Empowering States to Protect Seniors from Bad Actors Act

This Act may be cited as the “Empowering States to Protect Seniors from Bad Actors Act”.

Congress finds the following:

(1) Data from the Federal Trade Commission shows that consumers reported losing—

(A) more than $10,000,000,000 to fraud in 2023, marking—

(i) the first time that fraud losses have exceeded that amount; and

(ii) a 14 percent increase over those reported losses in 2022; and

(B) more money to investment scams (specifically, more than $4,600,000,000) than any other category in 2023, which represents a 21 percent increase over those reported losses in 2022.

(2) Data from AARP, published in 2023, shows that 9 out of 10 adults in the United States encountered a fraud attempt in the past year.

(3) In 2021, AARP found that servicemembers are nearly 40 percent more likely to lose money to scams and fraud than civilians.

(4) For decades, State securities and insurance regulators have been leaders in the effort to protect older and sometimes vulnerable adults, including veterans, from financial exploitation.

(a) In general.— Section 989A of the Investor Protection and Securities Reform Act of 2010 (12 U.S.C. 5537) is amended to read as follows:

“989A. Grants to eligible entities for enhanced protection of senior investors and senior policyholders.—

(a) Definitions.— In this section:

(1) Eligible entity.— The term eligible entity means—

(A) the securities commission (or any agency or office performing like functions) of any State; and

(B) the insurance department (or any agency or office performing like functions) of any State.

(2) Senior.— The term senior means any individual who has attained the age of 62 years or older.

(3) Senior financial fraud.— The term senior financial fraud means a fraudulent or otherwise illegal, unauthorized, or improper act or process of an individual, including a caregiver or a fiduciary, that—

(A) uses the resources of a senior for monetary or personal benefit, profit, or gain;

(B) results in depriving a senior of rightful access to or use of benefits, resources, belongings, or assets; or

(C) is an action described in section 1348 of title 18, United States Code, that is taken against a senior.

(b) Grant program.—

(1) In general.— The Commission shall carry out a program under which the Commission shall make grants, on a competitive basis, to eligible entities, which—

(A) may use the grant funds—

(i) to hire staff to identify, investigate, and prosecute (through civil, administrative, or criminal enforcement actions) cases involving senior financial fraud;

(ii) to fund technology, equipment, and training for regulators, prosecutors, and law enforcement officers, in order to identify, investigate, and prosecute cases involving senior financial fraud;

(iii) to provide educational materials and training to seniors to increase awareness and understanding of senior financial fraud;

(iv) to develop comprehensive plans to combat senior financial fraud; and

(v) to enhance provisions of State law to provide protection from senior financial fraud; and

(B) may not use the grant funds for any indirect expense, such as rent, utilities, or any other general administrative cost that is not directly related to the purpose of the grant program.

(2) Authority of Commission.—

(A) Public information.— In carrying out paragraph (1), the Commission shall make public relevant actions of the Commission relating to carrying out that paragraph.

(B) Sense of Congress.— It is the sense of Congress that, in carrying out paragraph (1), the Commission should use the authority of the Commission under section 4A of the Securities Exchange Act of 1934 (15 U.S.C. 78d–1) to delegate the functions of the Commission under paragraph (1) to an employee or employee board that has experience working with or for State regulators on issues relating to the protection of senior investors, including such investors who are vulnerable.

(c) Applications.— An eligible entity desiring a grant under this section shall submit an application to the Commission, in such form and in such a manner as the Commission may determine, that includes—

(1) a proposal for activities to protect seniors from senior financial fraud that are proposed to be funded using a grant under this section, including—

(A) an identification of the scope of the problem of senior financial fraud in the applicable State;

(B) a description of how the proposed activities would—

(i) protect seniors from senior financial fraud, including by proactively identifying victims of senior financial fraud;

(ii) assist in the investigation and prosecution of those committing senior financial fraud; and

(iii) discourage and reduce cases of senior financial fraud; and

(C) a description of how the proposed activities would be coordinated with other State efforts; and

(2) any other information that the Commission determines appropriate.

(d) Performance objectives; reporting requirements; audits.—

(1) In general.— The Commission—

(A) may establish such performance objectives and reporting requirements for eligible entities receiving a grant under this section as the Commission determines are necessary to carry out and assess the effectiveness of the program under this section; and

(B) shall require each eligible entity that receives a grant under this section to submit to the Commission a detailed accounting of the use of grant funds, which shall be submitted at such time, in such form, and containing such information as the Commission may require.

(2) Report.— Not later than 2 years, and again not later than 5 years, after the date of enactment of the Empowering States to Protect Seniors from Bad Actors Act, the Commission shall submit to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives a report that—

(A) specifies each recipient of a grant under this section;

(B) includes a description of the programs that are supported by each such grant; and

(C) includes an evaluation by the Commission of the effectiveness of such grants.

(3) Audits.— The Commission shall annually conduct an audit of the program under this section to ensure that eligible entities to which grants are made under that program are, for the year covered by the audit, using grant funds for the intended purposes of those funds.

(e) Amount of grants.— The amount of a grant to an eligible entity under this section may not exceed $500,000 each year, unless the eligible entity serves as both the securities commission (or any agency or office performing like functions), and the insurance department (or any agency or office performing like functions), of a State, in which case the maximum amount of the grant may not exceed $1,000,000 each year.

(f) Subgrants.— An eligible entity that receives a grant under this section may, in consultation with the Commission, make a subgrant, as the eligible entity determines is necessary or appropriate—

(1) to carry out the activities described in subsection (b)(1)(A); and

(2) which may not be used for any activity described in subsection (b)(1)(B).

(g) Authorization of appropriations.— There are authorized to be appropriated to carry out this section $10,000,000 for each of fiscal years 2025 through 2030.”.

(b) Conforming amendment.— The table of contents in section 1(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Public Law 111–203) is amended by striking the item relating to section 989A and inserting the following: