A new report by the American Bankers Association Foundation found that more than half of bankers in states with bank transaction “hold” laws have used them to prevent elder financial exploitation.
Roughly half of states have hold laws that allow depository institutions to delay or hold transactions when there is suspected financial exploitation of an elder or “vulnerable” person. According to a survey commissioned by the ABA Foundation, 54.5% of respondents in states with hold laws have used them for their intended purpose.
Nearly 90% of banks in states without hold laws indicated that having one in place would be beneficial.
Among survey respondents who have utilized a hold law in their state, nearly a quarter (23.8%) said they delay suspicious transactions a few times a month, while others indicated holding transactions monthly (19%), daily (7.1%) or weekly (4.8%). Of the banks in states with hold laws, 52.4% of respondents also believe longer hold periods and flexibility on specific lengths are important to appropriately investigate cases and prevent fraud.
“This survey provides an important look at how banks are using hold laws to protect their older customers from financial exploitation,” said Sam Kunjukunju, vice president, consumer education for the ABA Foundation. “States will benefit from the data and testimonials contained in this report, including ideas to make it easier for banks to keep their customers safe.”
