Seven regulators issued guidance on Tuesday to clarify that the Gramm-Leach-Bliley Act’s privacy provisions generally allow financial institutions to report suspected elder financial abuse to authorities.
Under the law, financial institutions are required to give consumers an opportunity to opt out before providing nonpublic personal information to a third party.
The guidance, issued by the Federal Reserve, CFPB, FDIC, FTC, National Credit Union Administration, OCC and SEC, clarifies that banks and other financial institutions have the ability to contact local, state or federal agencies if elder financial abuse is suspected.
The elderly are often targets for financial exploitation by scammers, financial advisors, caregivers and family members. A study by MetLife noted a national study of older adults, which found that the one-year prevalence for financial abuse by a family member was five percent.
The MetLife study showed that elderly women were twice as likely as men to be victims of financial abuse, and dollar losses over the holidays were higher than any other category. Men were also more likely to be the perpetrators of elder financial abuse, and average losses to victims were the highest for Medicare- and Medicaid-related fraud.
The CFPB said that staff at financial institutions may have the ability to spot irregular transactions, account activity or other behavior that indicates financial abuse, playing a key role in preventing and detecting elder financial exploitation.