2019 -- S 0433

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LC001340

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2019

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A N   A C T

RELATING TO CORPORATIONS, ASSOCIATIONS, AND PARTNERSHIPS -- SENIOR

SAVINGS PROTECTION ACT

     

     Introduced By: Senators Lawson, Nesselbush, Valverde, Murray, and Euer

     Date Introduced: February 27, 2019

     Referred To: Senate Finance

     It is enacted by the General Assembly as follows:

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     SECTION 1. Title 7 of the General Laws entitled "CORPORATIONS,

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ASSOCIATIONS, AND PARTNERSHIPS" is hereby amended by adding thereto the following

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chapter:

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CHAPTER 11.2

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SENIOR SAVINGS PROTECTION ACT

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     7-11.2-1. Short title - Rules of construction.

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     (a) This chapter shall be known as and may be cited as the "Senior Savings Protection

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Act".

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     (b) This chapter shall be liberally construed and applied to promote its underlying

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purposes and policy and to make uniform the laws with respect to the subject of this chapter

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among states enacting it.

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     (c) Unless displaced by the particular provisions of this chapter, the principles of law and

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equity supplement its provisions.

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     7-11.2-2. Definitions.

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     As used in this chapter, the following words and phrases shall have the following

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meanings unless the context otherwise requires:

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     (1) "Agencies" means the department of human services - division of elderly affairs, and

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the department of business regulation.

 

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     (2) "Agent" means an individual, other than a broker-dealer, who represents a broker-

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dealer in effecting or attempting to effect purchases or sales of securities or represents an issuer in

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effecting or attempting to effect purchases or sales of the issuer's securities; provided, that a

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partner, officer, or director of a broker-dealer or issuer, or an individual having a similar status or

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performing similar functions is an agent only if the individual otherwise comes within the term.

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The term does not include an individual excluded by rule adopted or order issued under this

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chapter.

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     (3) "Broker-dealer" means a person engaged in the business of effecting transactions in

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securities for the account of others or for the person's own account. The term does not include:

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     (i) An agent;

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     (ii) An issuer;

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     (iii) A bank, a trust company organized or chartered under the laws of this state, or a

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savings institution, if its activities as a broker-dealer are limited to those specified in the

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Securities Exchange Act of 1934, as amended (15 U.S.C. Section 78a, et seq.) or a bank that

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satisfies the conditions described in the Securities Exchange Act of 1934, as amended (15 U.S.C.

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Sections 78a et seq.);

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     (iv) An international banking institution; or

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     (v) A person excluded by rule adopted or order issued under this chapter.

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     (4) "Financial exploitation" means the wrongful or unauthorized taking, withholding,

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appropriation, or use of money, real property, or personal property of a qualified adult.

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     (5) "Immediate family member" means a spouse, child, parent, or sibling of a qualified

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adult;

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     (6) "Qualified adult" means:

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     (i) A person sixty (60) years of age or older; or

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     (ii) A person who:

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     (A) Has a mental or physical impairment that substantially limits one or more major life

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activities, whether the impairment is congenital or acquired by accident, injury or disease, where

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such impairment is verified by medical findings; and

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     (B) Is between the ages of eighteen (18) and fifty-nine (59);

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     (7) "Qualified individual" means a person associated with a broker-dealer who serves in a

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supervisory, compliance, or legal capacity as part of their job.

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     7-11.2-3. Notification of agencies and family members.

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     If a qualified individual reasonably believes that financial exploitation of a qualified adult

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has occurred, has been attempted, or is being attempted, the qualified individual may notify the

 

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agencies. Subsequent to notifying the agencies, an agent or qualified individual may notify an

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immediate family member, legal guardian, conservator, cotrustee, successor trustee, or agent

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under a power of attorney of the qualified adult of such belief.

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     7-11.2-4. Refusal of request for disbursement.

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     (a) A qualified individual may refuse a request for disbursement from the account of a

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qualified adult, or an account on which a qualified adult is a beneficiary or beneficial owner, if:

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     (1) The qualified individual reasonably believes that the requested disbursement will

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result in financial exploitation of the qualified adult; and

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     (2) The broker-dealer or qualified individual:

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     (i) Within two (2) business days makes a reasonable effort to notify all parties authorized

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to transact business on the account orally or in writing, unless such parties are reasonably

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believed to have engaged in suspected or attempted financial exploitation of the qualified adult;

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and

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     (ii) Within three (3) business days notifies the agencies.

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     (b) Any refusal of a disbursement as authorized by this section shall expire upon the

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sooner of:

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     (1) The time when the broker-dealer or qualified individual reasonably believes that the

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disbursement will not result in financial exploitation of the qualified adult; or

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     (2) Ten (10) business days after the initial refusal of disbursement by the qualified

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individual.

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     (c) A court of competent jurisdiction may enter an order extending the refusal of a

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disbursement or any other protective relief.

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     7-11.2-5. Immunity from liability.

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     Notwithstanding any other provision of law to the contrary, a broker-dealer, agent, or

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qualified individual who, in good faith and exercising reasonable care, complies with the

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provisions of this chapter shall be immune from any civil liability under this chapter.

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     7-11.2-6. Website for training resources to prevent and detect financial exploitation.

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     No later than July 1, 2020, the agencies shall develop and make available websites that

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include training resources to assist broker-dealers and agents in the prevention and detection of

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financial exploitation of qualified adults. Such resources shall include, at a minimum, indicators

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of financial exploitation of qualified adults and potential steps broker-dealers and agents may take

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to prevent suspected financial exploitation of qualified adults as authorized by law.

 

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     SECTION 2. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO CORPORATIONS, ASSOCIATIONS, AND PARTNERSHIPS -- SENIOR

SAVINGS PROTECTION ACT

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     This act would establish the Senior Savings Protection Act to permit certain individuals

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to report the occurrence or suspected occurrence of financial exploitation of qualified adults,

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which are persons sixty (60) years of age or older or who have a disability and are between the

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ages of eighteen (18) and fifty-nine (59).

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     This act would take effect upon passage.

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