2025 ABA Survey on State Elder Financial Exploitation Laws: Balancing Protection with Autonomy for Seniors Aging in Place

The American Bankers Association (ABA) Foundation's 2025 Survey of State Elder Financial Exploitation Laws offers valuable insights into how financial institutions are navigating the complex terrain of protecting older adults from fraud.  Released in March 2025, the report highlights the role of "hold" laws, statutes that allow financial institutions to temporarily delay or hold suspicious transactions, in preventing losses that could jeopardize seniors' ability to age in place.  Amid rising elder fraud complaints, which increased 14% in 2023 with estimated losses of $61.5 billion, per the Federal Trade Commission (FTC), these findings are crucial for elder law planning.

This article summarizes the survey's key results, explains state hold laws (with a focus on Ohio and Missouri), what consumers should know, and how seniors and families can benefit from, utilize, or advocate for these protections. 

Survey Results: Banks' Use of Hold Laws and Challenges in Fraud Prevention

Conducted from September 9 to October 8, 2024, the ABA survey polled 158 U.S. banks holding 71% of industry deposits, including 53.2% with assets under $1 billion. Key findings include:

• Prevalence of Hold Laws: As of January 2025, about half of U.S. states have enacted hold laws for depository institutions, typically applying to individuals aged 60-65 or older, or those deemed vulnerable under Adult Protective Services (APS) criteria.  These laws lack a federal equivalent but often provide "safe harbor" protections from litigation for good-faith actions.

• Utilization and Effectiveness: 54.4% of respondents operate in at least one state with hold laws, and among them, 50% have used these laws to delay, refuse, or hold transactions. This allows time for investigations, contacting trusted third parties, and collaborating with authorities. Utilization frequency varies: 40.5% rarely, 23.8% a few times monthly, and higher in some cases. 43% of utilizing banks find the laws useful in preventing exploitation, though 33.3% say it's too early to tell.  Nearly 90% of banks in non-hold states believe such laws would be beneficial.

• Collaborations and Challenges: Banks extensively partner with law enforcement (91.8% report suspicious activity) and APS (93.8% report cases), but challenges include litigation risks, inconsistent state laws, under-resourced agencies, and customer unawareness.   Customer reactions to holds are often negative (45.2%), sometimes leading to account closures (16.7%), but vary by situation.

• Recommendations: Banks advocate for federal legislation for consistency, stronger safe harbors, customer education, bank-to-bank communication, and flexible hold periods (e.g., up to 30 days, as desired by 28.6%). These results emphasize the importance of hold laws as a vital tool, preventing losses like a $30,000 scam in New Hampshire, but highlight the need for improvements to address lengthy investigations and customer education.

Understanding State Hold Laws: Transaction Holds and Delayed Disbursements

State hold laws authorize financial institutions to place temporary holds on transactions or delay disbursements when exploitation is suspected, providing a window for verification without immediate fund release.  Typically lasting 3-15 business days (extendable), they include mandatory reporting to APS or law enforcement, staff training in some states, and authorization to contact trusted contacts. Safe harbors protect banks from liability if actions are in good faith. Holds may be mandatory if directed by authorities. In practice, banks use them to investigate red flags like unusual transfers, educate customers, and prevent irreversible losses.

Hold Laws in Ohio and Missouri

As of October 2025, neither Ohio nor Missouri has enacted specific transaction hold laws for financial institutions in cases of suspected elder financial exploitation, according to FTC overviews and state statute reviews.  Instead, both states focus on reporting and penalties:

• Ohio: Ohio mandates reporting suspected exploitation to the Division of Securities and county Job and Family Services under its "Reporting Elder Financial Exploitation" law, Ohio Revised Code (ORC) §1707.49.  Banks must report to APS or law enforcement, but without hold laws, they lack explicit authority to delay transactions, increasing litigation risks. Protections exist under broader elder abuse statutes (e.g., ORC § 5101.60 et seq.), with penalties for exploitation including misdemeanors to felonies.  No hold durations or extensions apply, but safe harbors for good-faith reporting are available.

• Missouri: Missouri's RSMo Section 570.145 criminalizes financial exploitation with penalties ranging from misdemeanors (under $50) to class A felonies ($75,000+), including defenses for good-faith efforts but no specific holds. Reporting is mandated to APS, with investigations for abuse, neglect, or exploitation. Note that RSMo Section 192.2455 addresses recipient inability to give consent but lacks hold provisions. Banks in Missouri use trusted contacts and law enforcement partnerships, but without holds, interventions are limited.

