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OSCO Reports on Helping Senior Investors Avoid Investment Fraud and Risks

01 March 2018

The International Organization of Securities Commissions (IOSCO) has published the report, Senior Investment Vulnerability (Report), examining growing concerns regulators have about the risks to ageing investors to financial fraud and other risks and identifies sound practices for enhancing their protection.

The Report shows that seniors are at a higher risk than other investors of losing money to fraud, and regulators face challenges with respect to protecting this investor population. The biggest risks are unsuitable investments and financial fraud, particularly relating to complex products. These vulnerabilities are growing just as many investors assume greater responsibility for their own retirement and financial future.

The Report discusses IOSCO members’ views and experiences regarding senior investor vulnerability and recommends sound practices for both regulators and financial services providers and includes a non-exhaustive bibliography of literature that may be helpful to regulators and others.

Sound practices suggested for regulators include:

  • Deliver educational programs and resources targeting senior investors
  • Foster development of senior-focused expertise within existing regulatory, educational or advisory programs
  • Conduct research projects to better understand the risks and issues facing senior investors and the incidence and mechanics of investment fraud that affect seniors in their jurisdictions
  • Develop guidelines and training programs for personnel reviewing transactions conducted with senior investors.

Sound practices suggested for financial service providers include: (a) offering support to senior investors experiencing a life event during the product lifecycle; and (b) providing training and support for employees of financial services firms.

The report is available here.

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