I 
118TH CONGRESS 
2D SESSION 
H. R. 9303 
To amend the Electronic Fund Transfer Act to treat fraudulently induced 
electronic fund transfers in the same manner as unauthorized electronic 
fund transfers, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
AUGUST 2, 2024 
Ms. WATERS introduced the following bill; which was referred to the 
Committee on Financial Services 
A BILL 
To amend the Electronic Fund Transfer Act to treat fraudu-
lently induced electronic fund transfers in the same man-
ner as unauthorized electronic fund transfers, and for 
other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Protecting Consumers 
From Payment Scams Act’’. 
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SEC. 2. TREATMENT OF FRAUDULENTLY INDUCED ELEC-
TRONIC FUND TRANSFERS. 
(a) DEFINITIONS.—Section 903 of the Electronic 
Fund Transfer Act (15 U.S.C. 1693a) is amended— 
(1) in paragraph (7)— 
(A) by striking subparagraphs (B) and 
(E); 
(B) by redesignating subparagraphs (C) 
and (D) as subparagraphs (B) and (C), respec-
tively; 
(C) in subparagraph (B), as so redesig-
nated, by adding ‘‘or’’ at the end; and 
(D) in subparagraph (C), as so redesig-
nated, by striking ‘‘or’’ at the end; 
(2) by striking paragraph (9) and inserting the 
following: 
‘‘(9) the term ‘financial institution’ means— 
‘‘(A) a State or National bank, a State or 
Federal savings and loan association, a mutual 
savings bank, a State or Federal credit union, 
or any other person who, directly or indirectly, 
holds an account belonging to a consumer; or 
‘‘(B) any person that— 
‘‘(i) issues an accepted card or other 
means of access or provides other means to 
facilitate an electronic fund transfer; and 
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‘‘(ii) agrees, directly or indirectly, 
with a consumer to provide electronic fund 
transfer services;’’; and 
(3) by striking paragraph (12) and inserting 
the following: 
‘‘(12) the term ‘unauthorized or fraudulently 
induced electronic fund transfer’— 
‘‘(A) means an electronic fund transfer 
from a consumer’s account initiated by— 
‘‘(i) a person other than the consumer 
without actual authority to initiate such 
transfer; or 
‘‘(ii) the consumer, if the consumer’s 
authorization or initiation of the electronic 
fund transfer was fraudulently induced; 
and 
‘‘(B) does not include any electronic fund 
transfer— 
‘‘(i) initiated by a natural person 
other than the consumer who was fur-
nished with the card, code, or other means 
of access to such consumer’s account by 
such consumer, unless— 
‘‘(I) the consumer has notified 
the financial institution involved that 
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transfers by such other person are no 
longer authorized; or 
‘‘(II) the consumer was fraudu-
lently or coercively induced to furnish 
the card, code, or other means of ac-
cess; 
‘‘(ii) initiated by a consumer who has 
fraudulent intent, or anyone acting in con-
cert with such a consumer; or 
‘‘(iii) which constitutes an error com-
mitted by a financial institution.’’. 
(b) DEFINITION OF ERROR.—Section 908(f) of the 
Electronic Fund Transfer Act (15 U.S.C. 1693f(f)) is 
amended— 
(1) in paragraph (2), by inserting ‘‘, including 
a mistake or other error made by a consumer’’ be-
fore the semicolon; 
(2) by redesignating paragraphs (6) and (7) as 
paragraphs (8) and (9), respectively; and 
(3) by inserting after paragraph (5) the fol-
lowing: 
‘‘(6) the consumer’s inability to access funds in 
a frozen, closed, or otherwise inaccessible account, 
except as required by a court order or law enforce-
ment or unless the financial institution determines 
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that the consumer obtained the funds through un-
lawful or fraudulent means; 
‘‘(7) a reflection on a periodic statement of 
goods or services not accepted by the consumer or 
the designee of the consumer or not delivered to the 
consumer or the designee of the consumer;’’. 
