An investor helpline for seniors established by the Financial Industry Regulatory Authority earlier this year has become a fertile ground for spotting frauds and other issues faced by older investors.
Since its launch in April, the Finra Securities Helpline for Seniors (1-844-574-3577) has received 2,545 calls and Finra staff have helped obtain nearly $750,000 in reimbursements for clients, Finra said in a year-end report released Wednesday.
Additionally, calls to the helpline have been the impetus for a number of Finra investor alerts.
Over the first two months of the helpline’s operation, Finra said it received more than 20 calls about transfer-on death accounts, resulting in an investor alert about the accounts.
Investor calls about scams involving lottery winnings, tax bills and binary options also led to Finra alerts.
Moreover, the helpline resulted in a number of enforcement actions. For example, Finra barred a broker after discovering an undisclosed client loan, and uncovered another broker using his influence to be named the primary beneficiary of an elderly client’s $3 million estate.
The report said Finra made 75 referrals to other federal and state authorities as a result of helpline calls, and 50 more referrals to state adult protective services.
The call service, staffed with dedicated Finra personnel, is designed to provide a quick response to any type of investor concern.
As an example, Finra says its staff made an in-person visit to a 99-year-old caller whose account had been abandoned and helped arrange for a new broker to take over.
“Since launching the Helpline, we have received a number of calls from investors—including long-time clients of firms—concerned about their firm or registered representative dropping them as a client,” the report says. “Terminating a client relationship can raise difficult issues for both the client and the firm, and Finra urges firms to address these situations thoughtfully.”
Helpline staffers helped another investor recover money from a trading error, and found the account of another elderly investor who hadn’t realized her assets were held at a clearing firm after her B-D had gone out of business.
The report urges broker-dealers to obtain the name and contact information for a trusted person the firm can contact on behalf of elderly clients, as well as prohibit registered representatives from serving as a power of attorney or trustee for clients.