S.F. _____ H.F. _____ Section 1. Section 502.607, subsection 2, Code 2021, is 1 amended by adding the following new paragraph: 2 NEW PARAGRAPH . g. A record obtained by the administrator or 3 by law enforcement under section 502.809. 4 Sec. 2. Section 502.607, subsection 3, Code 2021, is amended 5 to read as follows: 6 3. Administrator discretion to disclose. If disclosure 7 is for the purpose of a civil, administrative, or criminal 8 investigation, action, or proceeding or to a person specified 9 in section 502.608, subsection 1 , the administrator may 10 disclose a record obtained in connection with an audit or 11 inspection under section 502.411, subsection 4 , or a record 12 obtained in connection with an investigation under section 13 502.602 or section 502.809 . 14 Sec. 3. NEW SECTION . 502.801 Definitions. 15 For purposes of this article, unless the context otherwise 16 requires: 17 1. “Eligible adult” means any of the following: 18 a. A person sixty-five years of age or older. 19 b. A dependent adult as defined in section 235B.2. 20 2. “Financial exploitation” means any act or omission taken 21 by a person to wrongfully and knowingly deprive an eligible 22 adult of money, assets, or property, or to obtain control over 23 or otherwise use, convert, or divert the benefits, property, 24 resources, or assets of the eligible adult by intimidation, 25 deception, coercion, fraud, extortion, or undue influence. 26 3. “Permissible third party” means any of the following: 27 a. A person the eligible adult previously designated to 28 receive the notification described in section 502.804. 29 b. A person otherwise permitted to receive the notification 30 described in section 502.804 by any state or federal law or any 31 rule issued by the financial industry regulatory authority. 32 4. “Qualified individual” means any of the following: 33 a. An agent who has received training pursuant to section 34 502.808. 35 -1- LSB 1331XD (3) 89 jda/rn 1/ 9

S.F. _____ H.F. _____ b. An investment adviser representative who has received 1 training pursuant to section 502.808. 2 c. A person who has received training pursuant to 3 section 502.808 and who serves in a supervisory, compliance, 4 senior investor protection, or legal capacity for any of the 5 following: 6 (1) A broker-dealer. 7 (2) An investment adviser. 8 Sec. 4. NEW SECTION . 502.802 Notification to administrator. 9 If a broker-dealer, investment adviser, or qualified 10 individual reasonably believes financial exploitation of 11 an eligible adult has occurred, has been attempted, or is 12 being attempted, the broker-dealer, investment adviser, or 13 qualified individual may promptly notify the administrator. 14 The administrator may adopt rules regarding the form and manner 15 of the notification under this section. 16 Sec. 5. NEW SECTION . 502.803 Notification to administrator 17 —— immunity. 18 A broker-dealer, investment adviser, or qualified individual 19 who, acting reasonably and in good faith, makes a disclosure 20 of information to the administrator pursuant to this article 21 shall be immune from administrative or civil liability that 22 might otherwise arise from such disclosure or for any failure 23 to notify the eligible adult of the disclosure. This section 24 shall not abrogate or modify any existing statutory or common 25 law privileges or immunities. 26 Sec. 6. NEW SECTION . 502.804 Notification to permissible 27 third party. 28 1. If a broker-dealer, investment adviser, or qualified 29 individual reasonably believes financial exploitation of 30 an eligible adult has occurred, has been attempted, or is 31 being attempted, the broker-dealer, investment adviser, or 32 qualified individual may notify a permissible third party. The 33 administrator may adopt rules regarding the form and manner of 34 the notification under this section. 35 -2- LSB 1331XD (3) 89 jda/rn 2/ 9

S.F. _____ H.F. _____ 2. Broker-dealers, investment advisers, and qualified 1 individuals shall not notify a permissible third party the 2 broker-dealer, investment adviser, or qualified individual 3 reasonably suspects of financial exploitation or other abuse 4 of the eligible adult. 5 Sec. 7. NEW SECTION . 502.805 Notification to permissible 6 third party —— immunity. 7 A broker-dealer, investment adviser, or qualified individual 8 who, acting reasonably and in good faith, complies with section 9 502.804 shall be immune from any administrative or civil 10 liability that might otherwise arise from such disclosure. 11 Sec. 8. NEW SECTION . 502.806 Disbursements or transactions 12 —— delay. 13 1. If a broker-dealer, investment adviser, or qualified 14 individual reasonably believes a disbursement or transaction 15 will likely result in or contribute to the financial 16 exploitation of an eligible adult, the broker-dealer, 17 investment adviser, or qualified individual shall initiate an 18 internal review of the requested disbursement or transaction. 19 2. A broker-dealer or investment adviser may delay a 20 disbursement or transaction from an eligible adult’s account or 21 an account on which an eligible adult is a beneficiary if all 22 of the following apply: 23 a. The broker-dealer, investment adviser, or qualified 24 individual reasonably believes, after initiating the internal 25 review referenced in subsection 1, that the requested 26 disbursement or transaction will likely result in or contribute 27 to the financial exploitation of an eligible adult. 28 b. Immediately, but in no event more than two business 29 days after the disbursement or transaction is delayed, 30 the broker-dealer or investment adviser provides written 31 notification of the delay and the reason for the delay to 32 all persons authorized to transact business on the account. 33 Broker-dealers, investment advisers, and qualified individuals 34 shall not notify a person authorized to transact business 35 -3- LSB 1331XD (3) 89 jda/rn 3/ 9

