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IOSCO seeks to protect aged investors from fraud, other risks

IOSCO seeks to protect aged investors from fraud, other risks

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THE International Oragnisa- tion of Securities Commissions (IOSCO), the global securities regulator, has launched a new report that seeks to protect ageing investors from financial fraud, unsuitable investment and other risks as part of efforts to safeguard senior investors from losing their hard-earned nest eggs.

Its board on Monday published the report that examined the growing vulnerability of ageing investors to financial fraud and other risks and identified sound practices for enhancing their protection.

The report- Senior Investor Vulnerability- revealed that seniors are at a higher risk than other investors of losing money to fraud or of being misled by others.  It also indicated that the biggest risks to senior investors are unsuitable investments, financial fraud and their diminished cognitive capability which affects their financial decision-making. Complex products, deficient financial literacy, and social isolation pose additional risks to senior investors.

IOSCO noted that ageing populations are a challenge to investor protection, as ageing and associated levels of physical and cognitive decline increasingly debilitate the capabilities of investors worldwide. Research indicated that age-induced cognitive decline is linked to impaired financial decision-making. Some research also correlated ageing with increased susceptibility to financial exploitation and fraud. These vulnerabilities are growing just as many investors assume greater responsibility for their retirement and financial future.

The IOSCO report explored the views and experiences of IOSCO members regarding senior investor vulnerability while providing a list and description of sound practices for both regulators and financial services providers. The report also included a non-exhaustive bibliography of literature that may be helpful to regulators and others.

According to the report, the sound practices to be promoted by securities market regulators are     delivering of educational programmes and resources targeting senior investors, fostering the development of senior-focused expertise within existing regulatory, educational or advisory programmes, conducting research projects to better understand the risks and issues facing senior investors and the incidence and mechanics of investment fraud that affect seniors in their jurisdictions and development of guidelines and training programmes for personnel reviewing transactions conducted with senior investors.

The sound practices to be promoted by financial services providers include offering support to senior investors experiencing a life event during the product lifecycle and providing training and support for employees of financial services firms.

IOSCO is global body of securities regulators and its members regulate more than 95 per cent of the world’s securities markets in more than 115 jurisdictions. Nigeria is a member of both the board of IOSCO and its influential Committee on Retail Investors, otherwise known as Committee 8.

 

The post IOSCO seeks to protect aged investors from fraud, other risks appeared first on The Nation Nigeria.

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