Senate
Study
Bill
1131
-
Introduced
SENATE/HOUSE
FILE
_____
BY
(PROPOSED
DEPARTMENT
OF
COMMERCE/INSURANCE
DIVISION
BILL)
A
BILL
FOR
An
Act
relating
to
the
financial
exploitation
of
designated
1
eligible
adults,
and
making
an
appropriation.
2
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
3
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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.
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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.
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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
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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.
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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
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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
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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
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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
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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.
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