Maryland’s New Bank Hold Law for Elder Fraud: What to Know
Picture the scam in motion: a caller impersonating the police convinces a 78-year-old that her accounts are compromised, that she must tell no one, and that she needs to withdraw her savings in cash today. She walks into her branch and asks for $40,000. Until now, if the teller suspected something was wrong, Maryland law required the bank to report it, but the money could still walk out the door before anyone could intervene.
That changes on October 1, 2026. The Vulnerable Adult Banking Protection Act, signed by Governor Moore on May 12, 2026 as Chapter 510 and codified at Md. Code, Fin. Inst. § 1-307, gives Maryland banks and credit unions the authority to pause or refuse a suspicious disbursement while the situation is checked out. It passed the General Assembly without a single vote against it: 133-0 in the House and 46-0 in the Senate. This article explains how the new law works, what it means if you are worried about an older family member, and what it means if a legitimate transaction of yours gets caught in the net.
What the new law does
The Act does four things. It lets a bank or credit union delay or deny a disbursement from an account when it reasonably believes the withdrawal may result in financial exploitation. It requires the institution, when it does so, to refer the matter to the authorities: Adult Protective Services, law enforcement, or a State’s Attorney. It authorizes the institution to alert a trusted contact, someone close to the account holder who can check on them. And it requires the institution to hand over relevant financial records to the investigating agency, which spares families the delays that used to slow these investigations down.
Before this law, Maryland banks had a duty to report suspected financial abuse of customers 65 and older under Fin. Inst. § 1-306, and securities firms could delay disbursements under Corps. & Ass’ns § 11-307, but ordinary bank accounts, where most retirees keep the money scammers target, had no hold mechanism. The new § 1-307 closes that gap.
Who the law protects
The hold authority applies to accounts of an “eligible adult,” defined in § 1-307(a)(2) as a Maryland resident who is either at least 65 years old or a vulnerable adult, meaning an adult who lacks the physical or mental capacity to provide for their daily needs (Fam. Law § 14-101(q)). It also covers accounts on which an eligible adult is a beneficiary, so trust accounts and similar arrangements are within reach.
Note that this 65-and-older trigger is different from the SAFE Act’s definition of an “older adult” as 68 or older. The two laws work side by side: § 1-307 is about stopping the money in real time at the bank counter, while the SAFE Act is about suing the exploiter afterward to get it back. Different tools, different thresholds.
How a hold works, step by step
The trigger. The institution must reasonably believe the requested disbursement “may result in the financial exploitation” of the eligible adult (§ 1-307(b)(1)). Exploitation is defined broadly to include wrongful taking as well as control obtained through “deception, intimidation, or undue influence,” including through the misuse of a power of attorney or guardianship.
Within 4 business days. The institution must send written notice of the reason for the delay or denial to everyone authorized to transact on the account, and must notify APS, law enforcement, or a State’s Attorney. There is one deliberate exception: notice is withheld from any party the institution suspects is the exploiter (§ 1-307(b)(2)(i)).
Up to 15 business days. The hold expires either when the institution determines the disbursement will not result in exploitation, or 15 business days after the disbursement was requested (§ 1-307(c)(1)).
Up to 25 business days, or longer by court order. APS, law enforcement, or a State’s Attorney can request an extension to 25 business days, and the institution can extend to 25 days on its own if no agency has weighed in. Beyond that, those agencies or a court can issue an order terminating or extending the delay (§ 1-307(c)(2)-(3)).
Two practical points fall out of that timeline. First, a hold is temporary by design; this is a pause button, not a freeze order, and continuing it past 25 business days requires a court or agency order. Second, the mandatory referral means a hold is never quiet. If a bank pauses a withdrawal, an investigation is starting whether or not the family asked for one.
The trusted contact: a safeguard worth setting up now
The Act lets a bank notify a “trusted contact” when it believes an account holder may be a target of exploitation, unless the bank suspects that very person is the exploiter (§ 1-307(e)). A trusted contact under § 1-307(a)(5) can be a close family member, a person authorized on the account such as an agent under a power of attorney or a guardian, someone legally responsible for the person’s finances, or simply an individual the account holder has designated with the bank.
That last category is the one to act on. Any older adult can walk into their bank and name a trusted contact today: a child, a sibling, a friend. The trusted contact gets no authority over the account and cannot move a dollar. They are purely a person the bank may call when something looks wrong, which is often the difference between a scam interrupted and a scam completed. When we prepare estate plans, naming trusted contacts at each financial institution is now on the checklist alongside beneficiary designations.
