Recently, Florida passed a new law that will go into effect on January 1, 2025 that will help protect people over 60 years of age and vulnerable adults from losing money to scams.  According to the FBI, People over the age of 60 lost more than 3.4 billion dollars to scams last year and the figure is probably higher as many seniors do not report being scammed out of embarrassment.  Scammers often prefer payments from funds wired from their victims’ bank accounts because these payments are anonymous and generally not able to be reversed.  The new Florida law will allow banks to delay payments if the bank employees have reason to believe that the senior or other vulnerable adult is being scammed.  In that event, the law requires the bank to also notify a “trusted contact” who is a person, generally a close family member or friend that the senior designates to be consulted in situations such as this.  While not universal, many banks around the country provide for designating a trusted contact.  In addition, FINRA, the regulatory organization for brokers and financial advisors has long had a regulation requiring financial advisors to ask their clients to designate a trusted contact when opening an account.

Laws like this are an important weapon against scammers.  Scammers, who have a knowledge of psychology that Freud would have envied are aware that scaring people with phony emergencies triggers the amygdala which is a part of the brain also called the lizard brain which makes us act quickly and emotionally without rationally considering the situation.  A bank employee or trusted contact is in a better position to react rationally to prospective scams than targeted victims who are blinded by their emotions and their lizard brain.

TIPS

The Florida law is only the most recent law of this kind. Texas, New York, Arizona, Virginia, Washington and Ohio also have similar laws.  If your state does not have such a law, you may want to talk to your legislators to encourage them to pass a similar law.  Even if your state does not have such a law, many banks on their own offer the option of having a “trusted contact” to bank accounts.  This is always a good idea and you should ask at your bank to see if you can do so.

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