BILL ANALYSIS Ó
AB 477
Page A
Date of Hearing: April 23, 2013
ASSEMBLY COMMITTEE ON AGING AND LONG-TERM CARE
Mariko Yamada, Chair
AB 477 (Chau) - As Amended: April 15, 2013
SUBJECT : Elder and dependent adult abuse: mandated reporting
SUMMARY : Elder and Dependent Adult Abuse: Mandated Reporting.
Specifically, this bill : Includes notaries public in the
definition of mandated reporters of suspected financial abuse of
an elder or dependent adult, and would require notaries to
report known, or suspected, instances of financial abuse of an
elder or dependent adult if the notary public has observed or
has knowledge of suspected financial abuse in connection with
providing notary services.
EXISTING LAW :
1)Grants the Secretary of State authority over notaries public.
2)Establishes the Elder and Dependent Adult Abuse Civil
Protection Act (EADACPA) to protect the state's elder and
dependent adult population from abuse and exploitation
(Welfare and Institutions Code Sec. 15600 et seq.) EADACPA
recognizes that elders and dependent adults may have
developmental disabilities and cognitive impairments, such as
Alzheimer's disease and other dementia disorders, which often
leave them incapable of seeking help and protection from
others; and that elders and dependent adults suffer physical
impairments and poor health, conditions that place them in a
dependent and vulnerable position. Further, legislative
findings codified in EADACPA state that cases of elder and
dependent adult abuse are seldom prosecuted as criminal
matters, and few civil cases are brought in connection with
this abuse due to problems of proof, court delays, and the
lack of incentives to prosecute these suits.
3)Establishes the Financial Abuse Reporting Act of 2005 which
defines who 'mandated reporters' of known financial abuse are,
the settings in which their legal obligation to report reside,
and the activities which constitute a reportable offense. The
Act further details exceptions which would preclude a mandated
reporter from reporting, penalties for failure to report, and
conditions under which suspected instances of financial abuse
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may be reported.
4)Establishes immunity from criminal and civil liability for
mandated reporters who make reports of financial abuse in good
faith.
5)Directs county adult protective services (APS) on
cross-reporting obligations for reports of financial abuse
which occur in the community, versus those that occur in a
long-term care facility.
6)Requires APS to provide financial abuse reporting
instructional materials to mandated reporters.
THIS BILL:
1)Would establish an affirmative obligation for a notary public
who, in connection with providing notary services, has
observed or has knowledge of suspected financial abuse of an
elder or dependent adult, to report that abuse to APS or local
law enforcement within two working days.
2)Subject notaries to the same liabilities, limitations, and
definitions as those imposed upon reporters within financial
institutions.
FISCAL EFFECT : Unknown
Author's Statement: According to the author, AB 477 will help
protect California seniors (and other, younger adults living
with disabilities) by making notaries public mandated reporters
of financial abuse of an elder or dependent adult. Specifically,
this bill includes notaries public within the definition of
mandated reporters of suspected financial abuse of an elder or
dependent adult for purposes of the EADACPA. In turn, AB 477
will provide an additional layer of protection in the fight
against elder or dependent adult abuse by making notaries public
mandated reporters of financial abuse.
Arguments in Support: The Consumer Federation of California
writes that California's seniors are a vulnerable population who
can often fall prey not only to manipulation and abuse not only
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of strangers but of those who are in the senior's life. The
existing mandated reporters designated by the EADACPA are able
to report known or suspected financial abuse of an elder, and
that AB 477 simply extends the existing requirements to apply to
notaries public. Because of their routine involvement in the
processing of legal documents, notaries public are often in a
position to note potential abuse, and report it.
Arguments in Opposition: The California Escrow Association
writes that due to their limited exposure to principals or
signatories and often on only one occasion during the course of
a transaction. Notaries public are not trained to recognize
elder abuse and their roles are ministerial in nature; the
notary verifies the identification of the signer and either
observes the signing of the document, or accepts the affirmation
that a signature had occurred. Notaries are not required to
know the content of the documents, nor how to detect elder or
dependent adult financial abuse. Given that California's elder
and dependent adult abuse reporting system is designed for over
reporting, the arguments put forth about a notary's lack of
knowledge of document content, or lack of knowledge on how to
detect elder abuse does not necessarily respond to the intent of
the measure.
California Land Title Association writes that the escrow
process, unlike ongoing banking relationships, does not offer
any appreciable time for any title company employee/notary to
ascertain if financial abuse of an elder is taking place.
Creating liability for title company personnel who are notaries
is unwarranted, poor public policy, and assumes that the
exposure to the subject is satisfactory to provide them with all
information necessary to evaluate the signer's mental capacity,
and whether or not the transaction is considered abuse. Title
companies are supposed to be objective parties to the
transaction that do not have any vested interest in the outcome,
and AB 477 will create a conflict when they act in that
capacity. Like the arguments put forth in opposition from the
California Escrow Association, California Land Title Association
misunderstands the purpose of California's elder and dependent
adult reporting system. AB 477 is not requiring notaries to
evaluate mental capacity, or abuse. AB 477 is placing an
affirmative responsibility upon notaries to report abuse if they
know or suspect that it may be present. Using a reasonable
standard to protect the life savings, resources that prevent
dependency upon public social services, and property of older or
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dependent adults is clearly within the framework.
