Requires, or sanctions, as appropriate, financial institutions to take certain action when senior or vulnerable customers make certain financial transactions.

A4541

ASSEMBLY, No. 4541

STATE OF NEW JERSEY

222nd LEGISLATURE

�

INTRODUCED MARCH 10, 2026

Sponsored by:

Assemblywoman� CAROL A. MURPHY

District 7 (Burlington)

Assemblyman� DAN HUTCHISON

District 4 (Atlantic, Camden and Gloucester)

SYNOPSIS

���� Requires, or sanctions, as appropriate, financial
institutions to take certain action when senior or vulnerable customers make
certain financial transactions.

CURRENT VERSION OF TEXT

���� As introduced.

��

An Act

concerning certain financial transactions by vulnerable
or senior customers and amending P.L.1998, c.121.

����
Be It
Enacted
by the Senate and General Assembly of
the State of New Jersey:

���� 1.��� The Legislature finds
and declares that:

���� a.���� Malevolent actors use
sophisticated techniques to take advantage of senior and vulnerable
individuals, with the intent of stealing the hard-earned assets of these
individuals.

���� b.��� Senior and vulnerable
customers have suffered extreme financial loss upon completing financial
transactions that turn out to be scams.

���� c.���� Under current laws,
banks and other financial institutions may be hesitant to take action in the
event of an unusual or suspicious transaction.

���� d.��� This act ensures that
financial institutions may delay financial transactions in order to review and
refer these transactions to appropriate authorities and that employees of
financial institutions have adequate training to identify suspicious transactions.

���� 2.��� Section 2 of P.L.1998,
c.121 (C.17:16T-2) is amended to read as follows:

���� 2.��� As used in this act:

���� "Account" means a
deposit or fiduciary account maintained with a financial institution in the
senior or vulnerable customer's name.

����
�Department� means the
Department of Banking and Insurance.

���� "Community setting"
means a private residence or any noninstitutional setting in which a person may
reside alone or with others, but shall not include residential health care
facilities, rooming houses or boarding homes or any other facility or living
arrangement subject to licensure by, operated by, or under contract with, a
State department or agency.

���� "County adult protective
services provider" means a county Board of Social Services or other public
or nonprofit agency with experience as a New Jersey provider of protective
services for adults, designated by the county and approved by the Commissioner
of Human Services pursuant to the "Adult Protective Services Act,"
P.L.1993, c.249 (C.52:27D-406 et seq.).

���� "Financial
institution" means a state or federally chartered bank, savings bank,
savings and loan association or credit union.

���� "Financial record"
means an original of, a copy of, or information known to have been derived
from, any record held by a financial institution pertaining to a senior or
vulnerable customer's account or relationship with the financial institution.���

���� "Law enforcement
agency" means a law enforcement agency of the State or of a local
government unit.

����
�Qualified individual� means
any person employed by a financial institution and who is authorized or
responsible for conducting transfers and other financial transactions as part
of the employee�s duties, or who is employed by a financial institution and who
is authorized or responsible as a supervisor or manager of any employee
conducting transfers or financial transactions as part of the employee�s
duties.

���� "Senior customer"
means a natural person, who, to the financial institution acting in good faith,
appears to be at least 60 years of age, who utilized or is utilizing any
service of a financial institution, or for whom a financial institution is
acting or has acted as a fiduciary, in relation to an account maintained in the
person's name.

���� "Vulnerable
customer" means a natural person, who is at least 18 years of age, resides
in a community setting, and, to a financial institution acting in good faith,
appears to have a physical or mental illness, disability or deficiency, or lacks
a sufficient understanding of, and the capacity to make, communicate or carry
out decisions concerning, the management of the customer's� savings or
resources, who utilized or is utilizing any service of a financial institution,
or for whom a financial institution is acting or has acted as a fiduciary, in
relation to an account maintained in the person's name.

(P.L.1998, c.121, s.2)

���� 3.��� Section 3 of P.L.1998,
c.121 (C.17:16T-3) is amended to read as follows:

���� 3.���
a.
�Notwithstanding
any other law, regulation or common law to the contrary, a financial
institution
[
may
]

shall

release the financial records regarding a customer's account to
[
a law
enforcement agency,
]

a county adult protective services provider
[
,
or both
]

if:

����
[
a.
]

(1)
A vulnerable customer
or a senior customer has a beneficial interest in the account either wholly or
in part; and

����
[
b.
]
(2)
The financial
institution suspects that illegal activity is, or will be, taking place which
involves the account including, but not limited to, defrauding any
vulnerable or senior customer
who has a beneficial
interest in the account.

����
b.��� A county adult
protective services provider receiving financial records from a financial
institution pursuant to subsection a. of this section may release the records
to a law enforcement agency, if deemed necessary.

