SB369 - Revises provisions relating to financial institutions. (BDR 55-225)

S.B. 369 - *SB369* SENATE BILL NO. 369–SENATORS STONE, BUCK, HANSEN AND ELLISON MARCH 17, 2025 ____________ Referred to Committee on Commerce and Labor SUMMARY—Revises provisions relating to financial institutions. (BDR 55-225) FISCAL NOTE: Effect on Local Government: No. Effect on the State: No. ~ EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted. AN ACT relating to financial institutions; requiring certain financial institutions, credit unions, savings banks and thrift companies to take certain actions relating to the use of an emergency financial contact for certain accounts and transactions which involve an older person or vulnerable person; authorizing certain persons to temporarily delay certain financial transactions involving the suspected exploitation of an older person or vulnerable person; exempting certain persons from liability for certain actions relating to the suspected exploitation of an older person or vulnerable person; creating a civil cause of action to recover damages for certain violations of certain requirements relating to the use of an emergency financial contact which result in exploitation of an older person or vulnerable person; and providing other matters properly relating thereto. Legislative Counsel’s Digest: Existing law requires certain financial institutions, credit unions, savings banks 1 and thrift companies to: (1) provide training concerning the identification and 2 reporting of the exploitation of older persons and vulnerable persons to certain 3 directors, officers and employees who may interact with or review information of 4 an older person or vulnerable person in providing financial services; and (2) 5 designate a person to whom a director, officer or employee must report known or 6 suspected exploitation of an older person or vulnerable person. (NRS 657.220- 7 657.290, 672.767-672.779, 673.773-673.807, 677.673-677.707) Existing law 8 requires a designated reporter, under certain circumstances, to report known or 9 – 2 – - *SB369* suspected exploitation of an older person or vulnerable person to the Aging and 10 Disability Services Division of the Department of Health and Human Services, a 11 police department or sheriff’s office and any county office for protective services. 12 (NRS 657.290, 672.779, 673.807, 677.707) 13 Existing law also: (1) authorizes a designated reporter for certain financial 14 institutions to delay a requested disbursement or transaction involving an older 15 person or vulnerable person if the designated reporter knows or has reasonable 16 cause to believe that the older person or vulnerable person has been exploited; and 17 (2) sets forth procedures and requirements for the imposition of such a delay. 18 Additionally, existing law provides that a financial institution and its officers, 19 employees and designated reporters are immune from criminal, civil and 20 administrative liability for: (1) making a report concerning the known or suspected 21 exploitation of an older person or vulnerable person in good faith; (2) delaying a 22 requested disbursement or transaction involving such exploitation; and (3) taking 23 certain other actions relating to such exploitation. (NRS 657.290) Sections 20, 30 24 and 40 of this bill make those provisions similarly applicable to credit unions, 25 savings banks and thrift companies. 26 Sections 2, 12, 22 and 32 of this bill define “covered account” to mean an 27 account for which a financial institution, credit union, savings bank or thrift 28 company has actual knowledge is an account of an older person or vulnerable 29 person or to which an older person or vulnerable person is a beneficiary. Sections 30 5, 15, 25 and 35 of this bill require a financial institution, credit union, savings 31 bank and thrift company, before opening any covered account, to require the 32 prospective account holder to either complete a form designating a person to serve 33 as an emergency financial contact or complete a form declining to designate an 34 emergency financial contact. Sections 6, 16, 26 and 36 of this bill authorize the 35 account holder of a covered account that was opened in a financial institution, 36 credit union, savings bank or thrift company before October 1, 2025, to, upon 37 request of the account holder, designate an emergency financial contact. Sections 6, 38 16, 26 and 36 authorize a financial institution, credit union, savings bank or thrift 39 company to notify and provide information to account holders of covered accounts 40 that were opened before October 1, 2025, concerning the designation of an 41 emergency financial contact. 