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Most U.S. investment advisory firms haven’t introduced policies to protect seniors and other sorts of vulnerable investors, a regulatory review has found.

The North American Securities Administrators Association (NASAA) reported that across 1,200 compliance reviews of registered investment advisers by U.S. state securities regulators, 59% didn’t have policies or procedures in place to combat the financial exploitation of vulnerable clients.

“The results of this multi-state coordinated initiative show that investment advisers must make improvements in recognizing and reporting cases of suspected abuse,” said Lisa Hopkins, president of NASAA and West Virginia’s senior deputy commissioner of securities, in a release.

“Our hope is that this data will foster greater and earlier detection and reporting of suspected financial exploitation of older Americans,” she added.

Earlier this year, the Canadian Securities Administrators adopted rule changes that aim to enable firms to help protect vulnerable investors.

The rules, which take effect on Dec. 31, will require firms to take “reasonable steps” to obtain information for a trusted contact person from clients. The rules also create a framework for firms to place temporary holds on account activity where there are concerns about possible exploitation.

Alongside the lack of policies and procedures to protect seniors, the U.S. regulators’ reviews also found the most common compliance deficiencies involved registration issues, books and records, and contracts, followed by supervisory lapses and problems involving advertising.

One area where firms have improved significantly is cybersecurity, NASAA noted.

The reviews found cyber issues at 5.3% of firms, down from 26% in 2019.

“Cybersecurity has been a priority for NASAA, and we are pleased to see the decrease in deficiencies in this category,” said Michael Huggs, Mississippi’s securities division director.

“I believe the investment adviser industry is getting the message of how important cybersecurity is and is starting to implement policies and practices as well as taking advantage of the free cybersecurity checklist offered by NASAA to help assess their cybersecurity practices,” he said.