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Consumer Protection Against Payment Scams: Banks Must Refund Fraudulently Induced Transfers.

This Act expands consumer protection by treating transfers initiated due to fraud (like scams) the same as unauthorized transfers. This means financial institutions will be required to reimburse customers for money lost through scams, significantly enhancing citizens' financial security. It also introduces a liability-sharing mechanism between the customer's bank and the receiving bank to incentivize better fraud prevention.
Key points
Major Change: Transfers initiated by a consumer due to fraudulent inducement are now classified as 'unauthorized or fraudulently induced electronic fund transfers,' requiring banks to issue refunds.
Reduced Consumer Liability: Consumers are protected from liability if they were fraudulently or coercively induced to provide access to their account.
Shared Liability: The financial institution holding the consumer's account and the institution that received the fraudulent transfer must evenly share the loss, promoting joint responsibility for fraud prevention.
New Definition of Error: The definition of 'error' is expanded to include mistakes or other errors made by a consumer.
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Expired
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Additional Information
Print number: 118_S_4943
Sponsor: Sen. Blumenthal, Richard [D-CT]
Process start date: 2024-08-01
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Summarized by: gemini-flash-latest
Source data: api.congress.gov
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OFFICIAL LEGAL TITLE

Protecting Consumers From Payment Scams Act

FREQUENTLY ASKED QUESTIONS

What is the official ID of this bill?

The official print number for this legislation is 118_S_4943.

Which chamber initiated this legislation?

This legislation was initiated in the Senate.

When did the legislative process begin?

The process officially started on 2024-08-01.

What are the main provisions?

Key points include:

  • Major Change: Transfers initiated by a consumer due to fraudulent inducement are now classified as 'unauthorized or fraudulently induced electronic fund transfers,' requiring banks to issue refunds.
  • Reduced Consumer Liability: Consumers are protected from liability if they were fraudulently or coercively induced to provide access to their account.
  • Shared Liability: The financial institution holding the consumer's account and the institution that received the fraudulent transfer must evenly share the loss, promoting joint responsibility for fraud prevention.
  • New Definition of Error: The definition of 'error' is expanded to include mistakes or other errors made by a consumer.
What is the specific legal status?

The current status is Expired.

Where can I read the full text of this legislation?

The full official text is available at: View full text

Who is the primary sponsor?

The primary sponsor is Sen. Blumenthal, Richard [D-CT].

What is the latest detailed status?

The latest detailed status is: Introduced in Senate

Is this summary verified?

Yes. This content was analyzed by AI and verified by the Lustra Judge System on 2025-12-26.

CATEGORIES

Economy Courts and Law