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Financial Exploitation Prevention Act of 2025
11/18/2025, 6:53 PM
Summary of Bill HR 2478
The bill seeks to provide safeguards for vulnerable adults who may be at risk of being taken advantage of financially. By delaying the payment or satisfaction of securities, the bill aims to give authorities and financial institutions more time to investigate and prevent potential exploitation.
In addition to addressing financial exploitation, the bill also includes provisions for other purposes related to the protection of specified adults. These additional measures are intended to strengthen the overall framework for safeguarding vulnerable individuals from financial harm. Overall, Bill 119 hr 2478 represents a proactive approach to addressing the issue of financial exploitation of specified adults. By amending existing legislation and implementing new protections, the bill aims to enhance the safety and security of vulnerable individuals in the financial sector.
Congressional Summary of HR 2478
Financial Exploitation Prevention Act of 2025
This bill establishes procedures for delaying the redemption of certain securities if an investment company or agent believes that an older individual or an individual with certain impairments has been financially exploited.
Specifically, the bill allows for the delay of the redemption of a security issued by an open-end investment management company and serviced by a transfer agent if the company or agent reasonably believes the redemption involves the financial exploitation of an individual (1) age 65 or older, or (2) age 18 or older who is unable to protect his or her own interests due to a mental or physical impairment. (Open-end investment management companies offer securities in pooled investment vehicles such as mutual funds. Transfer agents facilitate certain transactions for corporations and investment companies, including dividend distribution and change of securities ownership.)
The company may initially delay the redemption for up to 15 days and, upon making a determination of exploitation, may delay the redemption an additional 10 days. A state regulator, appropriate administrative agency, or court may extend this period. In the event of delay, the company must hold the amounts related to the redemption in a demand deposit account. The bill also establishes notification requirements.
The bill requires the registered open-end investment company and transfer agent to notify the Securities and Exchange Commission (SEC) if they elect to comply with the procedures established under this bill.
Additionally, the SEC must make recommendations to address the financial exploitation of these adults.
