Trial Engrossment of Amendment A05381 to House Bill 2064 P.N. 3137, Regular Session 2023-2024

A05381

THE GENERAL ASSEMBLY OF PENNSYLVANIA

HOUSE BILL

No.

2064

Session of

2024

INTRODUCED BY HOGAN, LABS, MARCELL, STAATS, TOMLINSON, JOZWIAK,

MOUL, HEFFLEY, GILLEN, SCHEUREN, GROVE, GREEN, McNEILL,

MULLINS AND MENTZER, FEBRUARY 27, 2024

AS REPORTED FROM COMMITTEE ON COMMERCE, HOUSE OF

REPRESENTATIVES, AS AMENDED, MAY 21, 2024

AN ACT

Amending the act of November 6, 1987 (P.L.381, No.79), entitled

"An act relating to the protection of the abused, neglected,

exploited or abandoned elderly; establishing a uniform

Statewide reporting and investigative system for suspected

abuse, neglect, exploitation or abandonment of the elderly;

providing protective services; providing for funding; and

making repeals," providing for financial institutions and

fiduciaries.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1. The act of November 6, 1987 (P.L.381, No.79),

known as the Older Adults Protective Services Act, is amended by

adding a chapter to read:

CHAPTER 6

FINANCIAL INSTITUTIONS AND FIDUCIARIES

Section 601. Definitions.

The following words and phrases when used in this chapter

shall have the meanings given to them in this section unless the

context clearly indicates otherwise:

"A person reasonably associated with the older adult." The

term includes:

(1) an authorized contact provided by an older adult to

a financial institution;

(2) a fiduciary authorized to manage some or all of the

financial affairs of the older adult;

(3) a co-owner, additional authorized signatory or

beneficiary on an older adult's account;

(4) an attorney or financial professional known to

represent or have represented, or to assist in the management

of the financial affairs of the older adult;

(5) a parent, spouse, adult child, sibling or other

known family member or close associate of an older adult; or

(6) any other person in a position of trust with respect

to the older adult as provided by 18 Pa.C.S. § 3922.1(f)

(relating to financial exploitation of an older adult or

care-dependent person).

"Designated representative of a financial institution." An

individual provided immunity from suit for disclosing suspected

financial exploitation by 12 U.S.C. § 3423 (relating to immunity

from suit for disclosure of financial exploitation of senior

citizens).

"Fiduciary." A guardian, custodian, trustee, agent, personal

representative or other person authorized or required to act on

behalf of an older adult.

"Designated representative of a financial institution." An

individual provided immunity from suit for disclosing suspected

financial exploitation by 12 U.S.C. § 3423 (relating to immunity

from suit for disclosure of financial exploitation of senior

citizens) who is designated by a financial institution as the

individual responsible for providing information to an area

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agency on aging and a law enforcement agency or the department.

"Financial exploitation." As defined in 18 Pa.C.S. § 3922.1.

"Financial institution." Any person defined as a "financial

institution" under 31 CFR Subt. B Ch. X (relating to Financial

Crimes Enforcement Network, Department of the Treasury) that is

required to file suspicious activity reports.

"Financial institution." A covered financial institution as

defined in 12 U.S.C. § 3423(a)(1)(D).

"Financial institution employee." An employee of a financial

institution that has either:

(1) direct contact with an older adult; or

(2) access to or direct knowledge of an older adult's

financial records or accounts with the financial institution.

"Law enforcement agency." The Office of Attorney General, a

district attorney's office or an agency that employs a law

enforcement officer.

"Law enforcement officer." A member of the Pennsylvania

State Police, an individual employed as a police officer who

holds a current certificate under 53 Pa.C.S. Ch. 21 Subch. D

(relating to municipal police education and training), a sheriff

or a deputy sheriff.

Section 602. Voluntary reporting of financial exploitation.

Duties of financial institutions.

(a) Reporting.--Notwithstanding any law limiting or

prohibiting disclosure, a fiduciary or designated representative

of a financial institution having other provision of law, if a

financial institution employee has reasonable cause to believe

that financial exploitation of an older adult may have occurred,

may have been attempted or is being attempted, may a designated

representative of the financial institution shall promptly, but

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not later than five business days, report such information to

the agency which is the local provider of protective services,

or may and shall report the information to a law enforcement

agency or the department. A report made to an agency under this

subsection shall provide:

(1) the name, age and address of the older adult;

(2) the name and address, if known, of the older adult's

guardian or next of kin;

(3) the name and address of the financial institution or

fiduciary and contact information for the individual

submitting the report;

(4) the nature of the suspected financial exploitation

of the older adult; and

(5) any specific comments, observations or other

information directly related to the alleged incident, the

older adult and suspected perpetrator of the financial

exploitation a THE financial institution or fiduciary

determines is needed to facilitate investigation of the

report.

