The House passed the Financial Exploitation Prevention Act of 2025 by a 414-2 vote on June 25, giving mutual funds and most exchange-traded funds new tools to pause withdrawals when financial exploitation of an older or disabled account holder is suspected.
The bill, designated H.R. 2478, would authorize open-end funds and their transfer agents to temporarily delay redemption requests from adults age 65 or older, or from adults with disabilities who cannot protect their own interests, if the fund company believes exploitation may be occurring.
Under the measure, an initial hold can last up to 15 days. If exploitation is confirmed, that hold can be extended by an additional 10 days, with longer delays possible if authorized by a court, a state regulator, or another applicable authority.
"Many seniors and vulnerable adults need that extra layer of defense from fraud that has become tragically common in today's world, and [this bill] is a commonsense step to protecting parents, grandparents and families in communities around our country," said Rep. Ann Wagner, R-Mo., a lead sponsor of the bill, in a statement when the House approved the measure.
The legislation does not mandate participation. Investment companies that choose to opt in would be required to ask customers to designate a trusted contact — an adult who can be notified if fraud is suspected or another qualifying situation arises. The Financial Industry Regulatory Authority already requires brokerages to make a reasonable effort to obtain a trusted contact, though investors are not obligated to provide one.
The bill also directs the Securities and Exchange Commission to deliver a report to Congress within one year, developed in consultation with other federal agencies, on regulatory and legislative steps that could further reduce financial fraud targeting vulnerable adults.
The legislation now advances to the Senate, where its path is uncertain. A companion measure, S. 2840, remains pending in the Banking Committee. A prior version of the bill cleared the House 419-0 in 2023 but expired after the Senate took no action.
The urgency behind the legislation is reflected in rising fraud figures. Scams reported to the Federal Trade Commission by adults age 60 and older reached $2.4 billion in 2024 — a 26.3% increase from $1.9 billion in 2023 and roughly 300% more than the $600 million reported in 2020, according to the FTC's annual report to Congress. Of that total, $1.6 billion, or 68%, stemmed from individual losses of $100,000 or more, driven largely by investment scams.
Because most fraud goes unreported, the FTC estimates actual losses experienced by older adults in 2024 may have been as high as $81.5 billion.
The problem extends beyond older Americans. Total fraud losses reported to the FTC across all age groups reached roughly $15.9 billion in 2025 — the highest on record and a jump of about 27% from $12.5 billion in 2024. Since 2020, reported losses have climbed nearly 430%.
Fraud experts say a manufactured sense of urgency is one of the most reliable warning signs that a scam is underway. "Whenever there's a sense of urgency … you have to pause," said Jeff Carpenter, CEO of Weokie Federal Credit Union in Oklahoma City. "If they can create a sense of urgency and get you to move the money quickly," it could be hard to get it back, Carpenter said.
Carpenter described a case in which his staff intervened when a 76-year-old woman attempted to wire $50,000 to a crypto account that scammers had convinced her to set up, telling her that her credit union account had been compromised. Staff contacted the joint account holder, alerted police, and recovered the money the next day.
Experts also flag instructions to conceal a transaction as a clear indicator of fraud. "Any time someone says, 'Don't tell anyone this,' or they're encouraging you to be secretive or asking you to make up a story … that's got to be suspect," Carpenter said.
Whether the Senate acts on the House-passed bill or advances its own companion measure will determine whether investment firms gain these new protective powers before the next congressional session begins.
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