The proposed bill aims to enhance consumer protections against financial fraud, particularly concerning vulnerable adults and individual account owners. It amends existing laws to require financial institutions to immediately notify the relevant departments when they suspect financial exploitation or fraud. Specifically, the bill mandates that financial institutions place an internal flag on accounts when there is a reasonable belief that financial exploitation or fraud may have occurred, is being attempted, or has been attempted. This internal flagging system is designed to alert employees about potential risks without imposing a legal obligation to withhold funds or refuse transactions.

Additionally, the bill introduces new provisions that clarify the responsibilities of financial institutions and their employees in cases of suspected financial fraud. It establishes immunity for financial institutions and their employees from liability when they act in good faith based on reasonable beliefs regarding financial exploitation or fraud. The bill also emphasizes the importance of having policies and procedures in place for both financial institutions and broker-dealers to ensure that they can effectively respond to potential fraud while protecting the interests of their clients. Overall, the legislation seeks to create a more robust framework for preventing financial fraud and protecting vulnerable individuals.

Statutes affected:
Original Bill: 74.34.215, 30A.22.210, 30A.22.020