STOP Payments Fraud Act of 2026

Key Points

• This bill allows banks to hold money from checks or wire transfers longer if they suspect a scam. Current laws often force banks to make funds available within a day or two, which can be too fast to catch fake checks.
• If a bank has a reasonable suspicion that a check is fake or unauthorized, they can delay the deposit. They must provide you with a notice explaining the specific reasons why they are holding your money.
• The rules would also apply to wire transfers for the first time. If a bank pauses a wire transfer due to fraud concerns but fails to notify you, they are prohibited from charging you overdraft fees that result from the delay.
• The Federal Reserve and the Consumer Financial Protection Bureau will set specific rules for high-risk situations. In some cases, banks could be allowed to hold funds for up to 60 days to ensure a transaction is legitimate.
• This change aims to stop payment fraud like check washing and wire scams. By giving banks more time to verify money, the bill tries to prevent scammers from withdrawing cash before a bank realizes a payment is fraudulent.

Impact Analysis

Govbase has not yet run an impact analysis on this legislation.