Financial Exploitation of Specified Adults

What this video covers

• Who qualifies as a specified adult: senior investors (age 65 or older) and impaired adults (age 18 or older whom the firm reasonably believes has a mental or physical impairment)
• Why the firm needs only a reasonable belief based on observed facts, not medical certainty, to classify a customer as an impaired adult
• The scope of a temporary hold: both disbursements and securities transactions, limited to the specific transaction under suspicion rather than the entire account
• The maximum hold timeline: 15 business days initially, then 10 additional business days with internal review support, then up to 30 more once reported to state authorities (55 business days total)
• Why the internal review must start immediately but notification to trusted contacts and authorized parties is due within 2 business days, not immediately
• Who actually has authority to place, extend, or terminate a hold under written supervisory procedures: a person acting in a supervisory, compliance, or legal capacity
• What safe harbor does: shields the firm from FINRA's general standards, improper-use, and account-transfer rules when the hold is exercised consistently with the rule
• Why a trusted contact person has zero trading authority and cannot cancel transactions, and why the firm can still open or maintain an account if the customer refuses to name one