(c) CONSUMER LIABILITY FOR UNAUTHORIZED OR 
FRAUDULENTLY INDUCED TRANSFERS.—Section 909 of 
the Electronic Fund Transfer Act (15 U.S.C. 1693g) is 
amended— 
(1) in the heading, by striking ‘‘unauthor-
ized transfers’’ and inserting ‘‘unauthorized 
or fraudulently induced electronic fund 
transfers’’; 
(2) by striking ‘‘unauthorized electronic fund 
transfer’’ each place such term appears and insert-
ing ‘‘unauthorized or fraudulently induced electronic 
fund transfer’’; 
(3) by striking ‘‘unauthorized electronic fund 
transfers’’ each place such term appears and insert-
ing ‘‘unauthorized or fraudulently induced electronic 
fund transfers’’; and 
(4) in subsection (a)— 
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(A) by striking ‘‘unauthorized transfer’’ 
and inserting ‘‘unauthorized or fraudulently in-
duced electronic fund transfer’’; and 
(B) by inserting ‘‘fraudulently induced 
transfer or’’ before ‘‘loss or theft’’ each place 
such term appears; 
(5) in subsection (b)— 
(A) by striking ‘‘financial institution to 
show that’’ and inserting ‘‘financial institu-
tion— 
‘‘(1) to show that’’; 
(B) by striking ‘‘was authorized or, if the 
electronic fund transfer was unauthorized, then 
the burden of proof is upon the financial insti-
tution’’ and inserting ‘‘was authorized or was 
not fraudulently induced, as applicable; or 
‘‘(2) if the showing under paragraph (1) is not 
made,’’; and 
(C) by striking ‘‘, if the transfer was initi-
ated after the effective date of section 905,’’; 
(6) by adding at the end the following: 
‘‘(f) SHARED LIABILITY OF INSTITUTIONS INVOLVED 
IN
AN UNAUTHORIZED
OR FRAUDULENTLY INDUCED 
ELECTRONIC FUND TRANSFER.— 
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‘‘(1) CREDITING OF CONSUMER ACCOUNT.—A 
financial institution shall reimburse a consumer for 
the amount of an electronic fund transfer that was 
unauthorized or fraudulently induced, subject to any 
liability of the consumer described under subsection 
(a). 
‘‘(2) LIABILITY
SHARING.—Subject to para-
graph (3) and with respect to a loss suffered by a 
financial institution in connection with crediting a 
consumer’s account for an electronic fund transfer 
that was unauthorized or fraudulently induced, the 
liability for such loss shall be evenly shared between 
the financial institution holding the consumer’s ac-
count and the financial institution that received the 
transfer. 
‘‘(3) LIABILITY
OF
CERTAIN
INSTITUTIONS 
THAT MATERIALLY SUPPORT OTHER FINANCIAL IN-
STITUTIONS.— 
‘‘(A) RULEMAKING.—The Bureau may 
issue— 
‘‘(i) a rule to identify certain financial 
institutions or classes of financial institu-
tions described under section 903(9)(B) 
that materially support other financial in-
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stitutions in carrying out electronic fund 
transfers; and 
‘‘(ii) such other rules as the Bureau 
determines are necessary or appropriate to 
implement the shared liability provisions 
under this subsection. 
‘‘(B) LIABILITY.—With respect to a loss 
described under paragraph (2) in connection 
with an electronic fund transfer, if any financial 
institution identified under subparagraph (A) is 
described under section 903(9)(B) with respect 
to such transfer, each financial institution and 
the two financial institutions described under 
paragraph (2) shall evenly share the liability for 
such loss.’’. 
(d) RULE OF CONSTRUCTION.—Nothing in this Act 
or the amendments made by this Act may be construed 
to limit the authority of the Bureau of Consumer Finan-
cial Protection or the applicability of relevant consumer 
financial protection laws that may otherwise impose re-
quirements that are being amended by this Act. 
Æ 
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