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Wagner’s Financial Exploitation Prevention Act Passes House, Heads to Senate

January 30, 2023

Washington, D.C.  – Congresswoman Ann Wagner (R-MO), Chair of the Financial Services subcommittee on Capital Markets, released the following statement after her Financial Exploitation Prevention Act passed the U.S. House:

The Financial Exploitation Prevention Act will provide our vulnerable investors with an important layer of protection to help make sure that they receive the hard-earned savings that they have built up over the years.  Financial exploitation of seniors is elder abuse and, tragically, about twenty percent of senior investors fall prey to financial fraud, losing an estimated $2.9 billion annually.  I hope the Senate takes up this bill immediately so vulnerable investors have the protections they deserve.”

Background
The Financial Exploitation Prevention Act would give the financial industry better tools to address suspected financial exploitation and abuse of seniors and those with mental and physical disabilities. First, the bill requires the Securities and Exchange Commission to report to Congress on recommendations for legislative and regulatory changes on how to combat financial exploitation of seniors and vulnerable adults. Second, the bill permits a registered open-end investment company or transfer agent for that company, including mutual funds, to better protect seniors by delaying the redemption period of any redeemable security if it was reasonably believed that such redemption was requested through the financial exploitation of a security holder who is a senior or an individual unable to protect their own interests.

Over the next 10+ years, 10,000 Americans will turn 65 every day, with seniors making up 18% of the nation’s population by 2030. As more investors age into retirement, their risk of exploitation increases. Currently, about 1 in 5 senior investors are victimized by financial fraud, and those investors lose an estimated $2.9 billion annually in reported cases.