What this means if you suspect exploitation
If you are worried that a parent or other older adult is being scammed or pressured, the bank just became a more powerful ally. Raising your concern with the branch, alongside a report to Adult Protective Services, can now result in the suspicious transaction being stopped before the money leaves, not just documented after it is gone. The bank’s referral also comes with records: under § 1-307(d), the institution must give the investigating agency access to the relevant financial records, including historical transactions that show the pattern. For a walkthrough of the full response, from documentation to the SAFE Act’s treble-damages remedy, see our guide on what to do if you suspect elder financial exploitation in Maryland.
One thing the new law does not do: it does not let a family member order the bank to freeze an account. The decision to delay or deny belongs to the institution, based on its own reasonable belief, and the institution has good-faith immunity for making that call (§ 1-307(f)). What a family member can do is give the bank the information that creates the reasonable belief.
What this means if a legitimate transaction gets held
There is another side to this law that estate planning clients should think about. The same authority that stops a scammer’s wire can pause a legitimate one. A large cash gift to a grandchild, a transfer that is part of a Medicaid spend-down plan, funds moving to settlement for a home sale, or an agent under a power of attorney making a sizable but authorized transaction could all look, from a teller’s window, like the pattern the law targets. The definition of exploitation in § 1-307 specifically mentions acts “through the use of a power of attorney,” so agents should expect closer scrutiny of large disbursements after October 1.
A few habits will keep legitimate transactions moving. Tell the bank in advance about large or unusual planned transfers, ideally with the account holder present or on record consenting. Keep the power of attorney on file with the institution before it is needed, and make sure it clearly authorizes the transactions the agent will perform. And if a hold happens anyway, do not treat it as an accusation; provide the documentation, and remember the clock: the institution must resolve it or the hold expires in 15 business days unless extended. If a hold on a legitimate transaction threatens a closing date or another deadline, an attorney can communicate with the institution and the investigating agency to resolve it quickly.
How the pieces of Maryland law now fit together
With this Act in place, Maryland has a layered system. Banks must report suspected financial abuse of customers 65 and older (Fin. Inst. § 1-306) and, as of October 1, 2026, can pause the money itself (§ 1-307). Securities firms have parallel report-and-delay authority (Corps. & Ass’ns § 11-307). Adult Protective Services investigates (Fam. Law Title 14). And the SAFE Act (Est. & Trusts §§ 13-601 through 13-609) gives victims and their families a civil claim to recover what was taken, up to three times over, after the fact. Prevention, interruption, investigation, and recovery each now have a statute behind them.
Frequently Asked Questions
When does the Vulnerable Adult Banking Protection Act take effect?
October 1, 2026. It was signed into law on May 12, 2026 as Chapter 510 of the 2026 Laws of Maryland and is codified at Md. Code, Fin. Inst. § 1-307.
Can a Maryland bank freeze my elderly parent’s account?
Not the whole account, and not indefinitely. The law authorizes a delay or denial of a specific disbursement the bank reasonably believes may result in financial exploitation. The hold generally expires after 15 business days, extendable to 25, and beyond that only by agency or court order.
Who counts as an eligible adult under the new law?
A Maryland resident who is at least 65 years old, or a vulnerable adult of any age who lacks the physical or mental capacity to provide for their daily needs. Accounts on which such a person is a beneficiary are also covered.
What is a trusted contact on a bank account?
A person the account holder designates, or a close family member or fiduciary, whom the bank may notify if it believes the account holder is being targeted for exploitation. A trusted contact has no authority to transact on the account; they are a point of contact, not a co-owner.
Will the bank tell the suspected exploiter about the hold?
No. The written notice that normally goes to everyone authorized on the account is withheld from any party the institution reasonably believes is engaging in or attempting the exploitation (§ 1-307(b)(2)(i)).
Whether you want to put protections like trusted contacts and a well-drafted power of attorney in place before a problem starts, or you are dealing with suspected exploitation or a transaction hold right now, The Law Office of Maxwell White helps Maryland families navigate both sides of this new law. Call (443) 647-9009 or schedule a consultation for a confidential conversation about your situation.
This article is general information about Maryland law, not legal advice, and it should not be relied upon as a substitute for advice from a licensed attorney about your specific situation. Reading it does not create an attorney-client relationship with The Law Office of Maxwell White, LLC. Statutory details can change and their application depends on the facts of each case. Before making decisions about a transaction hold, a report, or your accounts, speak with an attorney about your circumstances.