(b) Assistance by persons reasonably associated with an

older adult.--At the same time a report is made under subsection

(a) regarding the older adult, notwithstanding any law limiting

or prohibiting disclosure, the fiduciary or designated

representative may provide information regarding the report to a

person reasonably associated with the older adult sufficient to

enable the person to consult with or assist the older adult in

avoiding or remedying the suspected financial exploitation, or

exercise any fiduciary powers it possesses to protect the older

adult, unless the financial institution has reason to believe

the person is knowingly engaged in or facilitating the financial

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exploitation of the older adult.

section 304:

(1) A report authorized by this section may include, or

may be subsequently supplemented by, records of the older

adult the financial institution or fiduciary believes are

needed to provide protective services to the older adult.

(2) If records needed to determine if an older adult

subject to a report as authorized by this section are

provided by a financial institution or fiduciary as

authorized by paragraph (1), and the older adult, or a

fiduciary acting on behalf of the older adult, does not

provide consent to the agency to access such records, the

agency may issue an order, subject to 2 Pa.C.S. Chs. 5 Subch.

A (relating to practice and procedure of Commonwealth

agencies) and 7 Subch. A (relating to judicial review of

Commonwealth agency action), directing the production of such

records that relate to the financial transactions of the

older adult for a period of time up to 60 days prior to the

date of the report and the first reported incident of actual

or suspected financial exploitation. Other records shall only

be available to the extent provided by section 304. The

following shall apply:

(1) If a financial institution employee has reasonable

cause to believe that financial exploitation of an older

adult may have occurred, may have been attempted or is being

attempted, that financial institution employee shall

immediately follow the financial institution's compliance

policies, programs, plans and procedures to report the

suspected financial exploitation to the designated

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representative of the financial institution. A financial

institution shall comply with all Federal and State laws

governing the reporting of older adult financial exploitation

and sharing of relevant records with the area agency on

aging.

(2) A report made to an agency under this subsection

shall provide:

(i) the name, age and address of the older adult;

(ii) the name and address, if known, of the older

adult's guardian or next of kin;

(iii) the name and address of the financial

institution and contact information for the individual

submitting the report;

(iv) the nature of the suspected financial

exploitation of the older adult; and

(v) any specific comments, observations or other

information directly related to the alleged incident, the

older adult and suspected perpetrator of the financial

exploitation the financial institution determines is

needed to facilitate investigation of the report.

(b) Hold on proposed transactions.--If a financial

institution employee has reasonable cause to believe that

financial exploitation of an older adult may have occurred, may

have been attempted or is being attempted, the financial

institution may place a hold on a proposed transaction for a

period of up to seven business days as necessary to determine

the legitimacy of the transaction. If a financial institution

places a hold on a proposed transaction, the financial

institution must file a report under subsection (a) no later

than the next business day. A financial institution may hold a

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proposed transaction for an additional 15 business days at the

request of an area agency on aging, a law enforcement agency or

a legal representative of the older adult or if the financial

institution has not received a response from an area agency on

aging, a law enforcement official or a legal representative of

the older adult. A request by an area agency on aging, a law

enforcement agency or a legal representative of an older adult

to hold or authorize a transaction shall require cause and be

documented in writing.

law, if a financial institution places a hold on a proposed

transaction to protect an older adult from financial

exploitation, a designated representative of the financial

institution shall have the following duties:

(1) Within one business day, notify the older adult and

each person authorized to transact business on the account,

except for a person reasonably believed to have engaged in

suspected or attempted financial exploitation of the older

adult. The notification under this paragraph shall:

(i) state the financial institution has temporarily

blocked the disbursement of money or delayed the

execution of transactions as authorized by this section

to protect the older adult from financial exploitation;

(ii) provide the name of the financial institution

and the name and telephone number of a contact person

representing the financial institution; and

(iii) identify the account or transaction to which

the notification applies.

(2) Within five business days, notify each person that

has been authorized by the older adult to receive

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notifications regarding account activity, except for a person

reasonably believed to have engaged in suspected or attempted

financial exploitation of the older adult. The notification

under this paragraph shall include the information specified

under paragraph (1).

