Report on Vulnerable Investors

In addition, a regulatory legal safe harbor should be extended to the firm and their representatives for placing a temporary hold on disbursements or trades from the account of a vulnerable client, provided the firm and its representatives act in accordance with the regulatory requirements (which are discussed in this report) including the applicable provisions of a regulator-approved conduct prot [...] The numbers are increasing because of the compounding factors of the demographic aging of the Baby Boomer generation, increased life expectancy (with an average well into the 80s for both men and women) and the inter-generational transfer of wealth. [...] They rely on their representative to select the best investment for them and most believe the representative will recommend what is best for the client even at the expense of their own commission.”26 The relationship between representatives and investors, regardless of age, is a spectrum ranging from unconditional confidence and trust, to dealing with the registrant as a mere order taker. [...] Advisors are the main source of investment information and most blindingly trust the advice they are given.”28 Added to this is the significant asymmetry in knowledge and expertise between the representative and the client. [...] The representative must keep a record of the client’s answers and in general must annually update the KYC profile or update the information if there is a material change in a client’s circumstances (loss of a job, marriage, divorce, death of a spouse, birth of a child, etc).