BILL ANALYSIS Ó
SENATE COMMITTEE ON PUBLIC SAFETY
Senator Loni Hancock, Chair
2015 - 2016 Regular
Bill No: AB 2721 Hearing Date: June 14, 2016
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|Author: |Rodriguez |
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|Version: |February 19, 2016 |
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|Urgency: |No |Fiscal: |Yes |
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|Consultant:|ML |
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Subject: Elder and Dependent Adult Fraud: Informational Notice
HISTORY
Source: Author
Prior Legislation:AB 3095 (Committee on Aging and Long-Term
Care: Berg, Daucher, Levine and Lowenthal) - Ch.
893, Stats. 2004
Support: Unknown
Opposition:None known
Assembly Floor Vote: 78 - 0
PURPOSE
The purpose of this bill is to require the Department of Justice
to develop and distribute an informational notice that warns the
public about elder and dependent adult fraud and provides
information regarding how and where to file complaints.
Existing law defines "elder" as "any person who is 65 years of
age or older." (Penal Code § 368, subd. (g).)
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Existing law states that upon conviction of any felony it shall
be considered a circumstance in aggravation in imposing the
upper term if the victim of an offense is particularly
vulnerable, or unable to defend himself or herself, due to age
or significant disability. (Penal Code § 1170.85, subd. (b).)
Existing law specifies that any person who is not a caretaker
who violates any provision of law proscribing theft,
embezzlement, forgery, fraud, or identity theft, with respect to
the property or personal identifying information of an elder or
a dependent adult, and who knows or reasonably should know that
the victim is an elder or a dependent adult, is punishable as
follows:
a) By a fine not exceeding $2,500, or by imprisonment in a
county jail not exceeding one year, or by both that fine
and imprisonment, or by a fine not exceeding $10,000, or by
imprisonment in the county jail for two, three, or four
years, or by both that fine and imprisonment, when the
moneys, labor, goods, services, or real or personal
property taken or obtained is of a value exceeding $950; or
b) By a fine not exceeding $1,000, by imprisonment in a
county jail not exceeding one year, or by both that fine
and imprisonment, when the moneys, labor, goods, services,
or real or personal property taken or obtained is of a
value not exceeding $950. (Penal Code § 368, subd. (d).)
Existing law provides that any caretaker of an elder or a
dependent adult who violates any provision of law proscribing
theft, embezzlement, forgery, fraud, or identity theft, with
respect to the property or personal identifying information of
that elder or dependent adult, is punishable as follows:
a) By a fine not exceeding $2,500, or by imprisonment in a
county jail not exceeding one year, or by both that fine
and imprisonment, or by a fine not exceeding $10,000, or by
imprisonment in the county jail for two, three, or four
years, or by both that fine and imprisonment, when the
moneys, labor, goods, services, or real or personal
property taken or obtained is of a value exceeding $950; or
By a fine not exceeding $1,000, by imprisonment in a county
jail not exceeding one year, or by both that fine and
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imprisonment, when the moneys, labor, goods, services, or
real or personal property taken or obtained is of a value
not exceeding $950. (Penal Code § 368, subd. (e).)
This bill requires the Department of Justice (DOJ) to develop
and distribute an informational notice that warns the public
about elder and dependent adult fraud and provides information
regarding how and where to file complaints.
This bill also requires the notice to be made available on the
Internet Web site of the Attorney General.
RECEIVERSHIP/OVERCROWDING CRISIS AGGRAVATION
For the past several years this Committee has scrutinized
legislation referred to its jurisdiction for any potential
impact on prison overcrowding. Mindful of the United States
Supreme Court ruling and federal court orders relating to the
state's ability to provide a constitutional level of health care
to its inmate population and the related issue of prison
overcrowding, this Committee has applied its "ROCA" policy as a
content-neutral, provisional measure necessary to ensure that
the Legislature does not erode progress in reducing prison
overcrowding.
On February 10, 2014, the federal court ordered California to
reduce its in-state adult institution population to 137.5% of
design capacity by February 28, 2016, as follows:
143% of design bed capacity by June 30, 2014;
141.5% of design bed capacity by February 28, 2015; and,
137.5% of design bed capacity by February 28, 2016.
In December of 2015 the administration reported that as "of
December 9, 2015, 112,510 inmates were housed in the State's 34
adult institutions, which amounts to 136.0% of design bed
capacity, and 5,264 inmates were housed in out-of-state
facilities. The current population is 1,212 inmates below the
final court-ordered population benchmark of 137.5% of design bed
capacity, and has been under that benchmark since February
2015." (Defendants' December 2015 Status Report in Response to
February 10, 2014 Order, 2:90-cv-00520 KJM DAD PC, 3-Judge
Court, Coleman v. Brown, Plata v. Brown (fn. omitted).) One
year ago, 115,826 inmates were housed in the State's 34 adult
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institutions, which amounted to 140.0% of design bed capacity,
and 8,864 inmates were housed in out-of-state facilities.
