FPA of California Legislative Alert: Senate Bill 496

Hello FPA Member!

We know you get a lot of email, but this is a very local issue and requires a local and timely response.

CA SB496 Is now at the Appropriations Committee, in the state Assembly, just a few steps away from becoming law. It is California’s version of the spate of “Vulnerable Adults” bills that have proliferated around the country in the last few years, but it differs from many of the other final bills in two very important respects.

Vulnerable Adults bills will typically create categories of “mandated reporters” who are required to report suspected instances of financial abuse of an older person to authorities in their respective states. There are ranges of fines and civil penalties that may be applied if signs of abuse are ignored, and the language that has most frequently been used in final versions of these bills indicates that the reporter “may” make such a report – leaving a degree of discretion to the financial professional on the spot. These situations can be highly ambiguous, and no two are exactly alike. A mistaken report, however well-intentioned, would quite possibly change a client relationship forever. FPA has been successful in adjusting the language in these bills in other states from “must report” language to “may report” maintaining discretion for the financial professional involved.

  1. SB496 expands the current definition of a “mandated reporter” in the state of California to include a broker dealer or a financial adviser.  Any such reporter who “…has observed or has knowledge of..” such an incident, “… that reasonably appears to be financial abuse…” or “who reasonably suspects that abuse… shall report the known or suspected abuse…”
  2. There are mandated civil penalties for up to $5000 for each failure to report.

FPA National has created a one-click email for every member in California, on the national website, that will go directly to the office of each member’s representatives in the Senate and the Assembly and express our views on this important piece of legislation.

Please take a moment and click this link to send your note (text available on the website) directly to your legislator regarding FPA’s issues with SB496!


Thank you for your time, and your consideration.

Best Regards,

Benjamin Lemon

President, Financial Planning Association of California Council