Financial exploitation of elders is a serious problem in America. Reports find that elderly Americans lose as much as $3 billion each year to financial scams and abuse. One near-victim of a financial scam was the late-grandmother of Rep. Josh Gottheimer (D-NJ), who was tricked into giving her bank account information to a scammer posing as an IRS agent. Fortunately, her son was able to put a hold on her bank account in time and no money was lost.
The incident led the congressman to introduce the Senior Security Act (H.R. 1876). The bill would set up a Senior Investor Task Force at the Securities and Exchange Commission (SEC) to “identify challenges that senior investors encounter, including problems associated with financial exploitation and cognitive decline and identifying regulatory changes that could help senior investors.” The taskforce would coordinate with other agencies and release a biannual report summarizing recent trends, initiatives, and needed improvements to prevent elder financial abuse.
Not only did Rep. Gottheimer introduce the legislation, he successfully got it passed through the House of Representatives last week by a landslide vote of 392-20. Just Senate passage and a president’s signature away from becoming law.
Seeing a problem. Writing legislation to fix it. Getting it passed. That is what being a congressman is all about!
Well actually, it’s about getting headlines by passing legislation with your name on it. Fixing the problem…falls further down the list.
See, Rep. Gottheimer is not the first Congressmen to pinpoint financial abuse of elders as a problem. In fact, the first legislation dealing with the interests of elders came with the Older Americans Act of 1965 which established the Administration on Aging (AoA). The AoA established the Prevention of Elder Abuse, Neglect and Exploitation program in 1987, which was codified by Congress in 1992. That program runs five different elder abuse initiatives out of its office.
But that is hardly the only federal initiative dealing with elder abuse and financial exploitation. Eight different federal agencies have activities that relate to elder abuse prevention. Let’s just run through a sampling:
- HHS’s Administration for Community Living runs The National Center for Elder Abuse
- DOJ runs the Elder Justice Initiative which includes data collection, educational resources, and a senior scam alert
- CFPB produces educational materials and data analysis on Elder Financial Exploitation.
- FDIC runs an educational and awareness program called Money Smart for Older Adults
- The FTC published a 41-page “Protecting Older Consumers” report outlining their efforts to combat elder abuse
- FINRA runs a Securities Helpline for Seniors
- The FBI runs a Fraud Against Seniors tip page
Even the Securities Exchange Commission (SEC), the agency where the new task force under the bill would be established, already has an entire webpage dedicated to seniors. Not only that, the SEC is already taking actions to address financial exploitation of seniors, including approving the first uniform, national standards to protect senior investors last year. They also provided guidance last year to the financial industry that they are allowed to delay disbursements of funds if fraud is suspected.
Also last year, the SEC released a comprehensive report called “Elder Financial Exploitation: Why it is a concern, what regulators are doing about it, and looking ahead.” This report includes tons of data and examples, along with a proposal to develop a communication network that would serve as an early warning system within the financial services industry. The SEC also published an educational guide called “A Guide for Seniors: Protect yourself against investment fraud.”
Okay, so there’s clearly a ton of existing federal resources within and outside of the SEC. But wouldn’t the task force envisioned by the Senior Securities Act play a key coordinating role amongst all these various federal agencies and initiatives?
That already exists too.
Congress passed the Elder Justice Act in 2010. In addition to authorizing funding for elder abuse programs, it created the Elder Justice Coordinating Council (EJCC). The council is “designed to coordinate activities across the federal government related to elder abuse, neglect and exploitation.”
The council convenes representatives from the eight federal agencies that work on elder abuse issues twice a year. The EJCC even issues a biannual report to Congress – just like the one called for in the Senior Security Act of 2019. The SEC actually sits on the coordinating council!
Yet, the House just overwhelmingly passed a bill that would spend $7 million setting up a new task force on elder abuse at the SEC.
If Congress believes that all the programs, initiatives, data collection efforts, educational disbursement, and coordinating council already on the books are not working well enough, then shouldn’t we just fix those?
In Congress, it’s way easier to create something new than to fix something old.
And that is the story of how we ended up with 15 federal programs on financial literacy, 160 federal housing assistance programs, 94 green building programs, 253 crime prevention programs, 14 diesel emission reduction programs, 45 early learning and child care programs, 209 STEM programs, and so much more rampant duplication across the federal government.
Hopefully the Senate will do their due diligence, stop this new duplicative initiative, and get to work improving what’s already on the books.