(Defendants' December 2014 Status Report in Response to February
10, 2014 Order, 2:90-cv-00520 KJM DAD PC, 3-Judge Court, Coleman
v. Brown, Plata v. Brown (fn. omitted).)
While significant gains have been made in reducing the prison
population, the state must stabilize these advances and
demonstrate to the federal court that California has in place
the "durable solution" to prison overcrowding "consistently
demanded" by the court. (Opinion Re: Order Granting in Part and
Denying in Part Defendants' Request For Extension of December
31, 2013 Deadline, NO. 2:90-cv-0520 LKK DAD (PC), 3-Judge Court,
Coleman v. Brown, Plata v. Brown (2-10-14). The Committee's
consideration of bills that may impact the prison population
therefore will be informed by the following questions:
Whether a proposal erodes a measure which has contributed
to reducing the prison population;
Whether a proposal addresses a major area of public safety
or criminal activity for which there is no other
reasonable, appropriate remedy;
Whether a proposal addresses a crime which is directly
dangerous to the physical safety of others for which there
is no other reasonably appropriate sanction;
Whether a proposal corrects a constitutional problem or
legislative drafting error; and
Whether a proposal proposes penalties which are
proportionate, and cannot be achieved through any other
reasonably appropriate remedy.
COMMENTS
1. Stated Need for This Bill
The author states:
Consumer fraud perpetrated against senior citizens is a
very serious issue; it creates fear, difficulty and
financial problems for the elderly. Worst of all, it
victimizes them and robs them of their savings and their
peace of mind. A recent study found that around thirty
percent of complaints about consumer fraud come from
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senior citizens, along with just over a quarter of
identity theft complaints. According to a national
consumer group nearly a third of all telemarketing fraud
victims are age 60 or older. Studies by AARP show that
most of older fraud victims don't realize that the voice
on the phone could belong to someone who is trying to
steal their money.
Senior citizens are viewed as easy targets and the scams
that target them come in many different forms. Some
include scams about Medicare, funeral arrangements, and
prescription drugs. In these scams, the perpetrator may
pretend to be an official medical or government worker
and ask for confidential details or payment. Many of
these schemes are perpetrated through telemarketing and
the Internet. The common thread that runs through almost
all telemarketing and other scams is the demand for
payment upfront. While California cannot constantly be
there to keep our citizens safe, we can create an
informational brochure to be distributed to retail
outlets and banks that access money or sell financial
instruments. AB 2721 will place vital information in
locations where seniors typically access their funds when
they are being scammed. The brochure will serve as a
resource for seniors before they lose scarce retirement
dollars and a source of information to let them know
where to report fraud and scams.
The California Department of Justice regularly issues
consumer alerts warning consumers against scams. These
alerts are generally public service announcements that
are made in the media and on the DOJ website. Some past
consumer alerts have included information on "A Roundup
of Senior Citizen Scams Alert (grandparent scams, IRS,
etc.) and Veteran Pension Poaching Scam Alert." These
are general broadcast alerts to the general population as
a whole and do not provide needed information at the
location where seniors withdraw or access money during a
scam. The Department of Justice, by developing and
distributed this informational about scams will help
prevent dependent adult fraud and provides information
regarding how and where to file complaints. The bill
would also require the notice to be made available on the
Internet Web site of the Attorney General.
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2. Background
Over 44 million Americans, or nearly one in four seniors, are
victims of elder abuse each year with a substantial proportion
of it being financial abuse. The senior population loses a
combined total of over $36 billion every year due to fraud and
financial abuse.<1> Every 10 seconds a senior in California is a
victim of financial abuse, and over $4.8 billion in assets are
at stake every year in California. There are more residents over
65 in California than in any other state, and the state's
elderly population will almost double within the next 20 years
from 3.7 million to more than 6.4 million according to the U.S.
Census Bureau.<2>
Financial abuse is often committed by serial abusers who will
come back again for money. For example, a senior who loses $20
due to financial exploitation will go on to lose an average of
$2,000 to other scams in the course of five years.<3> The
typical profile of perpetrators is likely to be individuals who
are between 40 and 59 years old with females being just as
likely as males to be the perpetrator. The vast majority of
perpetrators have a close relationship to victim, such as a
caregiver, family member or friend where approximately
two-thirds are family members of the victim,<4> but these crimes
also come from random individuals posing as sweepstakes, lottery
or IRS representatives alongside romantic, healthcare, or
magazine claims, among other scams.
