with customers,
they are quick to suspect elder financial and alert
authorities
 Reporting financial exploitation has had increased
attention at the state level, a focus consistent with
an upward trend at the federal level…
SOURCE: US Dept. of Treasury, Financial Crimes Enforcement Network, Advisory FIN-2011-A003/
Issued: February 22, 2011
MANDATORY REPORTING !
• Reports ...shall be made to any adult protection agency or to
any local or state law enforcement agency...
• All reports shall contain the name and address of the adult,
the name and address of the person responsible for the care
of the adult, if available, and any other pertinent information.
• The adult protection agency shall have access to any
financial
records
necessary...without
unnecessary
delay...and is exempt from the payment of fee otherwise
required or authorized by law to obtain a record...
• If the adult protection agency is unable to obtain access to a
record ...the court shall order access...
WHAT ARE WE REPORTING?
LOUISIANA LAW:
MANDATORY REPORTS REQUIRED FOR ALL
La. R.S. 15:1504 MANDATORY REPORTS AND IMMUNITY
• ANY PERSON...having cause to believe that an adult's
physical or mental health or welfare has been or may be
further adversely affected by abuse, neglect, or exploitation
SHALL REPORT IN ACCORDANCE WITH R.S. 15:1505.
• ...any person who in good faith makes a report, cooperates
in an investigation by an adult protective agency, or
participates in judicial proceedings authorized under the
provisions of this Chapter...shall have immunity from civil
or criminal liability…
WHAT IS EXPLOITATION OF THE ELDERLY?
LA R.S. 15:1503: (EPS/APS Statute Definitions)
(7) "Exploitation" means the illegal or improper use or management
of an aged person's or disabled adult's funds, assets, or property, …
power of attorney or guardianship for one's own profit or
advantage.
LA R.S. 14:93.4. Exploitation of the infirmed (Criminal Law)
(1) The intentional expenditure, diminution, or use…of the property or
assets of the infirmed, a disabled adult, or an aged person…without
the express voluntary consent…by means of fraudulent conduct,
practices, or representations.
(2) The use of an infirmed…aged person's, or disabled adult's power of
attorney or guardianship for one's own profit or advantage by
means of fraudulent conduct, practices, or representations.
PENALTIES FOR EXPLOITATION OF THE INFIRMED
LA R.S. 14:93.4
A FELONY
 shall be fined not more than $10,000 or imprisoned, with
or without hard labor, for not more than 10 years, or both
 shall be prohibited from access to any disabled or aged
person's assets or property…
 Shall be prohibited from having a power of attorney or
being guardian for any disabled or aged person…
 shall not prohibit the offender from inheriting from the
victim
LA R.S. 14:67.21 THEFT OF THE ASSETS
OF AN AGED OR DISABLED PERSON
• “Aged person" is any person 60 years or older (EPS
Jurisdiction)
• "Disabled person" is a person 18 years or older who
has a mental, physical, or developmental disability ….
(APS Jurisdiction)
• The intentional use… management or appropriation
of funds, assets or property...misuse of a power of
attorney...or through fraudulent scheme…
PENALTIES FOR THEFT OF ASSETS OF ELDERLY
LA R.S. 14:67.21
 Value of $300 or less, MAY be imprisoned up to 6 months
in prison and up to $500 (Misdemeanor)
 Value of $300+ to $500, MAY be imprisoned up to 2 years
in prison, with or without hard labor and up to $2000 fine
(Felony)
 Value of $500+, MAY be imprisoned up to 3 years in
prison, with or without hard labor and up to $3000 fine
(Felony)
 2nd conviction, SHALL be imprisoned, with or without
hard labor, up to 2 years and up to two thousand dollars
(Felony)
 Offender shall make full restitution to the victim
OTHER CONSIDERATIONS:
RECOVERY OF FUNDS AND RESTITUTION ISSUES
TIME IS OF THE ESSENCE !