S.F. _____ H.F. _____ on the account if the broker-dealer, investment adviser, 1 or qualified individual reasonably believes the person 2 has committed financial exploitation, attempted financial 3 exploitation, or other abuse of the eligible adult. 4 c. Immediately, but in no event more than two business 5 days after the disbursement or transaction is delayed, the 6 broker-dealer or investment adviser notifies the administrator 7 of the delay and provides to the administrator the reason 8 for the delay, including the results of the internal review 9 referenced in subsection 1. 10 d. The broker-dealer or investment adviser continues 11 the internal review of the suspected or attempted financial 12 exploitation of the eligible adult, as necessary, and provides 13 the administrator with updates upon request. 14 3. Any delay of a disbursement or transaction authorized by 15 this section will expire upon the first to occur of any of the 16 following: 17 a. A determination by the broker-dealer or investment 18 adviser that the disbursement or transaction will not result in 19 or contribute to financial exploitation of the eligible adult. 20 b. Fifteen business days after the date on which the 21 broker-dealer or investment adviser first delayed disbursement 22 of the funds or transaction, unless the administrator requests 23 the broker-dealer or investment adviser to extend the delay, 24 in which case the delay shall expire no more than twenty-five 25 business days after the date on which the broker-dealer or 26 investment adviser first delayed the disbursement of the funds 27 or the transaction. 28 4. Notwithstanding subsection 3, upon the petition of 29 the administrator, the broker-dealer or investment adviser 30 who initiated the delay pursuant to this section, or another 31 interested party, a court of competent jurisdiction may enter 32 an order terminating, extending, or modifying the delay of the 33 disbursement or transaction and may order other protective 34 relief. 35 -4- LSB 1331XD (3) 89 jda/rn 4/ 9

S.F. _____ H.F. _____ 5. The administrator may adopt rules regarding the form and 1 manner of the notifications under this section. 2 Sec. 9. NEW SECTION . 502.807 Disbursements of transactions 3 —— delay —— immunity. 4 A broker-dealer or investment adviser who, acting reasonably 5 and in good faith, complies with section 502.806 shall be 6 immune from any administrative or civil liability that 7 might otherwise arise from such delay in a disbursement or 8 transaction. 9 Sec. 10. NEW SECTION . 502.808 Training requirements. 10 1. A broker-dealer or investment adviser shall provide 11 to its qualified individuals training appropriate to the job 12 responsibilities of a qualified individual. The training shall 13 include all of the following: 14 a. Instruction on how to identify the suspected or attempted 15 exploitation of an eligible adult, including common signs 16 indicating the financial exploitation of an eligible adult, 17 and how to provide notification regarding the suspected or 18 attempted exploitation of an eligible adult. 19 b. Instruction regarding privacy and confidentiality 20 requirements. 21 2. A broker-dealer or investment adviser shall provide 22 the training required by this section as soon as reasonably 23 practicable, but at least within one year after the date 24 the qualified individual begins employment with or becomes 25 affiliated or associated with a broker-dealer or investment 26 adviser. 27 3. The administrator may adopt rules specifying the content 28 and method of the training required by this section. 29 Sec. 11. NEW SECTION . 502.809 Records. 30 A broker-dealer or investment adviser shall provide access 31 to or copies of records that are relevant to the suspected 32 or attempted financial exploitation of an eligible adult to 33 the administrator, either as part of a notification to the 34 administrator pursuant to section 502.802, or upon the request 35 -5- LSB 1331XD (3) 89 jda/rn 5/ 9

S.F. _____ H.F. _____ of the administrator. The records may include historical 1 records as well as records relating to the most recent 2 transactions that may comprise financial exploitation of an 3 eligible adult. The administrator may share the records with 4 law enforcement if the administrator determines it is necessary 5 or appropriate in the public interest and for the protection 6 of the eligible adult. All records made available to the 7 administrator or law enforcement pursuant to this section 8 shall be considered confidential public records under chapter 9 22 and shall not be available for examination by the public 10 pursuant to section 22.2. Nothing in this section shall limit 11 or otherwise impede the authority of the administrator or law 12 enforcement to access or examine the books and records of 13 broker-dealers and investment advisers as otherwise provided 14 by law. 15 Sec. 12. NEW SECTION . 502.810 Financial exploitation —— 16 appropriation. 17 1. For the fiscal year beginning July 1, 2021, and each 18 fiscal year thereafter, there is appropriated from the 19 department of commerce revolving fund created in section 546.12 20 to the insurance division seventy-five thousand dollars for 21 the sole and exclusive purpose of investigating complaints 22 and notifications related to financial exploitation of 23 eligible adults. The insurance division shall use the funds 24 appropriated under this subsection for one full-time equivalent 25 position. 26 2. Notwithstanding section 8.33, moneys appropriated in 27 this section that remain unencumbered or unobligated at the 28 close of the fiscal year shall not revert but shall remain 29 available for expenditure for the purposes designated until the 30 close of the succeeding fiscal year. 31 Sec. 13. NEW SECTION . 502.811 Financial exploitation —— 32 reporting. 33 Annually, on or before January 15 of each year, the insurance 34 division shall submit a report to the governor and the general 35 -6- LSB 1331XD (3) 89 jda/rn 6/ 9

