Committee advances Banking and Finance housekeeping bill adding elder-transaction holds, Bitcoin-ATM rules and tighter litigation-finance oversight

A committee of the Georgia Legislature advanced LC620310S, the Georgia Department of Banking and Financeannual housekeeping substitute, after members debated provisions intended to protect consumers from impersonation scams, regulate virtual-currency kiosks and tighten oversight of litigation financiers.

A department representative told the committee the bill would allow financial institutions, after training and under written policies, to place a discretionary hold of up to 15 days on a transaction when they reasonably suspect exploitation of an "eligible adult" (defined in the bill as a disabled adult or someone 65 or older). The hold can be extended another 15 days if the investigation continues. "This billwould allow the department to work with banks to make sure there's training in place where our frontline people in the financial services industry would be able to help identify and stop some of that abusive behavior," the presenter said.

Amy Patterson, the department's attorney, clarified that the holds are discretionary and that the bill as drafted does not create liability for a financial institution for placing or declining to place a hold. "The holds are discretionary on the part of the financial institution," Patterson said, adding that the rule is meant to be accompanied by training and internal policies so tellers can spot unusual transactions.

Members pressed for detail on how a "trusted contact" would interact with existing legal arrangements such as powers of attorney. Patterson said the trusted contact is separate from power-of-attorney authority or a joint account signer and is intended solely as an outreach and investigative contact a financial institution may call to help determine whether a transaction is legitimate.

The substitute also would regulate virtual-currency kiosks (often called Bitcoin ATMs), requiring annual registration, disclosures that transactions are irreversible and may be used to defraud customers, limits on fees and data collection on kiosk locations and owners. The department said it estimates roughly 20 licensees operate approximately 1,300 kiosks in Georgia based on publicly available information and industry contacts. The bill would cap operator fees at 18% of the transaction and set transaction thresholds for new and established customers; presenters described a $10,000 aggregate daily limit for established accounts and mandatory full refunds for new customers who report fraud to law enforcement and the operator within five days.

"These virtual currency kiosksare, by anybody's definition, criminal ATMs," the presenter said, arguing the consumer disclosures and registration will give consumers and law enforcement more information and give the department enforcement tools.

On litigation financing, the substitute would move to annual registration, expand the definition of covered financial institutions to better align with other non-depository industries, allow the department access to conviction histories for owners and senior officers and give the department authority to issue cease-and-desist orders against unlicensed operators. The presenter said these changes were intended to close gaps in the current law and provide "teeth" to enforcement.

Several members praised the bill's consumer-protection aims but urged stronger uptake and asked for follow-up reporting on whether banks adopt optional transaction-hold practices. One member asked the department to consider ways to accelerate outreach and training so community banks and credit unions can implement holds more quickly.

After brief additional discussion, a motion to pass the substitute was made and seconded; the committee approved it by voice vote and the meeting was adjourned. The measure will move to the next legislative step in the process, with committee members seeking additional implementation details and uptake data going forward.