Financial advisors need a lot of support in their efforts to help vulnerable customers, says Merrill Lynch‘s supervisor.
“One of the things I observe and think about in our industry is if you’re an advisor and if you’re really troubled by a client’s potentially diminished capacity, or a member’s goals family, or a third party with undue influence over a senior client’s business, we as an industry need to continue to provide support so advisors know where to go,” Susan AxelrodMerrill’s chief oversight officer, told the Securities and Capital Markets Industry AssociationPrivate client conference.
An advisor is a trusted and valued member of a person’s inner circle, according to Axelrod, who served as executive vice president of regulatory operations at the Financial Sector Regulatory Authoritywhere she worked for 28 years before moving to Merrill.
“So you see a lot – sometimes maybe more than a doctor, more than a child who doesn’t live nearby,” she said. “But what do you do when you start to worry?”
Axelrod described visiting an office in the Midwest where a staff member described a disturbing scenario to him.
“I said, ‘OK, this is really bad’ and, immediately, I kind of knew what to do, but if I hadn’t been in the office at the time, would this advisor and this team would have the resources to deal with this?” she says. “Would they have made it worse?”
Merrill has worked to ensure its advisers have the support they need to deal with difficult situations, according to Axelrod.
“It’s a very tough space,” she said. “We must be relentless in our quest to help make things right for all of these customers.”
Wirehouse efforts include setting up a senior council that brings in guest speakers to discuss, for example, current scams targeting vulnerable customers, according to Axelrod. Merrill employees involved in senior council events are ambassadors for these issues within the company, she added.
“In addition, the investigation team on people at risk of Bank of AmericaI know, Merrill and private bank investigators report to our organization, so we’re able to speed things up,” Axelrod said.
“And we’re constantly trying to make sure that our advisers, if they don’t know what to do, it’s hard to know what to do in each of these situations, they have somewhere to go – that support is essential,” she added. .
More power to fight against exploitation
In February, Finra amended Rule 2165, titled “Financial Exploitation of Specified Adults,” to give financial firms more power to suspend suspicious transactions, and make such suspensions almost twice as long. Examples of exploitation cited by the self-regulator include a $10,000 lottery scam, a $60,000 romance scam, and a $200,000 scam Central Intelligence Agency trial scam.
The previous rule allowed companies to suspend the disbursement of funds or securities, and the amendment now allows them to suspend securities transactions as well. The amendment also extended the temporary suspension of disbursements as well as transactions from 25 business days to 55 business days in cases where the company reports the matter to state regulators or agencies or to a court.
In a related development, Wells Fargo froze the talk show host’s accounts wendy williams after advising Lori Schiller said Williams was unable to manage his finances, according to an emergency injunction Williams filed in New York state court in February, seeking to regain control of his accounts, as indicated.
Wells Fargo told Asbury Park Press it froze the accounts because it suspected Williams was a victim of financial abuse. The company also defended Schiller, saying she had an unblemished record over her 23-year career, according to the publication.
“Wells Fargo’s priority is the financial well-being of Ms. Williams and the preservation of her privacy,” the company told the publication in a statement. “As we told the Court, Wells Fargo is willing to work with Ms. Williams’ attorney to release funds directly to her creditors for historically and regularly paid bills from her accounts.”
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