The Elements

By Ironstone   |   September 8, 2015

What’s Wrong With Delaying Transactions When A Client Has Diminished Capacity?

Categories: Blog, Business Development, Operational Effectiveness


What's Wrong With Delaying Transactions When A Client Has Diminished Capacity

Guest Post Written By Carolyn Rosenblatt

Delay Is Not A Solution

The securities industry is pushing to impose temporary holds on certain transactions that may be precipitated by a client’s declining mental capacity or suspected financial abuse.  Sounds good in theory. Too bad it won’t solve the problem.  Holding transactions is not going to make the problem of predators go away.

A frail 94-year-old man was in the habit of giving his no-count son money for everything from drug rehab to have-a-fun-time.  Theirs was a sort of co-dependency.  Maybe dad felt needed and sonny just thought he could always manipulate dad for cash.  But when dad developed dementia, no one took action to stop this elder from playing into manipulation.  He had another son who was to take over as the appointed successor to dad on dad’s trust. The trust had dad’s big IRA and the rest of his cash in it.

Sonny flies out to see dad and takes him to dad’s broker. Dad lives in a nursing home and is totally dependent.  Dad, prompted by sonny, asks the broker for a cashier’s check for $60,000.  The broker delays for a week or so. Dad, prompted by the manipulative son, calls and wants to know where the check is.  Broker then hands over the cashier’s check and sonny of course gets it. The broker thinks he should call the other son, who he knows is appointed to be dad’s successor trustee, but he thinks he can’t because of privacy laws.

Next, sonny tells dad to ask the broker to give him a debit card for the cash management account, which is the rest of dad’s money. The broker again delays, this time for three months. Sonny again prompts dad to bug the broker. Broker then hands over the debit card. Fortunately it is mailed to the other son.

The Missing Pieces In FINRA’s Attempts To Stop Abuse

FINRA is trying to put a band-aid over a gaping wound. It won’t stop the bleeding.  The industry needs to offer a way of measuring diminished capacity.

At we have done this for you.

You need to get past privacy concerns legally. You need a standardized document following established legal principles that let you contact third parties.  That’s your best chance of stopping financial abuse.

Delay of transactions is nothing more than hoping for some magical thing to happen in the wait time. No one in the regulatory industry tells you what you are supposed to do while you delay transactions.

Delay does not stop abuse. It may put it off, but that’s it.  Unless you find a way to cut off the head of the evil snake of elder abuse it will continue to strike repeatedly.

What You Can Do

It takes a thought out senior-specific policy to do the job of stopping elder financial abuse.  Develop a proactive plan, create the necessary documents, and keep your clients safer.  Contact for more information.


To work with Ironstone or our affiliates, contact us at 1.800.917.8020, email us, complete our “contact us” form, or join the Ironstone – Financial Industry Professionals Practice Management Group on LinkedIn and start a discussion.

The foundation of our Performance Coaching and Consulting Programs are based on Ironstone’s Fundamental 4™, which is essential to design, develop, and sustain a successful business. Our ultimate goal is to help you avoid trial and error; shifting your mindset to launch your process of intentional change. [LEARN MORE]

Carolyn Rosenblatt is an R.N., B.S.N., Attorney and Mediator, with over 10 years in nursing and 27 years in legal practice. She has extensive experience working with both healthcare and legal issues of elders. She retired from litigation to become a consultant and mediator at, serving as an advisor to families with aging loved ones. In the course of advising families about the problems of getting older, Carolyn and her husband, Dr. Mikol Davis, Ed.D, became aware of the information gap in the financial services field. From their observations and concerns about this information gap, Aging Investor was formed.

Together they have conducted extensive research in the financial services industry and analyzed what regulators want financial service professionals to do about aging clients. Their efforts evolved into programs for industry professionals to develop senior-specific policies. They have extensive educational materials for financial service professionals about aging, cognitive impairment, avoiding prosecution, and intergenerational wealth transfers.


Photo credit: ©iStock/Getty Images



Practice Management

Ironstone is a learning and development consultancy with business acumen that translates across many industries. Our focus is on practice management strategies in order to enhance and improve both business and personal life. We support professionals who want major and comprehensive improvements that look at all aspects not just an isolated area for change. Ironstone has identified 4 key performance areas known as the Fundamental 4™, which are required to design, develop, and sustain a successful business.

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