In 2010, Congress passed The Elder Justice Act as part of the Patient Protection and Affordable Care Act.
It is an ambitious piece of legislation, which includes authorizing a grant program for adult protective services and various other programs and social services designed to assist states in protecting the aged and infirm. Unfortunately, as of October 2013, no money has been appropriated to implement the Act, according to the National Adult Protective Services Association (a non-profit organization devoted to strengthening adult protective services programs).
Federal law permits reporting of elder financial exploitation by banks, notwithstanding privacy considerations. Under 31 C.F.R. §103.18 (reports by banks of suspicious transactions), banks are not explicitly required to report elder financial exploitation, but banks are required to report a transaction made through the bank that involves $5,000 or more if the bank knows, suspects or has reason to suspect that the “transaction has no business or apparently lawful purpose or is not the sort in which the particular customer would normally be expected to engage, and the bank knows of no reasonable explanation for the transaction after examining the available facts, including the background and possible purpose of the transaction.” 31 C.F.R. § 103.18(a)(2)(iii). That arguably could encompass a transaction that involved elder financial exploitation (if it was for $5,000 or more), and FinCEN states in its advisory to banks regarding the reporting of elder financial exploitation that banks “should” report such a transaction on a Suspicious Activity Report (SAR). Advisory to Financial Institutions on Filing Suspicious Activity Reports Regarding Elder Financial Exploitation, FIN-2011-A003, Feb. 22, 2011.
FinCEN is the Department of the Treasury’s Financial Crimes Enforcement Network. FinCEN and other federal agencies have sent out an advisory and guidance to banks encouraging them to report elder financial exploitation. Other federal agencies’ guidance explains that banks do not need to worry about the Gramm-Leach-Bliley privacy law because reporting elder financial exploitation is expressly permitted under it. Interagency Guidance on Privacy Laws and Reporting Financial Abuse of Older Adults. FinCEN specifically requests that banks include the term “elder financial exploitation” in the narrative portion of the SAR, but warns that this term and all information about the victim should not be reported as the subject of the SAR. Id.
The other federal agencies that published a joint “Interagency Guidance on Privacy laws and Reporting Financial Abuse of Older Adults” explaining that Gramm-Leach-Bliley poses no obstacle to reporting elder financial exploitation include the Board of Governors of the Federal Reserve System, Commodities Futures Trading Commission (CFTC), Consumer Financial Protection Bureau (CFPB), Federal Deposit Insurance Corporation (FDIC), Federal Trade Commission (FTC), National Credit Union Administration (NCUA), Office of the Comptroller of the Currency (OCC), and the Securities and Exchange Commission (SEC). Id.
Of course, this is all at the federal level. FinCEN emphasizes that banks should continue to report all forms of elder abuse according to institutional policies and the requirements of state and local laws and regulations, where applicable.
According to the National Adult Protective Services Association (NAPSA), every states has statutes that create an adult protective services program. As of July 2013, 49 states and the District of Columbia impose mandatory reporting of cases of suspected elder abuse, neglect and/or exploitation upon certain persons. Those statutes may also impose criminal penalties if the reporting requirements are not met, in addition to criminal penalties for abuse, neglect and exploitation of elders. Most states do not expressly provide for private rights of action.
Georgia, for example, requires certain persons who have reasonable cause to believe that a disabled adult or elder person has been abused, neglected or exploited to cause certain reports to be made. Those persons generally include any administrator, manager, or employee of a long-term care facility
Employees of financial institutions and any physician, osteopath, intern, resident, other hospital or medical personnel, dentist, psychologist, chiropractor, podiatrist, pharmacist, physical therapist, occupational therapist, licensed professional counselor, nurse, social worker, day-care worker, coroner, medical examiner, or other health professional.
Notably, when such a person is a staff member of a facility, such as a financial institution or hospital, he or she must notify the person in charge of the facility, and the person in charge files (or causes to be filed) the required reports.
Georgia law requires an immediate report by telephone or in person to the Georgia Department of Human Services and to the appropriate law enforcement agency or prosecutor, followed by a written report within 24 hours containing the information specified in the statute.
Usually, the report must be made even if the reasonable cause is based upon a privileged communication.
Georgia’s neighboring states have statutes with similar provisions. Alabama’s reporting requirement is limited to physicians and other practitioners of the healing arts, and it does not include financial institutions or their employees. Virginia defines reporters to include most persons who are licensed, certified, or registered by a health regulatory board; employees or contractors who work with or provide care for adults; and guardians, conservators, and law enforcement officers, but it does not require reporting by financial institutions or their staff.
West Virginia limits reporters to medical, dental, or mental health professionals; Christian Science practitioners and religious healers; social workers; law enforcement and “humane” officers; state or regional ombudsmen; and any employee of any nursing home or residential facility, but it does not require financial institutions to report cases of elder abuse.
Other southeastern states – Florida, Kentucky, Mississippi, North Carolina, South Carolina, and Tennessee – make “any person” a potential reporting person, including (without limitation) financial institutions, long-term care facilities, and nursing homes.