What Consumers Should Know About Hold Laws

Consumers, especially seniors and retirees, should understand that hold laws (in about half of states) allow banks to pause suspicious transactions for older or vulnerable adults, buying time to verify the legitimacy of the transaction. They typically require reporting to APS/law enforcement and may involve notifying trusted contacts. Safe harbors protect banks from liability, but consumers might experience temporary inconveniences. In states without them, like Ohio and Missouri, banks rely on reporting and voluntary programs, potentially leaving gaps in protection. Know your rights: Holds are protective, not punitive, and can be challenged if unwarranted.

How Consumers Can Benefit From, Utilize, or Encourage Hold Laws

Hold laws benefit consumers by preventing irreversible losses from scams, as seen in survey examples where holds saved thousands.  For aging in place, preserved savings mean continued home care funding. Moreover, holds prevent losses that may cause family disputes, punitive actions against family members due to oversight failures, or the loss of a senior's decision-making authority through guardianship or conservatorship. To utilize:

• Designate Trusted Contacts: At your bank, name a reliable person for notifications during suspicions, essential in all states. 

• Educate Yourself: Attend bank workshops or use resources from AARP's Fraud Watch Network to recognize red flags. 

• Respond Proactively: If a hold occurs, cooperate with investigations to resolve quickly.

In Ohio and Missouri, and other states without hold laws, encourage adoption by contacting legislators or banker associations to advocate for federal consistency and safe harbors.  By supporting reform, consumers can push for broader protections, ensuring safer aging in place.

To safeguard against the rising tide of financial exploitation, older consumers and their families are strongly encouraged to schedule a meeting with a bank representative to explore the voluntary programs available at their financial institution. These may include trusted contact designations, which allow banks to reach out to a pre-approved family member or advisor during suspicious activity; transaction alerts for unusual withdrawals or transfers; and enhanced monitoring tools tailored for seniors. By discussing these options in person or virtually, you can learn how to easily implement them. This includes setting up account notifications via app or email, or integrating them with elder law tools like powers of attorney, to add an extra layer of protection without compromising autonomy. This proactive step not only empowers you to customize defenses against fraud but also fosters peace of mind, ensuring your hard-earned savings support independent living and aging in place.

For personalized advice, consult an elder law attorney. Visit our "Handy Link" for Ohio reporting or explore FTC tools for nationwide alerts. 

 Stay vigilant; knowledge is your best defense.

Five Reasons Why Joint Accounts May Be a Poor Estate Plan

Many people, including seniors, view joint ownership of investment and bank accounts as a cheap and easy way to avoid probate since joint property passes automatically to the joint owner at death. Joint ownership can also be an easy way to plan for incapacity since the joint owner of accounts can pay bills and manage investments if the primary owner falls ill or suffers from dementia. These are all benefits of joint ownership, but three potential drawbacks exist as well:

Risk. Joint owners of accounts have complete access and the ability to use the funds for their own purposes. Many elder law attorneys have seen children who are caring for their parents take money in payment without first making sure the amount is accepted by all the children. In addition, the funds are available to the creditors of all joint owners and could be considered as belonging to all joint owners should they apply for public benefits or financial aid.  Many elder attorneys have seen their clients' accounts embroiled in creditor claims and nasty divorces against their clients' children. 

Inequity. If a senior has one or more children on certain accounts, but not all children, at her death some children may end up inheriting more than the others. While the senior may expect that all of the children will share equally, and sometimes they do in such circumstances, but there's no guarantee. People with several children can maintain accounts with each, but they will have to constantly work to make sure the accounts are all at the same level, and there are no guarantees that this constant attention will work, especially if funds need to be drawn down to pay for care.

The Unexpected. A system based on joint accounts can really fail if a child passes away before the parent. Then it may be necessary to seek guardianship to manage the funds or they may ultimately pass to the surviving siblings with nothing or only a small portion going to the deceased child's family. For example, a mother put her house in joint ownership with her son to avoid probate and Medicaid’s estate recovery claim. When the son died unexpectedly, the daughter-in-law was left high and dry despite having devoted the prior six years to caring for her husband's mother.

Disputes. Planning based upon individual accounts really does nothing to inform your family regarding your ultimate wishes.  Do you ultimately want to prefer one family member over another?  If the effect of planning using individual accounts results in an inequality to family members, was it intended or anticipated?  Of course, the resulting ambiguity is the cause of lawsuits, claims, disagreements, and hard feelings.  

Fraud.  Asset transfers late in life are particularly troubling, if they work to defraud your heirs and/or are not a reflection of your wishes.  A plan based upon individual assets and accounts does little to protect your family.  On the other hand, a comprehensive plan involving a trust or well-drafted will can better protect your family from late-in-life transfers by informing your family and authorities of your estate planning objectives.  

Joint accounts do work well in two situations. First, when a senior has just one child and wants everything to go to him or her, joint accounts can be a simple way to provide for succession and asset management. It has some of the risks described above, but for many clients the risks are outweighed by the convenience of joint accounts.

