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Minutes for HB2562 - Committee on Financial Institutions and Insurance
Short Title
Enacting the protect vulnerable adults from financial exploitation act.
Minutes Content for Wed, Mar 6, 2024
Chairperson Longbine opened the meeting, greeting members, and welcoming conferees and guests. It was noted that Tamera Lawrence, Sr. Assistant Revisor, Revisor of Statutes Office (ROS) attended the meeting virtually via Webex. He recognized Senator Brenda Dietrich, who introduced Blake Marauth, Prescott Tuffley, John Gregory, and Jake Jijo, who were acting as Senate Pages today.
The Chairperson turned the Committee's attention to today's agenda, and opened the hearing on HB2562.
Eileen Ma, Assistant Revisor, Revisor of Statutes Office, ROS, presented the Revisor's Memorandum brief. She answered questions posed by Senators Fagg and Warren regarding the definition of "Eligible adult" in the bill. (Attachment 1)
Eric Turek, Director, Government and Public Affairs, Kansas Insurance Department (KID), Dan Klukas, Kansas Securities Commissioner, and Clay Johnson, Assistant General Counsel, KID, presented testimony in support of HB2562, which Mr. Turek requested on behalf of KID. Mr. Turek told members that this bill was conceived as a new law to protect the elderly and vulnerable adults from financial exploitation. It was based upon model legislation that has been adopted in some form by 41 other states. He told members that the bill had also been filed last year, but needed more work, and has been brought forward this year with the suggested changes of staff and stakeholders. (Attachment 2)
Chrisy Khatib, Director, Adult Protective Services, Kansas Department for Children and Families (DCF), appeared and testified in support of the bill. Ms. Khatib related that the financial exploitation harm is more significant than financial losses. It results in emotional, physical, and social harm to involved adults, who may experience a loss of autonomy and control in their lives after being a victim of financial exploitation. After the abuse occurs, they may experience more stress or anxiety about financial decisions, along with withdrawal from family and friends, exacerbated health conditions, and an impaired sense of trust. (Attachment 3)
Leslie Anderson, Executive Director, Kansas Association of Area Agencies on Aging and Disabilities (k4ad), presented proponent testimony. She related that this generation of older adults is unique from prior generations in that they live longer, spend a significant part of their lifetime in the workforce, retire later in life, and control an average of 70% of the invested wealth in the United States. As they begin to retire and draw from their savings and investments, they also become more likely to be subject to financial exploitation and scams. (Attachment 4)
Travis Grauerholz, on behalf of National Association of Insurance and Financial Advisors (NAIFA) spoke in support of HB2562. He testified that if enacted, this bill would allow investment advisors and firms the tools to protect their elderly clients by placing a temporary hold on a suspect transaction and notify KID and DCF Adult Protective Services (APS) within 48 hours if they reasonably believe continuing the the transaction would lead to further financial exploitation. KID and APS would then conduct an investigation and determine what actions should be taken. (Attachment 5)
Glenda DuBoise, State Director, AARP Kansas, presented proponent testimony. She said that older Americans are attractive targets for fraud because they often have sizable assets built through a lifetime of hard work. Although older people make up about 12% of the population, they constitute 30% of the victims of consumer fraud crime. Women, who are increasingly a larger percentage of the older population because of a longer life expectancy, are the majority of the victims. (Attachment 6)
Chairperson Longbine opened the floor for questions to the proponents from Senators Warren, Gossage, and Fagg. He then pointed members' attention to the proponent written-only testimony from:
Andrew Guggenheim, Managing Director & Associate General Counsel, State Government Affairs, Securities Industry and Financial Markets Association (SIFMA) (Attachment 7)
David Wolf, General Counsel, AE Wealth Management LLC; AE Financial Services LLC; and Advisors Excel, Topeka, Kansas (Attachment 8)
Joseph Peiffer, President, Public Investors Advocate Bar Association (Attachment 9)
There being no further questions or discussion and no other proponent, opponent, or neutral testimony submitted, Chairperson Longbine closed the hearing on HB2562.
