George P. Kazen Federal Building and United States Courthouse

Floor Speech

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Mr. President, at the end of a Congress, we all know how easy it is for just one Senator to block a bill. I rise today to express my great disappointment that we have been unable to overcome objections from just one Senator from the other side of the aisle who is blocking the passage of legislation called the Senior Safe Act that is designed to help protect our seniors from financial fraud and exploitation. This is a bill I introduced with my colleague, Senator Claire McCaskill, as a result of extensive hearings and investigations that we have conducted in the Senate Aging Committee. A companion bill passed the House on a voice vote.

Nationally, as many as 5 million seniors may be victims of financial abuse annually. Stopping this tsunami of fraud has been one of the top priorities of the Senate Aging Committee. In the many hearings we have held on this issue, what we found is that scammers seek to gain the trust and active cooperation of their victims, who are usually older Americans. Without that trust and cooperation, their schemes would fail. Unfortunately, seniors often do not see the red flags that signal that fraud is likely involved in these sophisticated schemes. Sometimes seniors are simply too nice, too trusting. In other sad cases, they may suffer from diminished capacity.

But just as often, they miss these flags because the swindlers who prey upon them are extremely crafty and they know how to sound convincing. Any of us who have received these calls at home know how persuasive and persistent these con artists can be. Whatever the reason, a warning sign that can slip by a victim might trigger a second look by a financial services representative who is trained to spot common scams and who knows enough about a senior's habits to question a transaction that just doesn't look right. In our work on the Senate Aging Committee, we have heard of so many cases where an alert bank teller or credit union employee on the frontlines has stopped a financial fraud in its tracks, saving seniors untold thousands of dollars. In fact, the Government Accountability Office estimates that our seniors lose an astonishing $2.9 billion a year to this kind of fraud, and that is probably the tip of the iceberg because many times this fraud is never reported.

I will give an example. Earlier this year, an attorney in the small coastal city of Belfast, ME, was sentenced to 30 months in prison for bilking two older female clients out of nearly half a million dollars over the course of several years. The lawyer's brazen theft was uncovered when a local bank teller noticed that he was writing large checks to himself from his clients' accounts. When confronted by authorities, he offered excuses that the prosecutor later described as ``breathtaking.'' For example, he put one of his clients into a nursing home to recover from a temporary medical condition and then managed to keep her there for 4 years until the theft of her funds came to light.

In the meantime, he submitted bills for services, sometimes totaling $20,000 a month, including charging her $250 per hour for 6 to 7 hours to check on her house, which was a 1-minute drive from his office.
Financial institutions are in a critical position to check these fraudsters. If properly trained, employees can be the first line of defense. Regrettably, certain laws can inadvertently impede efforts to protect seniors because financial institutions that report suspected fraud can be exposed to lawsuits. Our bill, the Senior$afe Act, encourages financial institutions to train their employees and shields them from lawsuits for making good-faith, reasonable reports of potential fraud to the proper authorities.

As Jaye Martin, the head of Maine Legal Services for the Elderly, put it in a letter describing her support for the Collins-McCaskill bill, ``In a landscape that includes family members who often wish to keep exploitation from coming to light because they are perpetrating the exploitation, the risk of facing potential nuisance or false complaints over privacy violations is all too real.'' This is a barrier that must be removed so that financial institutions will act immediately to make a report to the proper authorities upon forming a reasonable belief that exploitation is occurring. These professionals are on the frontlines in the fight against elder financial exploitation and are often the only ones in a position to stop the exploitation before it is too late.

Mr. President, I ask unanimous consent to have printed in the Record the full letter from Ms. Martin immediately following my remarks. Our bipartisan bill is based on the State of Maine's innovative Senior Safe Program. It has been a collaborative effort by my State's regulators, financial institutions, and legal organizations to educate bank and credit union employees on how to identify and help stop the exploitation of older Mainers. It was pioneered by Maine's securities administrator, Judith Shaw, and it has led to a significant increase in reports of suspected senior financial exploitation and fraud.

The Maine program also serves as a template for model legislation developed for adoption by the North American Securities Administrators Administration, which is known as NASAA. The Senior Safe Act and this model State legislation are complementary efforts, and I am very pleased that the association of securities administrators has endorsed our bill.

As I mentioned, the House Financial Services Committee approved our companion bill by a vote of 59 to 0 in June, and it passed the House by a voice vote in July. The Senate bill is sponsored by a quarter of the Members of this body, balanced nearly evenly on both sides of the aisle, and has the support of a wide range of stakeholders looking out for the interests of consumers, including the securities administrators whom I have already mentioned, the Conference of State Bank Supervisors, and the National Association of Insurance Commissioners.

These are all regulators who are looking out for our consumers. Mr. President, I ask unanimous consent to have printed in the Record these letters of endorsement immediately following my remarks.

Under our bill, liability protections are only provided for good- faith, reasonable reports of suspected fraud.
The legal obstacles facing financial institutions that report this kind of suspected fraud and abuse are not limited to just privacy laws because these institutions have also been threatened with claims such as breach of contract, bad faith, slander, unfair practices, and even harassment. As one compliance officer for one of my community banks put it, without this kind of immunity for good-faith reporting, small community banks will face the ``freeze effect'' and won't make reports that could help to protect our seniors; thus, ``the effectiveness of Senior Safe will be undercut.''

I just cannot believe we cannot clear this commonsense bill for the President's signature when it would help so many seniors avoid becoming the victims of financial fraud and abuse, when it is supported by groups like Maine Legal Services for the Elderly, when it has won the support of national organizations of State securities administrators, State insurance commissioners, State bank regulators, when it would make such a difference.
Sadly, because of the objections of just one Senator on the other side of the aisle, we are stymied. That means we will have to start all over again next year. Much needed help for our seniors--that could help them avoid being swindled out of what GAO estimates is almost $3 billion a year--will have to wait for another day. I just don't understand it.

I have made many good-faith efforts in this regard, but regretfully, because we are at the end of the session, we don't have the time to go through all of the procedural steps that would be needed to pass this bill, which I am sure, given its broad bipartisan support, would pass overwhelmingly. I hope the Senator in question will reconsider and allow us to send this important bill to the President for his signature. There being no objection, the material was ordered to be printed in the Record, as follows:

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