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SACRAMENTO, Calif. – Gov. Arnold Schwarzenegger signed California’s elder abuse prevention bill into law August 29. SB1018 requires financial institution employees to report suspected abuse of the elderly or dependent adults to Adult Protective Services or law enforcement authorities. The law will not take effect until Jan. 1, 2007, a one-year delay designed to give financial institutions an opportunity to train tellers and set up procedures for reporting suspected abuse. Tellers will not be held responsible if they are wrong about a report or if they fail to report possible abuse, but state and local prosecutors could seek civil penalties up to $5,000 against the financial institution for failure to report suspected financial crimes. The bill also states the statutory fines may only be pursued by the state Attorney General or the local District Attorney. This provision helps to limit credit union exposure to frivolous and costly private suits filed by aggressive trial lawyers. The California Credit Union League and banking groups opposed the bill until industry representatives and the bill’s author, Sen. Joe Simitian (D-Palo Alto), negotiated key amendments to the final draft of bill. “We are still concerned employees and officers will now be expected to act as social workers or law enforcement auxiliaries,” said Ron Fong, League director of state government affairs. “The new law is a workable compromise and we appreciate the efforts of the author, proponents, and all parties in crafting this compromise measure.” In a prepared statement, Gov. Schwarzenegger praised the cooperation of the financial services industry, the law enforcement community and senior advocacy groups for reaching a compromise on the bill. The new law sunsets on January 1, 2013, unless subsequent legislation extends it. California has the largest population of seniors in the country and joins 18 other states in requiring bank and credit union employees to report possible abuse.

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