Background and Discussion: The Secretary of State is charged
with the responsibility of appointing and commissioning notaries
public in the State of California. The Secretary of State
strives to ensure that applicants and commissioned notaries
public possess the requisite honesty, credibility, truthfulness,
and integrity to fulfill the responsibilities of the position.
Character is germane to the qualifications of the office of a
notary public, given the nature of the duties and
responsibilities. Government, business, and the public depend
on the integrity of notaries public to take the required steps
in authenticating signatures and properly completing
transactions. The issue of good character is the foundation of
all notarial acts. Reporting known or suspected abuse of
elderly or dependent adults, arguably, falls within the
framework of "good character." To be eligible for appointment, a
person must be a California resident at the time of appointment
(unless appointed to serve on a military or naval reservation);
be at least 18 years of age; complete a course of study approved
by the California Secretary of State; pass a written, proctored,
closed-book examination; and pass a background check. About
160,362 notaries public are commissioned and operate in
California.
Elder and Dependent Abuse Reporting : Under California's elder
and dependent adult abuse reporting laws, certain individuals
are mandated to report elder abuse and neglect. Although
multiple agencies are involved, the primary three responders are
APS, Ombudsmen, and law enforcement.
Though nobody knows precisely the extent of elder and dependent
adult abuse, estimates from national studies suggest that only 1
in 14 incidences of elder and dependent adult abuse or neglect
are reported. Even fewer cases of financial abuse - only 1 in
100 - are reported. As the elderly population increases, and as
more disabilities arise within communities, so will abuse.
Currently, the state has roughly 4.5 million people over the age
of 65 - the largest older adult population in the nation. This
figure is projected to climb to about 6.2 million by 2020, and
by 2035, 19.8% of the population will be 65+<1>. With the
increase in life spans of the elder population comes increased
risk of financial abuse to seniors as well as other dependent
adults.
---------------------------
<1> California Department of Finance Demographic Research Unit
AB 477
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Each year, thousands of elderly and dependent adults are
targeted for financial exploitation because they are socially
isolated, dependent on others for assistance, or easily
intimidated. Notaries are well positioned, to report concerns
that there may be a risk of swift and devastating depletion of
an elderly victim's lifetime savings, property, or securities.
AB 477 reinforces an existing responsibility that banks and
other institutions have to their customers - to report
potentially fraudulent activities and serve in their customers'
best interests. Under AB 477, notaries would join many others
who are required to report suspected elder and dependent adult
abuse, including financial abuse. Existing law requires
mandated reports from social workers, home health care workers,
various state and county employees, law enforcement, health care
professionals, long-term care industry and nursing home workers,
employees of financial institutions, clergy and more. This
ensures that those who are likely to witness or suspect abuse in
the course of their work will make reports to law enforcement or
APS, who in turn are trained to investigate and intervene as
appropriate. Again, the focus is on reporting-even over
reporting. AB 477 does not require notaries public to
intervene, investigate and/or detect abuse-simply report if and
when they suspect, or know, that abuse may be occurring.
COMMENTS : The author has amended AB 477 in an important way.
Previously, AB 477 added notaries public to a code section
designed to address the affirmative reporting obligations of
employees of financial institutions. WIC 15630.1 creates a
framework for a comprehensive mandate that includes defining who
"mandated reporters" of suspected elder or dependent adult
financial abuse are, what they must report, how to resolve a
single report when two mandated reporters witness the same
event, whom to report to, exempts reporting when no
corroborating evidence exists or professional judgment indicates
otherwise, and limits penalties for not reporting to $1000 or
$5000 depending upon circumstances, to be paid by the employer,
but only if the State Attorney General, district attorney, or
county counsel seeks it. 15630.1 (d)(1) is the heart of the
financial abuse reporting mandate. However, the mandate is for
those with direct contact with an elder or dependent adult, or
who reviews or approves the elder or dependent adult's financial
documents, records, or transactions, in connection with
providing financial services, and who, within the scope of their
employment or professional practice has observed or has
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knowledge of what reasonably appears to be financial abuse.
Though many notaries public are employees of, or associated with
financial institutions, notaries operating outside the scope of
a financial institution would not be included. The amendments
of April 15 address this distinction.
REGISTERED SUPPORT / OPPOSITION :
Support
California Senior Legislature - Sponsor
California Association for Health Services at Home (CAHSAH)
California Police Chiefs Association Inc.
Consumer Federation of California
Center of Excellence on Elder Abuse and Neglect
1 individual
Opposition
California Advocates, Inc.
California Land Title Association
Analysis Prepared by : Robert MacLaughlin / AGING & L.T.C. /
(916) 319-3990