42 Sections 3, 13, 23 and 33 of this bill define “covered transaction” to mean a 43 requested disbursement from or a requested transaction involving a covered 44 account that exceeds $5,000. Sections 7, 17, 27 and 37 of this bill require a 45 financial institution, credit union, savings bank and thrift company to attempt to 46 contact a designated emergency financial contact within 24 hours after a covered 47 transaction is requested involving a covered account for which the account holder 48 has designated an emergency financial contact. Sections 7, 17, 27 and 37 prohibit 49 the entity from proceeding with the covered transaction until 24 hours after 50 attempting such contact or, if applicable, the expiration of any temporary delay, 51 whichever is later. Under sections 7, 17, 27 and 37, if a director, officer or 52 employee of such an entity, after attempting such contact, knows or suspects that 53 exploitation has occurred or is occurring, the director, officer or employee is 54 required to report the known or suspected exploitation to the designated reporter. 55 The designated reporter is required to proceed in accordance with the procedures 56 for handling other reports of known or suspected exploitation, except that, under 57 sections 10, 20, 30 and 40, the designated reporter is required, rather than 58 authorized, to temporarily delay the covered transaction. 59 Sections 10, 20, 30 and 40 provide immunity from criminal, civil and 60 administrative liability to a financial institution, credit union, savings bank and 61 thrift company for taking the actions required by sections 7, 17, 27 and 37. 62 However, if such an entity violates the provisions of sections 7, 17, 27 and 37, and 63 the violation results in the exploitation of an account holder, sections 8, 18, 28 and 64 – 3 – - *SB369* 38 of this bill authorize the account holder to bring an action against the entity, in 65 which the account holder is entitled to treble damages. 66 Sections 4, 14, 24 and 34 of this bill define “emergency financial contact.” 67 Sections 9, 19, 29 and 39 of this bill make a conforming change to apply the 68 definitions set forth in sections 2-4, 12-14, 22-24 and 32-34 to the provisions of 69 existing law requiring the identification and reporting of exploitation of older 70 persons and vulnerable persons by financial entities. 71 Existing law provides that a designated reporter for certain financial institutions 72 who delays a requested disbursement or transaction due to, or certain other persons 73 who make a report concerning, exploitation of an older person or vulnerable person 74 are not required to accept an acknowledged power of attorney under certain 75 circumstances. (NRS 162A.370) Section 41 of this bill makes those provisions 76 similarly applicable to designated reporters and certain persons who make such 77 reports for credit unions, savings banks and thrift companies. 78 THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS: Section 1. Chapter 657 of NRS is hereby amended by adding 1 thereto the provisions set forth as sections 2 to 8, inclusive, of this 2 act. 3 Sec. 2. “Covered account” means an account which a 4 financial institution has actual knowledge is: 5 1. An account of an older person or vulnerable person; or 6 2. An account to which an older person or vulnerable person 7 is a beneficiary. 8 Sec. 3. “Covered transaction” means a requested 9 disbursement from or a requested transaction involving a covered 10 account that exceeds $5,000. 11 Sec. 4. “Emergency financial contact” means a person who 12 is designated as an emergency financial contact pursuant to 13 section 5 of this act. 14 Sec. 5. 1. Except as otherwise provided in subsection 3, a 15 financial institution shall, before opening a covered account, 16 require the prospective account holder to designate an emergency 17 financial contact by completing a form that contains: 18 (a) The name, address, electronic mail address and telephone 19 number of the account holder and any joint account holder; and 20 (b) The name and telephone number of a person to serve as 21 the emergency financial contact of the account holder. 22 2. A person designated an emergency financial contact 23 pursuant to subsection 1 must be over 18 years of age. 24 3. A financial institution may open a covered account without 25 complying with the provisions of subsection 1 if the prospective 26 account holder declines to designate an emergency financial 27 contact by completing a form acknowledging the declination. 28 – 4 – - *SB369* Sec. 6. The account holder of a covered account that was 1 opened in a financial institution before October 1, 2025, may, 2 upon request of the account holder, designate an emergency 3 financial contact in the manner set forth in subsection 1 of section 4 5 of this act. A financial institution may notify and provide 5 information to account holders of covered accounts that were 6 opened before October 1, 2025, concerning the provisions of this 7 section. 