I received two very similar telephone calls this week from baby boomers who were worried that their elderly parents may have been the victim of stockbroker fraud by major Wall Street brokerage firms. Both of them had just learned of the issue.
Ordinarily, we would analyze the brokerage statements and the facts and decide whether the seniors had viable claims. However, there was a problem. The potential stockbroker fraud activity occurred as early as 1999. The children did not know about the issues because the elderly parents never shared their financial information with their grown children.
Huge mistake. There are various statutes of limitations or eligibility rules which can bar investors from bringing claims against brokerage firms. In these two matters, the seniors may have had potential claims but we decided not to take either case because the facts took place many, many years ago.
How does one protect their senior citizen parents from stock broker fraud? Have consistent, open discussions with your parents regarding their investments. And most importantly, ask that you be copied on the monthly statements for all of their accounts. Even if you don’t have control over the investments, at least you can keep on eye on them. Had either child reviewed statements in the stories I told above, the fraud would have likely been uncovered in a timely manner and the seniors would have been able to redress the wrongdoing appropriately.