Eureka Reporter

By CAROL HARRISON, The Eureka Reporter

Published: Feb 21 2008, 11:06 PM

State Assemblywoman Patty Berg (D-1st) introduced a pair of bills Thursday that seek to stop the financial abuse and swindling of older adults by unscrupulous salespeople using bogus titles to gain their confidence.

Assembly Bills 2149 and 2150 would regulate the use of words or phrases that suggest special expertise in the finances of the elderly.

Under these bills, insurance agents and financial planners would be prohibited from claiming to be a “Senior Financial Expert,” “Certified Senior Financial Planner” or similar title without undergoing state-recognized training on the subject.

“They use these titles to gain seniors’ trust,” said Berg stated in a media release from her office. “We want to make sure those titles actually mean something.”

The goal: to prevent seniors from losing their life savings to sweet-sounding pitches by so-called experts.

A Feb. 1 letter to Berg from the Social Services Branch of the Humboldt County Department of Health and Human Services reported financial abuse of seniors and dependent adults is on the rise.

In 2007, the letter stated, 27 percent of the assigned reports — about 234 — in Adult Protective Services involved financial abuse — an increase of 39 percent in four years.

The agency received 1,400 reports in 2007, with roughly 870 meeting the criteria for assignment.

Berg believes nothing says “trust me” to an older person like the words “Certified Senior Advisor” written in gold letters on a business card.

But, too often, that trust is not deserved, she said.

“Too often, older people are convinced to buy long-term investment instruments such as annuities that are ill-suited to their needs, but which pay lucrative commissions to the sales agents,” the media release stated. “And all too often the people who sell these products have little or no legitimate training in managing the finances of older adults.”

Berg said elder financial abuse is one of the fastest-growing segments of crime. Nearly a quarter-million older Californians fall prey to some sort of swindle or abuse each year.

A recent New York Times investigation found that the number of “certified” senior experts in the sales force has increased 78 percent in the last five years. Some of these agents are legitimate experts, but Berg believes many either obtain their “credentials” through dubious means or invent a title themselves.

“There are a lot of good people out there doing business with seniors,” said Berg, who chairs the Assembly Committee on Aging and Long-Term Care. “This regulation will help the good actors as much as it will hinder the bad ones.”

The Commissioner of Corporations will maintain the list of accredited organizations and authorize specific use of the title or description.

The Legislative Counsel’s Digest reported those who use an unapproved credential or professional designation are not guilty of a crime and not subject to specified penalties.

Berg spokesperson Will Shuck does not think the absence of penalties should be the focus.

“Stealing money is already against the law,” he said. “We want to provide is a tool for both the honest agent and those with less-than-honest motives. When you are introducing yourself to clients, if you are going to say you are expert in areas dealing with financial expertise in all things senior, you should have had to prove it to the commissioner.”

Shuck said the bill gives the commissioners of insurance and corporations leeway to set up the titles and certify the training to satisfy the definition.

“We’re giving them one more tool to regulate the licenses,” he said. “With any licensing, if you are not compliant with the program and that sort of thing, then they can take your license away.”

While catching those who prey on the elderly is still a challenge, Shuck hopes setting up a system that verifies the training gives customers some recourse to check, much as they do now with contractors or physicians.

“What we’re trying to do is not to criminalize the use of the words, but to establish regulations similar to what have already been set in Massachusetts. Anecdotally, we hear from them the approach is working.”

The bills are sponsored by the California Alliance for Retired Americans and the Congress of California Seniors. The Gray Panthers of California and the Older Women’s League are also in support.