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Committee hears trusted-contact bill to help protect customers from fraud (HB1049)
Summary
Representative Bill Owens presented House Bill 1049 to allow financial institutions safe harbor to contact a designated trusted contact when they suspect exploitation; the measure drew support from banks, credit unions and the state securities commissioner.
Representative Bill Owens introduced House Bill 1049, a bill authorizing financial institutions to ask customers to designate a trusted contact and permitting the institution to contact that person when staff reasonably suspect exploitation or fraud.
"With this bill, if we pass it, now we've got some safe harbor," Owens said, describing the measure as a voluntary tool that helps institutions assist customers who may be vulnerable to scams without creating unintended account-access rights.
Witnesses from the Missouri Bankers Association, the Missouri Credit Union Association and the Missouri Independent Bankers Association testified in support. Emily Lewis of the Missouri Bankers Association told the committee the bill would add to the institutions’ toolbox for protecting customers. Ray Bozarth of the Missouri Credit Union Association and Andy Arnold of the Missouri Independent Bankers Association also voiced support.
Michael O’Donnell, Missouri State Securities Commissioner, said the securities industry’s trusted-contact provision has worked in practice. "I'm here to tell you that it works," he said, recounting instances where brokerage firms used a trusted contact to spot unusual payments and protect vulnerable customers.
Committee members asked operational questions: Representative Voss asked whether the bill allows multiple trusted contacts; Emily Lewis said the statute language permits designation of "one or more" contacts. Representative Murray asked whether naming a trusted contact confers account access; the sponsor and witnesses clarified it does not — the trusted contact is not given authority to transact on the account but can be contacted to check on the customer’s welfare. Members also discussed whether the trusted contact must be an adult; proponents said the bill’s reference to "adult" implies an age requirement and they would confirm statutory age language.
No opposition testimony was offered. The hearing concluded without a committee vote; proponents and state regulatory witnesses described the bill as a voluntary, liability-limiting tool for financial institutions to protect customers from scams and exploitation.
