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Committee advances bill letting bank customers name a trusted contact to curb fraud
Summary
The House Commerce committee advanced House File 45, a voluntary 'trusted contact' program that lets account holders designate family or friends banks can call if fraud is suspected; the Minnesota Bankers Association testified the tool is low-cost and requires customer authorization.
Representative Perry introduced House File 45, a voluntary "trusted contact" program designed to help Minnesota banks and credit unions spot and stop financial exploitation before money is lost. The bill allows customers to designate one or more trusted contacts their bank may notify if red flags appear on an account.
Tess Rice, general counsel for the Minnesota Bankers Association, told the committee the practice is a "low-tech" fraud-prevention tool already used in some institutions and that HF 45 requires customer authorization so banks cannot contact third parties without permission. Rice said banks are losing more to fraud than to bad loans and that the program would encourage wider participation without adding immediate costs to customers.
Several committee members praised the bill as a commonsense consumer protection, noting it could speed bank responses when seniors or other vulnerable account holders are targeted. Representative Perry closed by saying Minnesota has been a leader in protections for seniors and vulnerable adults and that HF 45 would extend that protection to all account holders.
The committee voted to refer HF 45 to the General Register by voice vote. The referral means the measure will remain available for future floor or committee action but does not by itself enact a law.
