Bill Would Permit Banks to Hold Funds From Suspected Fraudulent Deposits

House Financial Services Committee member Young Kim introduced the "STOP Payments Fraud Act of 2026," a bill that would let banks delay access to deposited checks and incoming wire transfers they reasonably suspect involve fraud.

The bill would amend the Expedited Funds Availability Act so that funds availability deadlines do not apply to a check, or to funds received by wire, when the receiving bank has "reasonable suspicion to believe" the item is false, unauthorized, or otherwise involves fraud. The bill would also let banks apply longer holds, for up to 60 days per occurrence. The bill would bar a bank from basing a wire-transfer fraud determination on any class of wire transfers or persons. The bill would also add exceptions to the federal law that requires banks to make deposited funds quickly available.

The measure directs the Federal Reserve Board, jointly with the Consumer Financial Protection Bureau, to write implementing rules.