New State Law Protects Senior Investors From Deceptive Advisors who use Bogus "Senior Advisor " Titles
NEWARK – The New Jersey Bureau of Securities (Bureau) is reminding New Jersey’s senior citizens about a new law prohibiting the use of misleading "senior" or "retirement" professional designations in connection with securities brokerage and investment advisory activities. On July 6, 2010, Governor Christie signed legislation making New Jersey among 31 states that now offer this protection for seniors.
The law prohibits the use of senior-specialization designations by any person who lacks certification from an accrediting organization.
"This is an important tool in protecting senior citizens in New Jersey," said Attorney General Paula T. Dow. "Predatory practices against our seniors will be vigorously pursued by my office."
The law is based on the model adopted in March 2008 by the North American Securities Administrators Association (NASAA), of which New Jersey is a member state. NASAA developed the model rule after organizing a multi-state effort to focus attention on unscrupulous behavior targeting senior investors by implying self-conferred expertise.
"Unfortunately, securities regulators in New Jersey and elsewhere continue to encounter advisers who sell unsuitable high risk or bogus financial products by luring senior citizens through the use of misleading professional designations such as ‘Certified Elder Planning Specialist,’" said Thomas R. Calcagni, Acting Director of New Jersey’s Division of Consumer Affairs. "This law makes clear that using a phony senior-specific designation that falsely implies some financial expertise in the investment needs of our elderly investors is against the law in New Jersey."
"Using this law, we will be better positioned to protect New Jersey’s senior citizens from being misled into purchasing investment products that are unsuitable for them, based on their investment goals and needs, " said Marc B. Minor, Chief of the New Jersey Bureau of Securities. "That means heading off marketing tricks and gimmicks with a law prohibiting the use of illusive titles that can be used to lull elderly investors into a false sense of security."
While any investor can be misled by the use of false titles, this law specifically protects senior citizens from misleading certifications and designations aimed at taking advantage of them. Seniors continue to be the number one target for securities fraud. Approximately 20 percent of all Americans over the age of 65 – over 7.5 million seniors – have fallen victim to financial fraud.
Investors of all ages are strongly encouraged to research advisers before investing. The public can obtain free background information on investment professionals, including their employment and disciplinary history, by contacting the Bureau of Securities and requesting a copy of a Central Registration Depository "CRD" report.
If you have encountered an adviser claiming to have questionable "senior specialist" designations, or if you have other concerns or complaints, you are encouraged to contact the Bureau of Securities. Please contact the Bureau at www.askbureauofsecurities.gov or call toll-free 1-866-I-Invest. Complaint forms can also be found on the Bureau’s website at www.njsecurities.gov .