DENVER — Governor Hickenlooper signed into law House Bill 17-1253, known as the “Protection of Vulnerable Adults from Financial Exploitation Act.”

The act creates a mandatory reporting requirement for all licensed investment adviser and broker-dealer firms and their employees where there is a reasonable suspicion or belief that financial exploitation may be occurring. It will be included in the Colorado Securities Act and enforced by the Division of Securities, part of the Colorado Department of Regulatory Agencies (DORA).

Sponsored by Rep. Jessie Danielson and Sen. Larry Crowder, the act provides a pathway for confidential reporting and information sharing to law enforcement and adult protective services by investment firms and professionals who suspect that financial abuses of at-risk clients, such as senior citizens, may be taking place.

Other protections include giving financial firms the ability to delay a disbursement of funds to a person whom they believe may be the victim of a financial scam or fraud. The act also grants immunity from civil and administrative liability to those professionals who report in good faith.

“Protection of our community’s vulnerable populations, of which seniors are a quickly growing subset, must be a joint effort,” commented DORA Executive Director Joe Neguse. “Financial professionals are in a unique position to spot red flags of potential abuses, and this bill will assist our Department in identifying and combatting financial fraud against seniors.”

“Over half of the investigations conducted by the Division of Securities involve senior victims who are not only at greater risk of exploitation, but also tend to suffer more detrimental issues like negative health and mental effects following a financial crime,” stated Securities Commissioner Gerald Rome. “The intent of this bill is to create a better partnership with our financial professional licensees to collaboratively tackle the issue.”

The Division of Securities drafted the bill, and in order to support firms who will now be mandatory reporters is offering a free, hour-long training, “Senior$afe,” for employees to train them on suspicious activities and the red flags of financial crimes.

The new act takes effect on July 1.