House Panel Votes to Let Banks Hold Fraudulent Checks Longer

The House Financial Services Committee on Tuesday advanced a bill that would let banks delay making funds available when they suspect a deposited check or wire transfer is fraudulent. The measure, part of a broader package of payments legislation, would amend the Expedited Funds Availability Act to replace the current requirement for near-immediate availability with a standard that regulators would define as "reasonable suspicion."

The STOP Payments Fraud Act (H.R. 9331) targets the surge in counterfeit checks, synthetic identity fraud and payment scams that supporters say have outpaced the existing funds-availability rules. Banks would be allowed longer holds for accounts with elevated fraud risk. The bill cleared committee with amendments in the nature of substitutes, making it eligible for a House floor vote but not scheduling one automatically.

The committee also advanced the Credit Access and Inclusion Act (H.R. 5402), which would let landlords, utilities, telecom providers and public housing authorities report payment histories to credit bureaus. Supporters argued that millions of consumers who pay rent and utility bills on time remain "credit invisible" because those payments do not show up in traditional credit files. The bill preserves consumer opt-out rights and prevents utilities from reporting customers as delinquent while they remain current under approved payment plans.

The most contentious debate centered on the Earned Wage Access Consumer Protection Act (H.R. 9330), sponsored by Rep. Bryan Steil (R-Wis.). The bill would create a federal framework for earned wage access providers, requiring those that charge fees to also offer a free option. It mandates disclosures, prohibits interest charges and debt collection, and specifies that compliant earned wage access products are not loans or extensions of credit under federal law.