‘’When they’re gone, they’re gone!! ’’
Criminal Prosecution and Convictions
are the best means of having restitution made to the victim and
with no legal fees or costs
Civil Recovery and Judgments (‘’Its a Civil Matter ’’)
a method of recovery and restitution available but statutes of
limitation often bar suit and there are no exceptions or extensions
for the elderly and infirm
• Perhaps it is time to review an exception or extension of time limits
for this class of persons in the civil law!
Statue of Limitations for Criminal Prosecution
• Louisiana Code of Criminal Procedure Article 572
• MISDEMEANOR:
– Theft of Assets of Aged/Disabled valued < $300.00
2 years from commission of offense
• FELONY:
– Theft of Assets of Aged/Disabled valued > $300
– Exploitation of the Infirmed
4 years from commission of offense
STATUTE ADDED 2010
• LA CODE OF CRIMINAL PROCEDURE ARTICLE 573.1
RUNNING OF TIME LIMITATIONS; EXCEPTION; EXPLOITATION
OF THE INFIRMED
The time limitations established by Article 572 shall
not commence to run as to the crime of exploitation
of the infirmed (R.S. 14:93.4) until the crime is
discovered by a competent victim, or in the case of
an incompetent victim, by a
competent third
person.
Acts 2010, No. 317, §1.
Why Was The Statute Added ?
(1) La. R.S. 14:93.4 is designed to protect persons who are most
often unable to know that they are being exploited or fear
loss of independence or institutional care if they report the
exploitation.
(2) The relationship of many perpetrators to the victim is such
that trust is misplaced or the perpetrator is able to isolate
the victim and financial resources from access by others.
(3) Exploitation is often discovered long after the 4 year
prosecution period has passed such as during an
examination of records for a “long term care Medicaid”
application’s “look back period of 5 years”; or when a
victim has died and succession proceedings provide access
to financial records.
IMMUNITY, CONFIDENTIALITY and
CONSEQUENCES OF FAILURE TO REPORT
• No cause of action shall exist against any person or
agency who in good faith provides a record or
document to the adult protection agency
• The identity of any person who in good faith makes
a report of abuse, neglect, exploitation, or extortion
shall be confidential and shall not be released
without the handwritten authorization of the
person making the report.
• a person who knowingly fails to report abuse may be
liable for fines and/or imprisonment.
FEDERAL FINANCIAL PRIVACY LAW
Financial Exploitation Reports are Exempt
• The Federal Right to Financial Privacy Act of 1978
does not apply to reports made to state or local
authorities.
• 31 U.S.C. sec. 5318 (g) (3) A: Any financial institution
that...makes a disclosure pursuant to this subsection
or any other authority...shall not be liable to any
person under any law or regulation of the United
States, any constitution, law, or regulation of any
State or political subdivision of any State…
THE RIGHT TO FINANCIAL PRIVACY ACT
12 U.S.C. 3403 (c)
(Federal)
• Nothing in this title shall preclude any financial
institution...,from notifying a Government authority that
such institution...has information which may be relevant to a
possible violation of any statute or regulation.
• Any financial institution, or officer, employee, or agent
thereof…shall not be liable to the customer under any law or
regulation of the United States or any constitution, law or
regulation of any State or political subdivision thereof, for
such disclosure of or any failure to notify the customer of
such disclosure.
THE FINANCIAL SERVICES MODERNIZATION ACT
(GRAMM-LEACH-BLILEY ACT)
Exempts from its privacy protection and notification to customers
requirements:
Disclosure “to protect against or prevent actual or potential fraud,
unauthorized transactions, claims, or other liability.”
Disclosure “to the extent specifically permitted or required under
other provisions of law…to law enforcement agencies…or for an
investigation on a matter related to public safety.”
Disclosure “to comply with Federal, State, or local laws, rules, and
other applicable legal requirements.”
United States Department of The Treasury
Financial Crimes Enforcement Network
Advisory FIN-2011-A003/ Issued: February 22, 2011
Subject: Advisory to Financial Institutions on Filing Suspicious Activity Reports
Regarding Elder Financial Exploitation
•
•
•
•
•
Key Areas Addressed by the Advisory Opinion
Financial institutions can play a key role
This advisory contains examples of "red flags“
Older Americans hold a high concentration of wealth
SARs continue to be a valuable avenue to report elder financial
exploitation.
