Protecting Consumers from Payment Scams: Banks Share Liability for Fraud Losses.
This Act expands consumer protection by treating transfers initiated due to fraud (where the consumer was tricked) the same as unauthorized transactions. Financial institutions will be required to reimburse consumers for funds lost in such scams. The liability for these losses will then be shared equally between the consumer's bank and the receiving bank, enhancing citizens' financial security.
Key points
Financial institutions must reimburse consumers for funds lost when they are fraudulently induced into initiating an electronic transfer.
Liability for losses resulting from these scams is shared equally between the consumer's bank and the bank that received the funds.
The burden of proof shifts to the financial institution to demonstrate that a transfer was not fraudulently induced.
Status:
Expired
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