Ahead of the MFDA's Seniors Summit scheduled for October 30,
2019, the MFDA released a brief bulletin of two dealer best
practices:
- requesting clients to name a trusted
contact person (TCP); and
- placing a temporary hold on
transactions where there are reasonable concerns regarding
financial exploitation of a client or a client's mental
capacity.
Interestingly, both practices are triggered when the investment
advisor or dealer has "reasonable concerns" about a
client's capacity and/or financial situation.
Trusted Contact Person
A TCP is a person that an advisor may call when he or she has
reasonable concerns about a client's mental capacity. A TCP is
not intended to be a substitute for a power of attorney (POA), but
a complement to the POA and almost always should be a separate
person. The TCP should not be an individual who has an interest in
the client's account and/or is involved in making financial
decisions to the account. As a best practice, the