(d) Assistance by persons reasonably associated with older

adult.--Notwithstanding any other provision of law limiting or

prohibiting disclosure, a designated representative of a

financial institution may provide information to a person

reasonably associated with the older adult sufficient to enable

the person to consult with or assist the older adult in avoiding

or remedying suspected financial exploitation or to enable the

person to exercise the person's authority to protect the older

adult, unless the financial institution has reason to believe

the person is knowingly engaged in or facilitating the financial

exploitation of the older adult. Except when contacting an

authorized contact provided by an older adult to a financial

institution, a fiduciary authorized to manage some or all of the

financial affairs of the older adult or a co-owner, additional

authorized signatory or other person authorized to transact

business on the older adult's account, a designated

representative of a financial institution:

(1) may disclose only that there is reasonable cause to

suspect that the older adult may be a victim or target of

financial exploitation and the nature of the suspected

financial exploitation; and

(2) may not disclose other details or confidential

personal information regarding the financial affairs of the

older adult.

Section 603. Model training program (RESERVED) Access to

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records .

The Department of Aging and the Department of Banking and

Securities, in consultation with representatives of the

financial services industry, are authorized to jointly develop a

model training program for employees of financial institutions

and fiduciaries regarding:

(1) the identification of activities that constitute the

financial exploitation of older adults;

(2) the recognition of the signs of potential financial

exploitation of older adults;

(3) when a fiduciary or a financial institution acting

through a designated representative may report suspected

financial exploitation;

(4) to whom suspected exploitation should be reported;

(5) the information to be included in a report; and

(6) the applicable laws, rules and regulations that must

be followed while reporting suspected financial exploitation.

Section 604. Voluntary refusal of disbursements and

transactions.

(a) Reasonable belief.--If a designated representative or

other employee of a financial institution or a fiduciary

reasonably believes, after initiating an internal review of a

disbursement or transaction, that financial exploitation of an

older adult may have occurred, may have been attempted or is

being attempted, the financial institution or fiduciary may

refuse to disburse money, or engage in a transaction, to prevent

financial exploitation of an older adult with respect to:

(1) an account of the older adult;

(2) an account on which the older adult is a

beneficiary, including a trust or guardianship account; and

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(3) an account of a person suspected of perpetrating

financial exploitation of an older adult.

(b) Request by area agency on aging or law enforcement

agency.--In addition to the authorization provided under

subsection (a), a financial institution or fiduciary may refuse

to disburse money or engage in a transaction with respect to the

accounts designated in subsection (a) if an area agency on aging

or law enforcement official requests the financial institution

or fiduciary to do so or provides information to the financial

institution or fiduciary demonstrating that it is reasonable to

believe that financial exploitation of an older adult may have

occurred, may have been attempted or is being attempted.

required to refuse to disburse money or engage in a transaction

as authorized under subsection (a) or (b), but may use its sole

discretion to determine whether to refuse to disburse money

based on the information available to the financial institution

or fiduciary.

(d) Duties.--Except as provided under Federal or State law,

if a financial institution or fiduciary refuses to disburse

money or engage in a transaction as authorized by this section

to protect an older adult, the designated representative of the

financial institution or the fiduciary shall:

(1) make an immediate oral report and file a written

report containing the information required for a voluntary

report under section 602(a) within two business days;

(2) notify the older adult, and if requested provide

additional information, in the manner provided for

notification by an agency under section 308(a); and

(3) within two business days, make a reasonable effort

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to notify, orally or in writing, each person authorized to

transact business on the account , that is a beneficiary of

the account or that has been authorized by the older adult to

receive notifications regarding account activity, except for

a person reasonably believed to have engaged in suspected or

attempted financial exploitation of the older adult or a

payable on death beneficiary designated not to be notified

prior to the death of the older adult.

(e) Notice of refused disbursement or transaction.--A

notification required by subsection (d)(3) shall be sufficient

if it:

(1) states that the financial institution or fiduciary

has temporarily blocked the disbursement of money or delayed

the execution of transactions as authorized by this section

to protect an older adult from financial exploitation;

(2) provides the name of the financial institution or

fiduciary and the name and telephone number of a contact

person representing the financial institution or fiduciary;

and

(3) identifies the account or transaction to which the

notification applies.

(f) Expiration.--Except as provided under subsection (h), a

refusal to disburse money or engage in a transaction as

authorized by this section shall expire upon the sooner of the

following:

(1) issuance of a court order directing the financial

institution or fiduciary to make the disbursement or engage

in the transaction;

(2) a determination by the financial institution or

fiduciary based on its sole review and discretion to

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authorize the disbursement or transaction; or

(3) 15 SEVEN business days after the financial

institution or fiduciary first refused to disburse the money

or engage in the transaction.

