Mutual funds could freeze withdrawals to stop scams targeting seniors
Officially: Financial Exploitation Prevention Act of 2025
If your mutual fund suspects someone is draining your account through fraud or pressure, they could pause the payout for up to 25 business days while they investigate. The rule applies to adults 65 and older or anyone with a mental or physical impairment, but only if the fund opts in. Funds must also ask you to name a trusted contact who can be reached if something looks wrong.
Where it stands
floor_pending · Hearing Wed, Apr 15
In 4 days. Members are taking positions right now.
- Applies to non-institutional accounts held directly with mutual funds and serviced by transfer agents — not brokerage accounts.
- Participation is voluntary. The rules only kick in if a fund and its transfer agent formally opt in by notifying the SEC.
- Participating funds must ask each account holder to name at least one adult trusted contact and explain in writing that this person may be contacted about possible exploitation.
↓ Why your message matters here
Members are still deciding how to vote — and what they hear from constituents in these final days is what tips undecided ones.
The debate
What people are saying about this bill
- Protects vulnerable investors: Supporters say the bill helps prevent financial losses from scams, which cost seniors billions each year.
- Provides a critical investigation period: The bill allows up to 25 business days to investigate suspicious withdrawals, potentially stopping fraud before it's too late.
- Encourages family involvement: By requiring a trusted contact, the bill ensures that family members can be quickly notified of suspicious activity.
- Potential liquidity issues: Critics might worry that legitimate withdrawals could be delayed, causing inconvenience for account holders.
- Implementation costs: There could be concerns about the costs for companies to implement these new procedures, even if participation is voluntary.
- Limited scope: Some may argue that the bill doesn't go far enough in addressing all forms of financial exploitation.
Where this bill is in the process
Legislative timeline
Introduced
Introduced in House
House Committee
Under House committee consideration
House Floor Vote
Voted on by House
Latest: Placed on the Union Calendar, Calendar No. 313. (11/4/2025)
Passed House
Approved by House
Senate Review
Sent to Senate for consideration
Passed Both Chambers
Approved by both House and Senate
Signed into Law
Signed by the President
For more detail