Ohio committee holds first hearing on bill to impose fee on some wire transfers to fund law enforcement

The House Financial Institutions Committee on Tuesday held the first hearing on House Bill 149, a proposal to impose a fee on certain wire transfers and direct the revenue to local law enforcement and drug task forces. The committee approved minutes from its June 4 meeting before hearing sponsor testimony; no vote was taken on the bill.

Sponsors told the committee the measure is aimed at transfers used for criminal activity and said proceeds would support local policing. In sponsor testimony, members cited data on remittances, noting that in 2022 Rice University found roughly $60 billion entered Mexico via wire transfers and that remittances account for roughly 24% of El Salvador’s GDP, 23% of Honduras’s and 14% of Guatemala’s.

Supporters described the proposal as a tool to capture funds they characterized as “dirty money” moving out of the country and to create a new revenue stream for enforcement. They pointed to a similar program in Oklahoma, where sponsors said proceeds have funded task forces for more than a decade.

Opponents and committee members pressed sponsors on constitutional and practical risks. Ranking Member Russo questioned whether the bill’s focus on wire transfers risks being overbroad or running into constitutional scrutiny on interstate and foreign commerce. A member cited a prior version of the bill that drew opposition from the Money Services Business Association and warned of potential court challenges.

Committee members also raised implementation questions: how the bill would differ from federal measures such as the Bank Secrecy Act and anti–money laundering requirements; how remittance companies would identify and report covered transfers; and what metrics would show the law’s effectiveness. A member quoted a Government Accountability Office (GAO) finding from Oklahoma indicating that such fees did not reduce formal wire transfers and appeared to encourage growth in informal remittance networks.

Under the version discussed, companies that provide remittance services would report destination data quarterly and remit collected fees to the state. Sponsors said the bill includes a refundable tax credit to return fees to senders who can document legitimate transfers; sponsors described the credit as refundable and said there is a process for claimants to seek reimbursement. Committee discussion referenced a 3% fee example, a stated cap on eligible refundable amounts of $10,000 per transfer in examples offered during questioning, and a 0.75% administrative credit available to remittance companies that remit on time.

Members repeatedly flagged potential burdens on low-income senders, military families and customers who may not learn about or be able to wait for a tax refund, and asked whether exemptions or reduced rates might be warranted. Sponsors offered to continue discussions and to provide additional information and reports to the committee, including materials about the Oklahoma experience and any GAO analysis.

The committee concluded the first hearing without taking formal action on House Bill 149. Earlier in the session the committee approved the June 4 minutes by unanimous consent.

What’s next: sponsors said they will provide supplemental materials requested by members; no committee vote date was set during the hearing.