S.F. _____ H.F. _____ assembly concerning the notifications the insurance division 1 received related to the potential financial exploitation of 2 eligible adults, and the insurance division’s investigation 3 of the notifications, during the preceding calendar year. 4 The report shall include the number of notifications the 5 insurance division received, the amount of time employees of 6 the insurance division spent investigating the notifications, 7 and the number of incidents of founded financial exploitation 8 of eligible adults. 9 EXPLANATION 10 The inclusion of this explanation does not constitute agreement with 11 the explanation’s substance by the members of the general assembly. 12 This bill relates to the financial exploitation of persons 13 designated as eligible adults. The bill defines an eligible 14 adult as persons 65 years of age or older and certain dependent 15 adults as defined in Code section 235B.2. 16 The bill authorizes broker-dealers, investment advisers, 17 and qualified individuals to notify the commissioner of 18 insurance if they reasonably believe financial exploitation 19 of an eligible adult has occurred, has been attempted, 20 or is being attempted. The bill provides immunity for 21 broker-dealers, investment advisers, and qualified individuals 22 from administrative or civil liability incurred or imposed as 23 a result of this notification or as a result of any failure to 24 alert the eligible adult of the notification. 25 The bill allows broker-dealers, investment advisers, and 26 qualified individuals to notify permissible third parties 27 if they reasonably believe financial exploitation of an 28 eligible adult has occurred, has been attempted, or is 29 being attempted. The bill similarly provides immunity for 30 broker-dealers, investment advisers, and qualified individuals 31 from administrative or civil liability incurred or imposed as 32 a result of this notification. 33 The bill prohibits broker-dealers, investment advisers, 34 and qualified individuals from notifying a permissible third 35 -7- LSB 1331XD (3) 89 jda/rn 7/ 9

S.F. _____ H.F. _____ party if the broker-dealer, investment adviser, or qualified 1 individual reasonably suspects the permissible third party of 2 financial exploitation or other abuse of the eligible adult. 3 The bill requires a broker-dealer, investment adviser, 4 or qualified individual to initiate an internal review of a 5 requested disbursement or transaction if the broker-dealer, 6 investment adviser, or qualified individual reasonably believes 7 the disbursement or transaction will likely result in or 8 contribute to the financial exploitation of an eligible adult. 9 The bill allows a broker-dealer or investment adviser 10 to delay a disbursement or transaction from an eligible 11 adult’s account or an account on which an eligible adult is 12 a beneficiary if certain enumerated steps are followed. The 13 bill also prohibits broker-dealers, investment advisers, and 14 qualified individuals from notifying a person authorized 15 to transact business on the eligible adult’s account or an 16 account on which an eligible adult is a beneficiary if the 17 broker-dealer, investment adviser, or qualified individual 18 reasonably believes the person has committed financial 19 exploitation or other abuse of the eligible adult. 20 The bill establishes when and under what conditions the 21 delay of the disbursement or transaction is to end. The bill 22 provides immunity for broker-dealers and investment advisers 23 from administrative or civil liability incurred or imposed as 24 a result of the delay. 25 The bill requires broker-dealers or investment advisers 26 to provide to qualified individuals training related to 27 identifying financial exploitation of eligible adults and 28 privacy and confidentiality requirements. 29 The bill also requires broker-dealers and investment 30 advisers to provide the commissioner of insurance access to 31 and copies of records relevant to investigations of financial 32 exploitation of eligible adults in certain enumerated 33 circumstances. The bill authorizes the commissioner to 34 share the records with law enforcement when the administrator 35 -8- LSB 1331XD (3) 89 jda/rn 8/ 9

S.F. _____ H.F. _____ determines it is necessary or appropriate in the public 1 interest and for the protection of the eligible adult. The 2 bill provides these records are considered confidential records 3 for purposes of Code chapter 22, and are not available for 4 examination under Code section 22.2. 5 The bill requires the insurance division of the department 6 of commerce to submit an annual report to the governor and the 7 general assembly that includes the number of notifications 8 the insurance division received related to the potential 9 financial exploitation of eligible adults, the amount of time 10 employees of the insurance division spent investigating the 11 notifications, and the number of incidents of founded financial 12 exploitation of eligible adults, during the preceding calendar 13 year. 14 The bill makes an appropriation from the commerce revolving 15 fund created in Code section 546.12 to the insurance division 16 of the department of commerce for the fiscal year beginning 17 July 1, 2021, and each year thereafter, for purposes of 18 investigating complaints and notifications related to financial 19 exploitation of eligible adults. 20 -9- LSB 1331XD (3) 89 jda/rn 9/ 9