diminished capacity Tag Archives — New York Securities Fraud Lawyers Blog

How Can Securities Lawyers Be Better Prepared To Work With Diminished Capacity and Assess Financial Capacity?

January 21, 2016 | Malecki Law Team

According to FINRA’s estimates, for the next 15 years, an average of 10,000 Americans will turn 65. Those of us who work with the elderly regularly, need to be attuned to deciding whether our clients have the capacity to make decisions regarding their financial affairs? All lawyers, be it in the practice area of estates, securities, or virtually any other discipline often have to make a capacity determination, while contracting services and sometimes along the way. We often have to determine if our client has the capacity to have entered into certain legal transactions.

According to the American Bar Association, Rule 1.14 that provides guidance on Client With Diminished Capacity (ABA):

(b) When the lawyer reasonably believes that the client has diminished capacity, is at risk of substantial physical, financial or other harm unless action is taken and cannot adequately act in the client’s own interest, the lawyer may take reasonably necessary protective action, including consulting with individuals or entities that have the ability to take action to protect the client and, in appropriate cases, seeking the appointment of a guardian ad litem, conservator or guardian.

How Financial Advisors Can Better Protect Elderly Investors

January 11, 2016 | Malecki Law Team

According to FINRA’s estimates, the elderly lose approximately $ 2.9 billion every year due to fraud. To protect vulnerable elderly investors from financial abuse, FINRA had approved a rule in 2015 that enables investment firms to put temporary holds on fund disbursement and securities transactions, and notify a designated trusted contact if they have reasonable belief of financial exploitation.

Every day for the next 15 years, an average of 10,000 Americans will turn 65 (FINRA 2015). This initiative was an addition to several other FINRA initiatives to protect seniors, which includes the establishment of a toll-free hotline in April 2015. FINRA’s proposal is a step toward empowering advisors to act and prevent elder fraud. But how do advisors distinguish between valid and fraudulent transactions? After all, their intervention can risk delaying critical transactions and disbursement of funds, resulting in financial losses or, worse, delaying payments related to health care or housing.

IDENTIFYING SUSPICIOUS ACTIVITY

Jenice L. Malecki Moderated A Panel Today at PIABA

October 23, 2015 | Malecki Law Team

Ms. Jenice Malecki was a moderator today at Public Investors Arbitration Bar Association’s (PIABA) panel on ‘The Danger of Diminished Capacity, Ethics as a Broker and for the Lawyer.’ The seminar discussed what diminished capacity is, important studies on dealing with clients with diminished capacity as financial advisors and lawyers, and elder financial abuse and privacy law issues. The panel moderated by Ms. Malecki consisted of distinguished members of the financial and legal community including the President of the Investor Trust Protection, a former SEC attorney and an elder lawyer.

According to FINRA’s estimates, the elderly lose approximately $ 2.9 billion every year due to fraud and an average of 10,000 Americans will turn 65 over the next 15 years. Senior investors with diminished capacity are more at risk of falling victim to financial fraud than other investors and the financial industry should fully utilize its power to prevent substantial economic harm to elderly clients. Ms. Malecki has also co-authored an article for PIABA titled Protecting Clients with Diminished Capacity In The Securities Industry: It’s Tricky.

This panel is part of PIABA’s 24^th Annual Meeting held in Florida from Oct 21- 23, 2015.