Bill H.4462

FILED ON: 1/31/2022

HOUSE . . . . . . . . . . . . . . . No. 4462

The Commonwealth of Massachusetts

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In the One Hundred and Ninety-Second General Court
(2021-2022)

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An Act protecting vulnerable adults from financial exploitation.

Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority of the same, as follows:

The General Laws are hereby amended by inserting after chapter 110H the following chapter:-
Chapter 110I.
FINANCIAL EXPLOITATION
Section 1. The following words, whenever used in this chapter shall, unless a different meaning
clearly appears from the context, have the following meanings:-
“Agencies”, (1) the secretary of the commonwealth and (2) the disabled persons protection
commission established pursuant to section 2 of chapter 19C, if the eligible adult is under the age
of 60, or the executive office of elder affairs, if the eligible adult is 60 years or older.
“Agent”, as defined in section 401 of chapter 110A.
“Broker-dealer”, as defined in section 401 of chapter 110A.
“Eligible adult”, a person 60 years of age or older or a disabled person, as defined in section 1 of
chapter 19C.
“Financial exploitation”, (2) the wrongful or unauthorized taking, withholding, appropriation, or
use of money, assets or property of an eligible adult; or (2) any act or omission taken by a
person, including through the use of a power of attorney, guardianship, or conservatorship of an
eligible adult, to: (a) obtain control, through deception, intimidation or undue influence, over the
eligible adult’s money, assets or property to deprive the eligible adult of the ownership, use,
benefit or possession of his or her money, assets or property; or (b) convert money, assets or
property of the eligible adult to deprive such eligible adult of the ownership, use, benefit or
possession of his or her money, assets or property.
“Investment adviser”, as defined in section 401 of chapter 110A.
“Investment adviser representative”, as defined in section 401 of chapter 110A.
“Qualified individual”, any agent, investment adviser representative or person who serves in a
supervisory, compliance or legal capacity for a broker-dealer or investment adviser, or who
works in an investor protection capacity for a broker-dealer or investment adviser.
Section 2. If a qualified individual reasonably believes that financial exploitation of an eligible
adult may have occurred, may have been attempted, or is being attempted, the qualified
individual may promptly notify: (1) the secretary of the commonwealth and (2) the disabled
persons protection commission established pursuant to section 2 of chapter 19C, if the eligible
adult is under the age of 60, or the executive office of elder affairs, if the eligible adult is 60
years or older. Following notification from a qualified individual pursuant to this section, the
agency shall respond to reasonable inquiries from the qualified individual as to the status of any
investigation by the agency, and upon conclusion of any investigation, the agency shall issue a
statement of findings to the qualified individual.
Section 3. A qualified individual that in good faith and exercising reasonable care makes a
disclosure of information pursuant to section 2 shall be immune from administrative or civil
liability that might otherwise arise from such disclosure or for any failure to notify the customer
of the disclosure.
Section 4. If a qualified individual reasonably believes that financial exploitation of an eligible
adult may have occurred, may have been attempted, or is being attempted, a qualified individual
may notify any third party previously designated by the eligible adult, any third party reasonably
associated with the eligible adult, or any third party permitted under state or federal law.
Disclosure shall not be made to any designated third party that is suspected of financial
exploitation or other abuse of the eligible adult.
Section 5. A qualified individual that, in good faith and exercising reasonable care, complies
with section 4 shall be immune from any administrative or civil liability that might otherwise
arise from such disclosure.
Section 6. (1) A broker-dealer or investment adviser may delay a transaction or a disbursement
from an account of an eligible adult or an account on which an eligible adult is a beneficiary if:
(a) the broker-dealer, investment adviser or qualified individual reasonably believes, after
initiating an internal review of the requested transaction or disbursement and the suspected
financial exploitation, that the requested transaction or disbursement may result in financial
exploitation of an eligible adult; and (b) the broker-dealer or investment adviser: (i) immediately,
but in no event more than 2 business days after the qualified individual first delayed the
transaction or disbursement, provides written notification of the delay and the reason for the
delay to all parties authorized to transact business on the account, unless any such party is
reasonably believed to have engaged in suspected or attempted financial exploitation of the
eligible adult; (ii) immediately, but in no event more than 2 business days after the requested
transaction or disbursement, notifies the agencies; and (iii) provides status updates to the
Secretary of the Commonwealth, the Executive Office of Elder Affairs, and the Disabled Persons
protection Commission upon request.
(2) Any delay of a transaction or disbursement as authorized by this section will expire upon the
sooner of: (a) a determination by the broker-dealer or investment adviser that the transaction or
disbursement will not result in financial exploitation of the eligible adult; or (b) 15 business days
after the date on which the broker-dealer or investment adviser first delayed a transaction or a
disbursement of the funds, unless either of the agencies requests that the broker-dealer or
investment adviser extend the delay, in which case the delay shall expire no more than 25
business days after the date on which the broker-dealer or investment adviser first delayed a
transaction or a disbursement of the funds unless otherwise terminated or further extended by
either of the agencies or an order of a court of competent jurisdiction.
(3) A court of competent jurisdiction may enter an order extending the delay of the transaction or
disbursement of funds or may order other protective relief based on the petition of: (1) the
secretary of the commonwealth, (2) the disabled persons protection commission established
pursuant to section 2 of chapter 19C, if the eligible adult is under the age of 60, or the executive
office of elder affairs, if the eligible adult is 60 years or older, (3) the broker-dealer or investment
adviser that initiated the delay pursuant to this section or (4) another interested party.
Section 7. A broker-dealer or investment adviser that, in good faith and exercising reasonable
care, complies with section 6 shall be immune from any administrative or civil liability that
might otherwise arise from such delay in a transaction or a disbursement.
Section 8. A broker-dealer or investment adviser shall provide access to or copies of records that
are relevant to the suspected or attempted financial exploitation of an eligible adult to the
disabled persons protection commission established pursuant to section 2 of chapter 19C, if the
eligible adult is under the age of 60, or the executive office of elder affairs, if the eligible adult is
60 years or older and law enforcement, either as part of a referral to the agency or to law
enforcement, or upon request of the agency or law enforcement pursuant to an investigation. The
records may include historical records as well as records relating to the most recent transaction
or transactions that may comprise financial exploitation of an eligible adult. All records made
available to agencies pursuant to this section shall not be considered a public record as defined in
section 7 of chapter 4 or chapter 66. Nothing in this section shall limit or otherwise impede the
authority of the state secretary to access or examine the books and records of broker-dealers and
investment advisers as otherwise provided by law.
Section 9. A qualified individual that, in good faith and exercising reasonable care, complies
with section 8 shall be immune from any administrative or civil liability that might otherwise
arise from such compliance.