A proposed bill might help seniors avoid money
mistakes like falling victim to financial exploitation. H.R. 2478, the
Financial Exploitation Prevention Act of 2025, seeks to help protect vulnerable
seniors by letting mutual funds, ETFs, and transfer agents temporarily pause
redemption requests when financial exploitation is suspected.
Here’s what to know about the proposed bill, what it might accomplish, and its
current status.
What the Financial Exploitation Prevention Act of 2025 proposes
The bill proposes giving financial institutions increased authority to help
prevent financial exploitation of seniors and individuals with mental or
physical disabilities.
The bill would allow financial firms and advisors to delay securities
redemptions if they believe a senior or individual is being financially
exploited. The temporary delay would give the firms time to review any
suspicious activity and notify necessary parties to help protect investors from
financial losses.
Redemption delays could initially be for up to 15 days, but delays could be
extended for another 10 days if the party determines that the senior is being
exploited. A court, state regular, or other authority could also impose longer
delays.
How the bill might be implemented
Participation in the processes the bill would allow is optional for firms. If
companies choose to participate, they would need to ask each customer to provide
an adult contact or trusted contact who could be notified if the firm suspects
fraud.
Asking customers for a trusted contact is a procedure that many banks and
brokerages already implement, but customers generally aren’t required to provide
such a contact.
The status of the bill
The bipartisan bill passed the House on June 25, 2026, by a 414-2 vote, and it
should head to the Senate for a vote next. A companion bill, S. 2840, is also
pending a vote in the Banking Committee.
While the House has passed the bill, it is not yet law and still needs Senate
approval and a presidential signature before it may go into effect. The Senate
has not announced a date during which it might vote on the bill.
Why the bill matters now
Elder fraud losses have exploded in the past few years, prompting significant
lawmaker support of the bill. According to the Federal Trade Commission’s
(FTC’s) annual report to Congress, adults age 60 and older reported scams to the
FTC that reached $2.4 billion in 2024. That’s a 26.3% increase from the $1.9
billion in scams reported in 2023, and a 300% increase over the $600 million in
scams reported in 2020.
There’s been a significant rise in the amounts lost in single scams, which is
likely driving those higher figures. Of the scams reported in 2024, $1.6
billion, or 68% of the total amount, resulted from scams that prompted individual
losses of $100,000 or more.
FBI data on senior fraud
The FBI’s data paints an even darker picture about how fraud impacts older
adults. According to a FBI Internet Crime Complaint Center 2025 report, the FBI
received more than 201,000 fraud reports from victims over age 60, amounting to
losses of more than $7.7 billion.
The FBI reports that in 2025, the average reported loss for older victims was
more than $38,000, and at least 12,400 victims reported losses of at least
$100,000.
According to the FBI, older adults make attractive targets because they have
often accumulated significant savings, and they may be motivated to engage with
strangers because they’re lonely. Phishing and spoofing scams may target older
adults, encouraging them to share personal, financial, or login credentials.
Investment schemes continue to cause significant financial loss for seniors, and
seniors reported more than $3.5 billion in losses to investment schemes in 2025.
The real cost of fraud for older adults
Unfortunately, those figures are underestimated, since most fraud is never
reported to the FTC. The FTC estimates that older adults may have lost as much
as $81.5 billion to fraud, including investment scams, in 2024.
Retirement News: Almost 80% of Americans fear a retirement age increase — here’s the real reason why
Bipartisan support for the new bill
The bill has received bipartisan support, and it’s been championed by Republican
Representative Ann Wagner and Democratic Representative Josh Gottheimer.
“My bill, the Financial Exploitation Prevention Act, allows financial
institutions, including investment companies like mutual funds, to temporarily
delay a transaction if they have a reasonable belief that the transaction is the
result of financial exploitation. This gives potentially vulnerable investors,
including our seniors, as well as those with certain disabilities, a crucial
extra layer of defense that will help preserve the hard-earned savings they have
built over decades,” said Wagner.
The bill has also received strong support from the financial industry, including
from the Investment Company Institute. “We applaud the House passage of the
bipartisan Financial Exploitation Prevention Act and the leadership of
Representatives Wagner and Gottheimer,” said Investment Company Institute
President and CEO Eric J. Pan. “ICI urges the Senate to pass this bill without
delay so seniors and other vulnerable investors can benefit from a greater level
of protection.”
Bottom line
The bill awaits a Senate vote, so at this time, it’s not certain or clear
whether it will be signed into law. However, it sheds light on the important
subject of vulnerability among seniors when it comes to prevalent financial
scams.
If you haven’t yet added a trusted contact to your retirement or investment
funds, now might be a good time to do so, since it’s a low-friction, ungated
line of defense against fraud regardless of whether the bill is voted into law.
Protecting your investments is a valuable step in keeping you on track for retirement.
Click Here For The Original Source.