Filers should continue to report all forms of elder abuse according
to institutional policies and the requirements of state and local laws
and regulations,
Louisiana Bank Disclosure Law
Linked to the Federal Law
The Louisiana Banking Law, La. R.S. 6:333, provides:
• F. The following disclosures by a bank or any affiliate are
hereby specifically authorized and,…nothing in this
Section shall prohibit, restrict, or otherwise apply to:
• (11) The disclosure by a bank …of financial records …in
accordance with the provisions of 12 U.S.C. 3401 et seq. or
15 U.S.C. 6801 et seq.
• (12) The disclosure by a bank… of financial records …in
accordance with the provisions of Title 31 U.S.C.
HOW CAN BANKERS AND FINANCIAL
SERVICE PROVIDERS HELP ?
• Train and sensitize employees about financial exploitation so that
they recognize and report it
• Designate a staff person whom employees must notify when
questionable or illegal financial transactions are occurring
• Develop a protocol for reporting suspected financial exploitation
to law enforcement or Adult Protective Services
• Train customer service specialists in interview techniques of elder
customers
• Educate customers about how to recognize the signs of
exploitation
SIGNS OF FINANCIAL EXPLOITATION
• A relative or caregiver with no means of support who is suddenly
interested in the elder's finances
• The elderly person's bills are not being paid
• A relative or caregiver who isolates the elder
• The elder is unaware of or unable to explain their finances
• Bank and credit card statements are sent to the relative or caregiver
• The elder is concerned about missing money
• Suspicious signatures on checks
• A legal document, such as a will or power of attorney, is drafted without
fully understanding by the elder
METHODS OF FINANCIAL EXPLOITATION
• Taking or giving money or assets without permission or by
force or intimidation
• Borrowing money and not paying it back
• Misusing ATM or credit cards
• Joint Bank Accounts where the offender's name is added to the
an account
• Misusing the power of attorney or forcing the victim to agree to
unintended purposes
• Living Trusts and Wills: becoming the manager, trustee or
beneficiary
For Further Assistance
Contact Information:
• Donald D. Akers, Jr.
Assistant District Attorney, Elderly Protective Services
16th Judicial District of Louisiana
300 Iberia Street, Courthouse Suite 200
New Iberia, LA 70560-4583
Phone: 337-369-4420
Direct Ph: 337-365-3886
Direct Fax: 337-365-3886
• Additional Ph: 337-367-8451
Alternate Fax: 337-365-7034
email: dakersjr@cox.net
FIN-2011-A003 Indicators of Elder Financial Exploitation
Erratic or unusual banking transactions, or changes in
banking patterns:
– Frequent large withdrawals, including daily maximum
currency withdrawals from an ATM;
– Sudden Non-Sufficient Fund activity;
– Uncharacteristic nonpayment for services, which may
indicate a loss of funds or access to funds;
– Debit transactions that are inconsistent for the elder;
– Uncharacteristic attempts to wire large sums of
money;
– Closing of CDs or accounts without regard to penalties
Interactions with customers or caregivers:
•
A caregiver or individual shows excessive interest does not allow the elder to
speak or is reluctant to leave the elder’s side during conversations;
•
The elder shows an unusual degree of fear or submissiveness toward a
caregiver, or expresses a fear of eviction or nursing home placement if money
is not given to a caretaker;
•
The financial institution is unable to speak directly with the elder, despite
repeated attempts to contact him or her;
•
A new caretaker, relative, or friend suddenly begins conducting financial
transactions on behalf of the elder without proper documentation;
•
The customer moves away from existing relationships and toward new
associations with other “friends” or strangers;
•
The elderly individual’s financial management changes suddenly, such as
through a change of power of attorney to a different family member or a new
individual;
•
The elderly customer lacks knowledge about his or her financial status, or
shows a sudden reluctance to discuss financial matters.