Maryland’s “SAFE” Act Offers Additional Layer of Protection to Seniors

Maryland’s “Statute Against Financial Exploitation Act” (SAFE) was enacted in October 2021. In the past year, it has proven to be a valuable additional layer of protection for Maryland seniors.

What gave rise to the SAFE Act?

Troublingly, in recent years, there have been growing numbers of seniors targeted for financial exploitation. Some seniors were targeted by strangers, such as Internet scam artists.  Other seniors were targeted by those closer to them, such as family members and caregivers. Maryland law offered few civil protections to an individual who was the victim of financial exploitation. Criminal prosecutions were available for especially egregious acts of financial abuse, but even the best-intentioned state’s attorney’s offices often had higher priorities, such as violent crime. Civil claims were curtailed by statute of limitations issues and concerns about the cost of pursuing the claims.

What is the SAFE Act?

In a nutshell, the SAFE Act is a statutory “cause of action”, meaning it is the grounds by which a civil suit can be filed. The SAFE Act is intended to supplement – not take the place of – existing civil and criminal remedies. A suit filed under the SAFE Act can be filed by the victim, by his/her financial power of attorney, or by his/her estate.

Who is protected under the SAFE Act?

The SAFE Act protects older persons, defined to be age 68 and over. The SAFE Act also protects a “susceptible adult”, regardless of age. A “susceptible adult” is any adult who may: need assistance with one or more activities of daily living; be unable to protect their rights; suffers from addiction or mental disability; and/or has diminished executive functioning.

What types of financial exploitation are prohibited by the SAFE Act?

The Act provides for a civil cause of action against a person who:

• Has a position of trust and confidence with a susceptible adult or older adult (such as a trustee or a financial power of attorney) and who knowingly uses or attempts to obtain or use the victim’s funds or assets with the intent to deprive the victim of the use or possession of the assets OR
• By deception, false pretenses, intimidation, coercion, or excessive persuasion, obtains or uses (or tries to obtain or use) a victim’s funds or assets with the intent to deprive the victim of the use or possession of the assets OR
• Knows or should know that a victim lacks the capacity to consent but nonetheless uses or attempts to obtain or use the victim’s funds or assets with the intent to deprive the victim of the use or possession of the assets.

What are the remedies available under the SAFE Act?

In addition to compensatory damages to restore the victim to his/her previous financial state, the court has the discretion to award “treble damages”. These are effectively a form of punitive damages equal to three times the amount of compensatory damages. The court also has the discretion to require the wrongdoer to reimburse the victim for his/her attorney’s fees in filing the lawsuit.

What is the time limit for filing a lawsuit under the SAFE Act?

Unlike most civil suits in Maryland, which have a statute of limitations of 3 years, a suit under the SAFE Act has a 5-year statute of limitations. Moreover, if criminal charges are filed against the wrongdoer, the statute of limitations for a civil SAFE Act claim will be paused until the criminal prosecution can conclude. Realistically, however, the sooner a victim or his/her family can file a lawsuit, the better the chances of recovering the misappropriated assets.

Might this promote frivolous suits?

Contemplating this possibility, the legislature built in a deterrent. If the court determines that a suit has been filed frivolously, the court can assess against the party who filed the suit the attorney’s fees incurred by the party who defended the suit. This will perhaps make folks think twice before racing to court to file a suit that is not well-intentioned.

Thanks to the Maryland State Bar Association Vulnerable Adult Exploitation Task Force for their tireless lobbying and thanks to the Maryland legislature for acting to give Maryland seniors an important additional layer of protection.

If you or a loved one would like to discuss a potential SAFE Act claim, please contact Jeremy Rachlin at (301) 656-1177 or jrachlin@bulmandunie.com.