Committee approves bill allowing banks to delay or refuse suspicious transactions to protect eligible adults

The committee voted to report Committee Substitute for Senate Bill 848 to the full Senate with a recommendation that it pass.

Counsel explained that the substitute adds a new article to state code to provide banking protections for eligible adults suspected to be victims of financial exploitation. Under the substitute, depository institutions, broker-dealers, and investment advisers may delay, refuse or prevent certain financial transactions if they suspect financial exploitation of an eligible adult or incapacitated adult. The substitute allows disclosure of such activity to an eligible adult's authorized third party and requires mandatory notifications to designated state agencies responsible for receiving reports of suspected maltreatment, including the West Virginia Department of Human Services, Bureau for Social Services, and the Office of the Attorney General.

Counsel said the committee substitute makes mostly technical changes and sets an initial time limit of 15 days for holds or delays unless the institution clears the action sooner or a court order provides otherwise. The substitute includes provisions to avoid conflicts between obligations of broker-dealers and investment advisers and it provides that there is no private cause of action against a covered financial institution or their employees unless there is clear and convincing evidence they did not act in good faith.

Mark Adkins, registered lobbyist for the Community Bankers of West Virginia, testified the bankers' associations supported the bill and that it would be a helpful tool to combat fraud against vulnerable adults. Guest witnesses from AARP were present but did not have extended remarks recorded in the transcript. After no amendments, the committee agreed to the language of the substitute and the vice chair moved that it be reported to the full Senate; the motion carried by voice vote.