(g) Extension of expiration.--A financial institution or

fiduciary may extend the expiration date of its refusal as

provided in subsection (f)(3) by an additional 25 15 business

days if a request is made for a court order as authorized by

subsection (h) by a financial institution or fiduciary, or by

the local agency on aging, the department or a law enforcement

agency to block or extend the refused disbursement or

transaction.

(h) Order.--A court of competent jurisdiction may enter an

order blocking a disbursement or transaction, or further

delaying a disbursement or transaction, to protect an older

adult from suspected financial exploitation or order other

actions to protect the older adult.

(i) Recordkeeping.--A request of an area agency on aging or

a law enforcement official to terminate or extend a refusal to

disburse money or engage in a transaction as authorized by this

section shall be documented in writing.

Section 605. Standing of financial institutions and

fiduciaries.

(a) Initiation of proceedings.--If a financial institution

or fiduciary has a reasonable cause to believe an older adult is

subject to an imminent and substantial risk of financial

exploitation, the financial institution or fiduciary may

initiate a proceeding in a court of competent jurisdiction to:

(1) extend the period of time the disbursement of money

or transactions may be refused under section 604, or prohibit

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specific disbursements or transactions;

(2) request an order necessary to protect the accounts

or assets of an older adult, or in which the older adult has

interests;

(3) request the appointment of a conservator or guardian

of the estate of an older adult;

(4) remove the powers of a fiduciary engaged in the

financial exploitation of an older adult;

(5) modify an order issued by an area agency on aging or

the department issued under this act or other law to protect

an older adult from suspected financial exploitation; or

(6) grant other appropriate relief.

(b) Notice to area agency on aging.--Prior to initiating a

proceeding under this subsection, at least 24 hours' prior

notice must be given to the area agency on aging for the county

in which the proceeding is initiated and an offer made to

consult with the agency regarding the proceeding, unless

delaying the initiation of the proceeding will threaten an older

adult with immediate and irreparable injury pursuant to the

standards applicable for an application for special relief

before notice of a hearing under Pa.R.C.P Rule 1531 (relating to

special relief, injunctions). A copy of a petition initiating a

proceeding under this section shall be provided to the area

agency on aging for the county in which a proceeding is

initiated.

(1) The area agency on aging in the county in which a

petition is filed under this section and the department

shall have a right to intervene as a party to the

proceeding.

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(2) A financial institution or fiduciary shall have the

right to intervene as a party to a proceeding initiated by

an area agency on aging or the department under this act to

provide protective services to an older adult customer of a

financial institution or to an individual to whom a

fiduciary owns a duty of care.

Section 606. Access to reports and communications regarding

investigations.

Notwithstanding the requirements of section 304, an area

agency on aging may disclose and discuss with a financial

institution or fiduciary reports of the suspected financial

exploitation of an older adult and the results of the

investigation of such reports to the extent reasonably necessary

to facilitate the financial institution's or fiduciary's

decision under section 604 to refuse to disburse money or engage

in a transaction or to terminate or seek an extension of its

refusal to do so.

Section 607. Immunity and defenses.

(a) Immunity.--Except as provided under subsection (c), a

financial institution or fiduciary and its directors, officers,

designated representatives, employees or agents shall not be

subject to a claim for damages or other civil or criminal

liability for taking or failing to take any action authorized,

but not required by this chapter, to:

(1) identify and report financial exploitation under

section 602(a);

(2) notify a person reasonably associated with an older

adult under section 602(b);

(3) provide access to records and information under

sections 602(c)(1) and (2) and 606;

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(4) refuse to allow the disbursement of funds or a

transaction under section 604; or

(5) initiate or participate in judicial proceedings

under section 605.

(b) Additional immunities and defenses.--Notwithstanding any

other law to the contrary:

(1) The refusal by a financial institution to engage in

a transaction authorized under this chapter shall not

constitute the wrongful dishonor of an item under 13 Pa.C.S.

§ 4402 (relating to liability of bank to customer for

wrongful dishonor; time of determining insufficiency of

account).

(2) A reasonable belief that payment of a check will

facilitate the financial exploitation of an older adult shall

constitute reasonable grounds to doubt the collectability of

the item for purposes of 12 U.S.C. Chs. 41 (relating to

expedited funds availability) and 50 (relating to check

truncation) and 12 CFR Pt. 229 (relating to availability of

funds and collection of checks).

this section shall not apply to a financial institution or

fiduciary or a director, officer, designated representative,

employee or agent of a financial institution or fiduciary that

intentionally or knowingly engages in the financial exploitation

of an older adult.