The Federal Trade Commission says that fraud complaints to its
offices by individuals 60 and older have risen at least 47
percent between 2012 and 2014, but it is difficult to know the
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<1> https://www.truelinkfinancial.com/research
<2>
http://www.cwda.org/publication/anna-and-joe-importance-adult-pro
tective-services-fight-against-elder-financial-abuse
<3>
http://www.forbes.com/sites/johnwasik/2016/05/04/how-to-beat-the-
elder-financial-abuse-epidemic/#52e3645c72ea
<4>
http://www.cwda.org/publication/anna-and-joe-importance-adult-pro
tective-services-fight-against-elder-financial-abuse
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actual amount of elderly fraud cases.<5> Seniors are often
deeply ashamed and humiliated after they have figured out that
they have been scammed and consequently fail to report the crime
or tell family members that they have been victims of elderly
financial abuse. Research confirms that in New York State, only
1 in 44 cases of elderly financial abuse were actually
reported.<6> In California specifically, 1 in 100 incidents of
elder financial abuse is actually reported.<7>
A sample voicemail left by a fraudster goes as follows:
This is the Internal Revenue Service and this call is for
you. The issue is extremely time sensitive. As soon as
you receive this message, I need you to leave your work
aside and dial the following number?this is Officer John
Smith and I am working with the IRS. If you or your
lawyer fails to return the call, then the only thing I
can do is wish you good luck as this situation unfolds on
you. Goodbye.
3. Legislative History and Intent of Elder Abuse
Elder abuse was identified as a discrete crime in 1986 and abuse
of a dependent person was in 1984. Although the statute has
been renumbered, the language originally stated:
Any person, who, under circumstances or conditions likely
to produce great bodily harm or death, willfully causes
or permits any elder or dependent adult, with knowledge
that he or she is an elder or dependent adult, willfully
causes or permits the person or health of the elder or
dependent adult to be placed in a situation in which his
or her person or health is endangered is punishable by
imprisonment in the county jail not exceeding one year or
in state prison for two, three or four years. [Original
Penal Code § 368, subd. (a) as cited in People vs.
Heitzman (1994) 9 Cal.4th 189, 194]
------------------------
<5>
http://www.consumerreports.org/cro/consumer-protection/preventing
-elder-abuse
<6> Ibid.
<7>
http://www.cwda.org/publication/anna-and-joe-importance-adult-pro
tective-services-fight-against-elder-financial-abuse
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In 1994, the California Supreme Court construed Penal Code
Section 368 as requiring a tort grounded duty of care to save
the statute from being unconstitutionally vague. The Court in
Heitzman stated:
In 1983, the Legislature passed the state's first law
focusing exclusively on those 65 years of age or older,
requiring elder care custodians and other specified
professionals to report instances of elder abuse.
(Welfare & Institutions Code, § 9380- 9386, added by
Stats. 1983, ch. 1273, § 2 and repealed by Stats. 1986,
ch. 769, § 1.3, eff. Sept. 15, 1986.) That same year,
Senate Bill No. 248, 1983-1984 Regular Session, was
introduced at the request of the Santa Ana Police
Department. An analysis of the bill prepared for the
Senate Committee on the Judiciary indicates that the goal
of the legislation was to aid in the prosecution of
people who harm or neglect dependent adults. (Senate
Committee on Judiciary, Analysis of Senate. Bill No. 248
(1983-1984 Reg. Sess.) p. 2.) According to this
document, law enforcement agencies receiving reports
concerning suspected abuse or neglect of dependent adults
were having difficulty finding Penal Code sections under
which they could prosecute such cases. (Ibid.) The
solution proposed by the bill was to establish the same
criminal penalties for the abuse of a dependent adult as
those found in sections 273a and 273d for child abuse.
(Sen. Com. on Judiciary, Analysis of Sen. Bill No. 248.)
When drafting the new legislation, the bill's author
lifted the language of the child abuse statutes in its
entirety, replacing the word 'child' with 'dependent
adult' throughout (internal citation omitted).
After the statute was enacted late in 1983, several
non-substantive changes were made. (Stats. 1984, ch.
144, § 160, p. 482.) Later, in conjunction with
legislation designed to consolidate the two sets of
conflicting reporting laws for elder abuse and dependent
adult abuse, a 1986 amendment to section 368(a) made the
section expressly applicable to elders as well as
dependent adults. (Stats. 1986, ch. 769, § 1.2, p. 2531,
urgency measure eff. Sept. 15, 1986.) [Heitzman id at
245.]
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In 2004, AB 3095 (Committee on Aging and Long Term Care, Ch.
893, Stats of 2004), related to conditions of probation when an
offender is guilty of the crime of elder abuse, as specified.
However, the Senate amended AB 3095 to strike "with knowledge
that he or she is an elder or dependent adult" and instead
included any person who "knows or reasonably should know that a
person is an elder or dependent adult." This language is
presumably broader than simple knowledge because it includes
persons who reasonably should have known of the victim's status
as an elderly or dependent person.
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