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Committee signals support to draft bill allowing banks and credit unions to pause suspicious transactions
Summary
Department of Financial Regulation recommended that banks and credit unions be given discretion to place temporary holds on suspicious transactions to investigate potential fraud. The committee agreed to draft committee bill language to consider liability protections, hold duration (15–30 days suggested), trusted‑contact use, and training requirements.
Joe Valente, director of policy at the Department of Financial Regulation, told the committee that 26 states have laws enabling financial institutions to pause suspicious transactions and investigate potential fraud.
“Our recommendation is that banks and credit unions should have the general discretion to place a pause on a potentially suspicious transaction, and they should have some degree of liability protection…
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