8 Sec. 7. 1. If an account holder of a covered account has 9 designated an emergency financial contact pursuant to section 5 10 or 6 of this act, the financial institution: 11 (a) Shall attempt to contact the emergency financial contact 12 within 24 hours after a covered transaction is requested involving 13 the covered account of the account holder to request an opinion 14 from the emergency financial contact concerning whether the 15 covered transaction is the result of exploitation; and 16 (b) Shall not proceed with the covered transaction until the 17 later of 24 hours after the attempt to contact the emergency 18 financial contact or, if applicable, the expiration of any temporary 19 delay imposed pursuant to NRS 657.290. 20 2. If, after attempting to contact the emergency financial 21 contact pursuant to subsection 1, an officer or employee of the 22 financial institution knows or suspects that exploitation of an 23 account holder has occurred or is occurring, the officer or 24 employee shall report the known or suspected exploitation to the 25 designated reporter in accordance with NRS 657.290, who shall 26 proceed in accordance with the provisions of that section. 27 Sec. 8. 1. If a financial institution violates the provisions of 28 section 7 of this act and that violation results in the exploitation of 29 the account holder, the account holder may bring an action 30 against the financial institution. In such an action, the account 31 holder is entitled to treble damages. 32 2. In any action brought pursuant to subsection 1, the 33 plaintiff must allege in the complaint, and prove at the trial, that, 34 as of the time of the violation, the plaintiff had designated an 35 emergency financial contact in the manner set forth in subsection 36 1 of section 5 of this act. 37 Sec. 9. NRS 657.220 is hereby amended to read as follows: 38 657.220 As used in NRS 657.220 to 657.290, inclusive, and 39 sections 2 to 8, inclusive, of this act, unless the context otherwise 40 requires, the words and terms defined in NRS 657.230 to 657.270, 41 inclusive, and sections 2, 3 and 4 of this act have the meanings 42 ascribed to them in those sections. 43 – 5 – - *SB369* Sec. 10. NRS 657.290 is hereby amended to read as follows: 1 657.290 1. Each financial institution shall designate a person 2 or persons to whom an officer or employee of the financial 3 institution must report known or suspected exploitation of an older 4 person or vulnerable person. 5 2. If an officer or employee reports known or suspected 6 exploitation of an older person or vulnerable person to a designated 7 reporter and, based on such a report or based on his or her own 8 observations or knowledge, the designated reporter knows or has 9 reasonable cause to believe that an older person or vulnerable 10 person has been exploited, the designated reporter: 11 (a) Except as otherwise provided in subsection 3, shall report the 12 known or suspected exploitation of the older person or vulnerable 13 person to: 14 (1) The local office of the Aging and Disability Services 15 Division of the Department of Health and Human Services; 16 (2) A police department or sheriff’s office; 17 (3) The county’s office for protective services, if one exists 18 in the county where the suspected action occurred; or 19 (4) A toll-free telephone service designated by the Aging and 20 Disability Services Division of the Department of Health and 21 Human Services; 22 (b) Shall make such a report as soon as reasonably practicable; 23 and 24 (c) May temporarily delay a requested disbursement from, or a 25 requested transaction involving, an account of an older person or 26 vulnerable person or an account to which an older person or 27 vulnerable person is a beneficiary , except that if the disbursement 28 or transaction is a covered transaction, the designated reporter 29 shall temporarily delay the transaction. A designated reporter [:] 30 who temporarily delays a disbursement or transaction pursuant to 31 this paragraph shall: 32 (1) Not later than 2 business days after the date on which the 33 requested disbursement or transaction is delayed: 34 (I) [Provides] Provide written notification of the delay 35 and the reason for the delay to all parties authorized to transact 36 business on the account [,] and an emergency financial contact, if 37 applicable, except a party or emergency financial contact who is 38 reasonably believed to have engaged in the suspected exploitation; 39 and 40 (II) [Notifies] Notify the local office of the Aging and 41 Disability Services Division of the Department of Health and 42 Human Services a [Text truncated for display. Full text available on LegiScan.]