Section 608. Electronic records and signatures.

Any requirements of this chapter requiring a written request,

authorization or report may be satisfied by the use of

electronic records and signatures as authorized by the act of

December 16, 1999 (P.L.971, No.69), known as the Electronic

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Transactions Act.

A financial institution shall provide, at no cost, access to

or copies of records that are relevant to the suspected

financial exploitation or attempted financial exploitation of an

older adult to an area agency on aging, a law enforcement agency

or the department, either as part of a referral or upon written

request of the area agency on aging, law enforcement agency or

department, for the purpose of performing an investigation of

the suspected financial exploitation or attempted financial

exploitation. A financial institution shall provide access to or

copies of records under this section within two business days.

Records under this section may include historical records and

records regarding the most recent transaction or transactions

that may constitute financial exploitation, not to exceed 60

calendar days prior to the first transaction that was reported

or 60 calendar days after the last transaction that was

reported. Records under this section may also include, or may be

subsequently supplemented by, records of the older adult that a

financial institution believes, upon consultation with an area

agency on aging, are needed to provide protective services to

the older adult.

Section 604. Compliance policies of financial institutions.

A financial institution shall create and implement internal

compliance policies, programs, plans and procedures to comply

with this chapter.

Section 605. Model training program.

The department, in consultation with the Department of

Banking and Securities and representatives of the financial

services industry, may jointly develop a model training program

for financial institution employees and designated

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representatives of financial institutions regarding the

identification of activities that constitute financial

exploitation of older adults.

Section 606. Enforcement.

(a) Authorization.--The Attorney General and the department

shall enforce the provisions of this chapter. The Attorney

General or the department may bring an action before a court

with competent jurisdiction to enforce the provisions of this

chapter. For a violation of this chapter that results in a

financial loss to an older adult, a court may order a financial

institution to pay a civil penalty not to exceed $10,000 per

violation to the Commonwealth. A court may order a financial

institution to restore to any person interest for losses that

result from a violation of this chapter, as follows:

(1) For a violation of section 602(a)(1), an amount not

to exceed actual damages up to $10,000.

(2) For any other violation of this act, an amount of

actual damages up to a maximum of the deposit insurance limit

applicable to the owner of an older adult's account at the

financial institution in accordance with 12 U.S.C. § 1821(a)

(relating to insurance funds).

(b) Liability.--A financial institution shall be liable to

an older adult and the older adult's joint account holders, if

any, for financial losses suffered by the older adult due to

financial exploitation up to a maximum of the deposit insurance

limit applicable to the owner of the older adult's account at

the financial institution in accordance with 12 U.S.C. §

1821(a)m (relating to insurance funds) if all of the following

conditions are met:

(1) A designated representative of the financial

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institution knew or had reasonable cause to believe that the

older adult was subject to past, current or attempted

financial exploitation.

(2) Despite the designated representative of the

financial institution knowing or having reasonable cause to

believe that the older adult was subject to past, current or

attempted financial exploitation, the designated

representative failed to hold a proposed transaction under

section 602(b).

(3) Beginning no later than 60 days of the designated

representative failing to hold a proposed transaction under

section 602(b), funds or securities worth more than $10,000

in the aggregate were transferred from the older adult's

account held by the financial institution due to financial

exploitation, over a period of 31 days or less.

(4) Within 180 days of the last transfer under paragraph

(3), the financial institution was notified in writing by the

older adult or the older adult's legally authorized

representative, an area agency on aging or a law enforcement

agency that the transfer was the result of financial

exploitation. The written notice shall contain a signed

declaration not given under oath but given under penalty of

perjury in accordance with 42 Pa.C.S. Ch. 62 (relating to

Uniform Unsworn Declarations Act).

comply with this chapter, a court shall assess damages using

either the liability specified under subsection (a) or (b), but

not both subsections (a) and (b).

(d) Class action prohibited.--Only an individual action may

be brought under this section. A class action may not be brought

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under this section.

Section 607. Immunity.

A person acting in good faith in accordance with this chapter

shall have immunity from liability solely for providing access

to records or holding a transaction that might otherwise exist.

Section 2. This act shall take effect in 60 days. as

follows:

(1) This section shall take effect immediately.

(2) The addition of section 604 of the act shall take

effect in 90 days.

(3) The remainder of this act shall take effect in 180

days.

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