On May 6, 2019, the Consumer Financial Protection Bureau (CFPB) released an identity theft protection guide entitled “Protect Your Identity: What Older Customers Should Know” (Protection Guide) and on July 17, 2019 released “Reporting of Suspected Elder Financial Exploitation by Financial Institutions” (an update to the Advisory and Recommendations issued in 2016). Through the release of these tools for consumers the CFPB is hoping to educate elder consumers on preventative actions they can take to protect themselves, while the update to the Advisory and Recommendations for financial institutions will further help financial institutions prevent, detect, and respond to suspicious events.
According to a February 2019 report, “Suspicious Activity Reports on Elder Financial Exploitation: Issues and Trends,” between 2013 and 2017 there were more than 180,000 SARs filed, involving more than $6 billion, related to suspected elder financial abuse. The CFPB reinforces the need for consumers – particularly elder adults who are more susceptible to exploitation – to protect their sensitive personal information. The CFPB also notes financial institutions play an important role in educating consumers and identifying when a consumer has been a victim of financial abuse.
EDUCATION:
The CFPB’s Protection Guide outlines five key ways individuals, including older adults, can guard against identity theft, including:
- A security freeze prevents new creditors from accessing your credit file and others from opening accounts in your name until you lift the freeze. This makes it harder for identity thieves to open new financial accounts in your name.
- A regular review of your bank and credit card statements catches transactions that don’t look right and allows you to alert your bank promptly.
- A review of your credit reports will help you find possible mistakes. You can either check once a year or, since there are 3 major credit reporting agencies, check one report every 4 months. You can then dispute the incorrect information with the credit reporting agency.
- A fraud alert adds an extra layer of protection to your credit report. Placing a fraud alert is highly recommended if you have been a victim of identity theft.
- Identity and credit monitoring services scan your credit reports for you and alert you when a change occurs.
Additional efforts to enhance education of older adults include the CFPB’s free identity theft placemat and other tools available on their website, to help encourage discussions about identity theft and financial abuse with older adults. Banks should consider how these tools might be useful in educating their customers on protecting their sensitive information and identifying fraudulent activity.
ADVISORY AND RECOMMENDATIONS FOR FINANCIAL INSITUTIONS:
In 2016, the CFPB provided six categories of voluntary best practices to help financial institutions prevent, and intervene in, elder financial abuse. These categories are still relevant today and include:
- Developing and implementing internal protocols and procedures for protecting account holders from elder financial exploitation;
- Training management and staff to prevent, detect, and respond to suspicious events;
- Detecting elder financial exploitation by harnessing technology;
- Reporting all cases of suspected exploitation to relevant federal, state and local authorities;
- Protecting older account holders by complying with the Electronic Fund Transfer Act (EFTA) and Regulation E and by offering age-friendly services that can enhance protections against financial exploitation;
- Collaborating with other stakeholders such as law enforcement, adult protective services, and service organizations.
The 2019 Advisory and Recommendations reiterates these key recommendations and provides new information on reporting based on federal and state legislative changes.
Compliance Resource will be offering a two-hour webinar on Elder Financial Exploitation presented by Susan Costonis on November 14, 2019. More information will be available soon. Please watch the training page of our website for details on the program and registration.