Lawmakers approved bipartisan bill to combat fraud among seniors

Lawmakers have taken a bipartisan step to better protect vulnerable adults from financial fraud.

The House passed HR 2478, the Financial Exploitation Act of 2025, by a vote of 414-2 last week. The bill would allow open-end funds (mutual funds, most exchange-traded funds) and their transfer agents to suspend reimbursement claims from the elderly and disabled if financial exploitation is suspected. The transfer agent maintains records of shareholders and processes transactions.

“Many elderly and vulnerable adults need an extra layer of protection from the scams that are tragically common in today’s world, and (this bill) is a common-sense step to protect parents, grandparents, and families in our nation’s communities,” the bill’s lead sponsor, Rep. Ann Wagner (R-Missouri), said in a statement when the House approved the bill.

The bill is currently in the Senate, but it is unclear whether or when lawmakers will take up the House-passed bill or a companion bill, S.2840, pending in the Banking Committee. An earlier bill passed the House 419-0 in 2023 but expired after the Senate took no action.

According to the Federal Trade Commission’s annual report to Congress released in December, the amount of fraud reported to the Federal Trade Commission by adults 60 and older will reach $2.4 billion in 2024, a 26.3% increase from $1.9 billion in 2023 and a 300% increase from the $600 million reported in 2020. This increase was driven by fraud involving personal losses of $100,000 or more, accounting for $1.6 billion or 68% of the total.

But because most fraud goes unreported, the FTC estimates that the net losses experienced by seniors could reach $81.5 billion in 2024. Most of the losses were due to investment fraud.

Although adults over 60 are more likely to report large losses, financial fraud against all generations has increased over time. Total losses reported to the FTC in 2025 reached approximately $15.9 billion, a record high and an increase of approximately 27% from $12.5 billion in 2024. Since 2020, reported losses have increased nearly 430%, according to the FTC.

The bill passed by the House of Representatives aims to prevent victims of fraud from parting with their money. Specifically, it allows a fund company or transfer agent to defer requested redemptions if it determines that the transaction involves the financial exploitation of a person over the age of 65 or an adult who is unable to protect his or her interests due to a disability.

The bill states that the delay would initially be up to 15 days and could be extended for an additional 10 days if exploitation is determined to be involved. Longer delays may be imposed if authorized by a court, state regulator, or other appropriate authority.

The bill would also require the Securities and Exchange Commission, in consultation with certain other federal agencies, to submit to Congress within one year a report on regulatory and legislative policies that may reduce financial fraud among vulnerable adults.

The bill does not require investment firms to participate, but participating companies would be required to require customers to provide adult contact information (also known as a “trusted contact”) to be notified in certain circumstances, such as when fraud is suspected.

Many banks and other financial institutions already require account holders to have trusted contact information. Although the Financial Industry Regulatory Authority (FINRA) requires brokerages to make reasonable efforts to add trusted contacts to accounts, investors are not required to provide trusted contacts.

Scams can be difficult to spot, but there are some red flags that experts recommend looking out for, including when you’re asked to act quickly.

“Anytime there’s a sense of urgency…you have to stop,” said Jeff Carpenter, CEO of Weeky Federal Credit Union in Oklahoma City.

“Pause is the most important thing. If they can create a sense of urgency and move money quickly,” Carpenter said, it may be difficult to get it back.

His staff has thwarted attempted fraud, including the case of a 76-year-old woman who transferred $50,000 to a cryptocurrency account that scammers helped her open. They led her to believe that her credit union account had been compromised and that by moving it they were protecting her money. In this case, the victim’s daughter, who owned the joint account, was contacted, police were notified, and the money was recovered the next day.

Additionally, if you are asked to lie about what the money is used for, that’s a big red flag.

“Anytime someone says, ‘Don’t tell anyone about this,’ or encourages you to keep it a secret, or asks you to make up a story, you should be suspicious,” Carpenter said.