����
c.���� (1)������� A
financial institution may delay a transaction in connection with, or a
disbursement from, an account of a vulnerable or senior customer or an account
on which a vulnerable or senior customer is a beneficiary if:

����
(a)�� a qualified
individual reasonably believes, after initiating an internal review of the
requested transaction or disbursement and the suspected financial exploitation,
that the requested transaction or disbursement may result in financial
exploitation of a vulnerable or senior customer; and

����
(b)�� the financial
institution:

����
(i)��� immediately, but in
no event more than two business days after the date on which the transaction or
disbursement was first delayed, provides written notification of the delay and
the reason for the delay to all parties authorized to transact business on the
account, unless a party is reasonably believed to have engaged in suspected or
attempted financial exploitation of the vulnerable or senior customer;

����
(ii)�� immediately, but in
no event more than two business days after the date on which the transaction or
disbursement was first delayed, notifies the department, and the applicable
county adult protective services provider; and

����
(iii)� continues the
internal review of the suspected or attempted financial exploitation of the
vulnerable or senior customer, as necessary, and provides updates to the
department, or the applicable county adult protective services provider upon
request, but no later than seven business days after the completion of the
review.

����
(2) Any delay of a
transaction or disbursement as authorized by this section shall expire upon the
sooner of:

����
(a)�� a determination by
the financial institution that the transaction or disbursement will not result
in financial exploitation of the vulnerable or senior customer; or

����
(b)�� 15 business days
after the date on which the financial institution first delayed the transaction
or disbursement of the funds, unless either the department, or the applicable
county adult protective services provider requests that the financial institution
extend the delay, in which case the delay shall expire no more than 25 business
days after the date on which the financial institution first delayed the
transaction or disbursement of the funds, unless otherwise terminated or
further extended by the department or an order of a court of competent
jurisdiction.

����
(3)�� A court of competent
jurisdiction may enter an order extending the delay of the transaction or
disbursement of funds or may order other protective relief based on the
petition of the department, the applicable county adult protective services
provider, or financial institution that initiated the delay under this section,
or other interested party.

����
(4)�� A financial
institution that, in good faith and exercising reasonable care, acts in
compliance with this section shall be immune from any administrative or civil
liability that might otherwise arise from a delay in a transaction or
disbursement in accordance with this section.

����
(5)�� Notwithstanding any
provision of law to the contrary, the department or the applicable county adult
services provider may disclose to any notifying financial institution
reasonable information regarding the general status or final disposition of any
investigation that arose from a report made by the qualified person in connection
with an extension under this section or reasonable efforts to protect a
vulnerable or senior customer
from financial
exploitation or other abuse.

����
d.��� (1) Commencing no
later than 45 days following passage of P.L.��� , c.��� (C.������� ) (pending
before the Legislature as this bill), financial institutions shall provide
training concerning the financial exploitation of vulnerable or senior customers
to their employees, as appropriate, and shall provide this training to new
employees within the first three months of employment.

����
(2)�� The training shall
include recognition of indicators of financial exploitation of a vulnerable or
senior customer; the manner in which employees may report suspected financial
exploitation to the appropriate authority; and steps employees may take to prevent
suspected financial exploitation of a vulnerable or senior customer as
authorized by law or agreement between the financial institution and its
customers. The department shall develop standardized training that the
financial institutions may offer, or the financial institutions may develop
their own training.

(cf: P.L.1998, c.121, s.3)

���� 4.��� This act shall take
effect immediately.

STATEMENT

����� This bill amends existing law to require financial
institutions to release financial records regarding a customer�s account to a
county adult protective services provider when suspecting fraud of a vulnerable
or senior customer.� Under the bill, the adult protective services provider is
then authorized to release the same records to a law enforcement agency, if
deemed necessary.

����� Under the existing law, a financial institution is
authorized, but not required, to release financial records regarding a
customer's account to a law enforcement agency,

a county adult
protective services provider, or both under the same circumstances.� As such,
this bill mandates financial institutions to release those records and provides
that adult protective services is the first point of contact.

���� As defined under the existing law, a �senior customer�
means a natural person, who, to the financial institution acting in good faith,
appears to be at least 60 years of age, who utilized or is utilizing any
service of a financial institution, or for whom a financial institution is
acting or has acted as a fiduciary, in relation to an account maintained in the
person's name.� A �vulnerable customer� means a natural person, who is at least
18 years of age, resides in a community setting, and, to a financial institution
acting in good faith, appears to have a physical or mental illness, disability
or deficiency, or lacks a sufficient understanding of, and the capacity to
make, communicate or carry out decisions concerning, the management of the
customer's� savings or resources, who utilized or is utilizing any service of a
financial institution, or for whom a financial institution is acting or has
acted as a fiduciary, in relation to an account maintained in the person's
name.

���� The bill authorizes financial
institutions, including banks and credit unions, to delay financial
transactions of certain vulnerable and senior customers under suspicious
circumstances for the protection of the customer.� The bill would provide
financial institutions with immunity for certain actions taken in good faith.

���� The bill provides for the
training of employees of financial institutions to recognize signs of financial
exploitation of vulnerable and senior customers, as well as for how to report
suspected exploitation.