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David N. Kirkman
Task Force Alert
Chair
Asst Attorney General
Consumer Protection
NC Department of
Justice
P.O. Box 629
Raleigh, NC 27602
919-716-6000

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North Carolina Division of Aging and Adult Services

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TO NC SENIOR CONSUMER FRAUD TASK FORCE MEMBERS

******Alert #315******

State Legislators, Federal Regulators Clarify Banks' Abilities and Duties to Report Suspected Elder Fraud

In recent days and weeks, North Carolina and federal officials have clarified the duties and abilities of bank personnel when they detect signs that an elderly customer is the victim of financial exploitation. As many Task Force members know, banks and their employees are well positioned to spot such crimes, but often they feel that state and federal bank privacy laws prevent them from reporting the incidents to any government agency besides county adult protective services.

On July 23rd the Governor signed into law Senate Bill 140, which several members of this Task Force worked on for well over a year. The legislation makes it clear that banks should also report scams in progress to appropriate law enforcement agencies, such as local police or sheriffs when the older bank customer is being victimized by home repair, driveway paving or other face-to-face scammers, or the Attorney General when the customer is being scammed over the phone or via the internet by parties in other states or overseas. The ability of these officials to respond immediately and interrupt the transactions often is crucial to preventing immediate and substantial financial loss as well as future losses. The legislation gives banks and their employees immunity from civil suits if they report such incidents in good faith. It also encourages banks to train their employees on detecting and properly reporting suspected financial exploitation of older customers. In addition, it simplifies the requirements that prosecutors must meet in order to obtain convictions for financial exploitation of a senior. A copy of SB 140 is available on-line at http://www.ncga.state.nc.us/Sessions/2013/Bills/Senate/PDF/S140v8.pdf

Yesterday, several federal agencies made it clear to the financial institutions that they regulate that the Gramm-Leach-Bliley Act does not prohibit them from reporting such incidents to appropriate state and local law enforcement authorities. More information on that announcement can be found at http://www.consumerfinance.gov/newsroom/director-cordray-remarks-at-the-gramm-leach-bliley-press-call/

******End of Alert******

Date: September 25, 2013

David N. Kirkman
Task Force Alerts Chair
Assistant Attorney General
Consumer Protection Division
Office of Attorney General Roy Cooper
114 West Edenton Street
9001 Mail Processing Center
Raleigh, NC 27699-9001
Tel. 919-716-6000

 

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NC Senior Consumer
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