By Jay Fishman, J.D.
SEC Chairman Christopher Cox, FINRA Chief Executive Officer Mary Schapiro and NASAA Present Karen Tyler signed onto an initiative to protect senior investors from fraud. The initiative is not an exam, sweep or survey but rather a voluntary opportunity for financial services firms to dialogue with the SEC, FINRA and NASAA about the effectiveness of the firms' current practices to serve seniors in the following areas: marketing and advertising; account opening; product and account review; ongoing review of the appropriateness of products; meeting the changing needs of customers as they age; surveillance and compliance reviews; and training for firm employees.
The input received by the SEC, NASAA and FINRA will not lead to new regulatory requirements but to helping firms better serve their senior investors. This effort is but one part of an overall national initiative to protect seniors from investment fraud and sales of unsuitable securities that was announced by SEC Chairman Cox, FINRA and NASAA in May, 2006. The initiative's components include targeted examinations, enforcement of securities laws in cases of fraud against seniors and investor education and outreach.