Second, it can be useful to put one or more children on one's checking account to pay customary bills and to have access to funds in the event of incapacity or death. Since these working accounts usually do not consist of the bulk of a client's estate, the risks listed above are relatively minor.

For the rest of a senior's assets, wills, trusts and durable powers of attorney are much better planning tools. They do not put the senior's assets at risk. They provide that the estate will be distributed as the senior wishes without constantly rejiggering account values or in the event of a child's incapacity or death. And they provide for asset management in the event of the senior's incapacity.

For more information review the previous post regarding direct transfer designations, such as Transfers on Death (TOD) and Payable on Death (POD) designations.  Joint ownership, TODs and PODs share many of the same disadvantages.   

Banks Can Report Abuse of Elderly Without Violating Privacy Laws

UC Irvine's Center of Excellence on Elder
Abuse and Neglect - committed to eliminating
 abuse of the elderly

The Federal Government has issued new guidelines aimed to help banks understand how to report suspected financial elder abuse without violating privacy laws. It was co-authored by eight federal agencies, including the FTC, SEC, FDIC, and the new Consumer Financial Protection Bureau. The privacy protection law in question is the 1999 Gramm-Leach-Bliley Act (GLBA).

As the Guidance explains, GLBA allows banks to disclose private information “to comply with…state laws that require reporting by financial institutions of suspected abuse.” It may also be released to respond to a government investigation or to respond to judicial process. The guidance was issued to reassure financial institutions that they will not run afoul of federal law by reporting suspected abuse as required under state law.

Ohio law protects the disabled and elderly from abuse, neglect, and exploitation, and requires certain professionals, including doctors, nurses, lawyers, physical therapists, social workers, law enforcement and emergency response personnel. having reasonable cause to believe that an elderly person is in need of protective services to report such information.

Ohio law does not currently require financial professionals such as tellers to report.  Ohio law does, however, protect any person that does report suspected abuse, whether or not required to report.  Any person who makes a report with reasonable cause to believe that an adult is suffering abuse, neglect or exploitation is immune from civil or criminal liability under Ohio law.

The importance of banking professionals in identifying abuse and exploitation cannot be overstated.  According to Richard Cordray, Director of the Consumer Financial Protection Bureau:

"Many older consumers are known personally by the tellers in their local banks and credit unions. These employees may be able to spot irregular transactions, abnormal account activity, or unusual behavior that signals financial abuse sooner than anyone else can. Today’s guidance makes clear that reporting suspected elder financial abuse generally is not subject to these same concerns and does not violate the Gramm-Leach-Bliley Act.

The guidance mentions repeated large withdrawals, debit transactions uncommon for an older adult, random attempts to wire large amounts and the closing of CDs or accounts despite penalties as possible signs of elder financial abuse. 

  

For more information on the new federal guidance, see here, or see the full document here.

Account Management Complicated By New Banking Rules

Every Account Holder Should Be Aware of Changes

Americans write about 40 billion paper checks each year. In addition, for the first time that number recently was eclipsed by the annual number of automated transactions involving checking accounts. Checking account transactions are such a widespread part of our lives that consumers of banking services are well advised to become acquainted with major changes affecting banking laws. Federal legislation called the Check Clearing for the 21st Century Act, or "Check 21" for short, went into effect on October 28, 2004.

Check 21 will allow financial institutions to process "substitute" checks--high-quality paper reproductions created from electronic images of both sides of an original check. In time, check processing will be faster, and this is where there will be ramifications for check writers and depositors.

While it has always been prudent to have enough money in your account to cover a check the moment you write it, who has not used the lag time in check processing to make a necessary deposit? That will soon become a riskier strategy as electronic check processing becomes more prevalent. It will also be more important than ever to keep checkbooks up to date, especially bearing in mind deductions for ATM withdrawals, bank fees, and debit-card purchases.

The risk is merely financial if you unintentionally "bounce" a check from time to time. But, if you have come to rely upon the float, and particularly if you use the float from two different accounts, you may find your problem is criminal in nature. The increased speed with which banks process checks may mean more charges of check "kiting." Check kiting is among the most common, and most dangerous, forms of check fraud foisted upon financial institutions. A kite is a form of shell game using at least two accounts at separate financial institutions. The common practice of allowing depositors to have immediate use of uncollected funds facilitates the scheme. Indeed, Regulation CC mandates early access to deposited funds. In the typical scheme, an NSF check is written by on one account and then deposited into an account at another institution. A check drawn on the second account is then used to cover the resulting overdraft on the first account. Taking advantage of the float caused by normal delays in the collection system, the wrongdoer creates fictional balances in each account and uses these balances to obtain cash advances.