A bill to require the reporting of any suspected financial exploitation of our kupuna and vulnerable adults in relation to securities was signed by David Ige today during a ceremony at the Washington Place.
HB 940 HD2 SD1 mandates reporting of suspected financial exploitation of elders and vulnerable adults in relation to securities, provides immunity for good faith reporting, and authorizes the delay of disbursements and transactions in situations of suspected financial exploitation.
“As our kupuna grow older, they can become susceptible to abuse that take advantage of their lack of understanding for sophisticated financial transactions. This can put their hard-earned life savings at risk,” said Representative Troy Hashimoto, co-convener of the House Kupuna Caucus. “This bill provides a mechanism for this type exploitation to be reported and stopped if necessary.”
In passing the bill, the Senate Judiciary Committee found that the financial exploitation of elders is the fastest growing form of elder abuse and can result in devastating consequences for victims, including fear, loss of independence, reduced quality of life, and even death. This measure is based on a securities model act from 2016 that has since been enacted in more than two-dozen states across the country and addresses existing privacy rules and concerns about potential legal exposure and liability that may make it difficult for securities professionals to contact regulators and other government authorities to report suspected financial exploitation.
This measure enables financial institutions and the State to work together in preventing, identifying, and addressing cases of financial abuse to combat this growing threat to Hawaiʻi’s elders and vulnerable adults.
“Given our large aging population in Hawaii, and more so than other parts of the country we have a very trusting aging population, we need to make sure they are protected. It is not like they are uninformed, but with difficult areas of law like securities where experts opinions can differ, it is really important to have some kind of framework to protect our vulnerable adults and seniors. The large majority of financial advisors are great individuals, but we are always on the lookout for behaviors that raise red flags,” said Representative Dale T. Kobayashi (Manoa, Punahou, University, Moʻiliʻili), who spoke at the Washington Place ceremony today.
Securities are fungible and tradable financial instruments used to raise capital in public and private markets. Stocks and bonds are the most common examples of securities, but can also include financial futures, options, and hedge fund investments.
According to testimony from the state Department of Commerce and Consumer Affairs, this bill expands the State’s securities law, Hawaii Revised Statutes Chapter 485A, to require a qualified person to report any reasonable belief of financial exploitation of an elder or a vulnerable adult to the Commissioner of Securities. This measure will allow the Department to better protect Hawaiʻi’s elders and vulnerable adults from financial exploitation, and it is especially critical during this time as financial exploitation of the elderly and vulnerable adults has steadily increased during the COVID-19 pandemic.
To report this type of elder abuse, call the State Department of Commerce and Consumer Affairs, Commissioner of Securities Ty Nohara at 586-2850.
