April 18, 2024

Brown, Reed Push Big Banks to Protect Consumers from Wire Fraud

WASHINGTON, D.C. – Today, U.S. Senators Sherrod Brown (D-OH), Chairman of the Senate Committee on Banking, Housing, and Urban Affairs, and Jack Reed (D-RI), a senior member of the Senate Banking and Housing Committee, are pushing the nation’s four largest banks to protect consumers from costly and damaging wire fraud. In a letter to the CEOs of JPMorgan Chase, Bank of America, Wells Fargo, and Citi, the Senators press the banks to provide data on wire fraud at their banks and information about their current policies to protect consumers from financial devastation.

“Consumers use wire transfers to send large dollar amounts, often to purchase a home or make significant investments, meaning wire fraud is often a life-changing event that can wipe out consumers’ savings or irreparably damage their finances,” the Senators wrote. “Banks have a responsibility to proactively monitor and prevent unauthorized and fraudulently induced transactions. We believe banks should reimburse their customers when they fail to meet these obligations…. With improved fraud prevention and reimbursement practices, consumers would no longer be left on the hook to the tune of billions of dollars annually.”

In 2023, consumers lost more than $10 billion due to fraud – up 14 percent from the year before. According to the Federal Trade Commission, in terms of dollars lost, “Bank Transfer or Payment” is the largest payment method used by fraudsters.

Brown has long pushed to hold big financial institutions accountable to protect consumers from fraud and scams. Earlier this year, Brown and his colleagues pushed the CEO of Zelle to publicly clarify their reimbursement policy for imposter scams, reimburse customers for additional types of scams, and streamline the process for consumers to report unauthorized transactions, scams, and fraud. In December, he also pressed the CEOs of Venmo and Cash App to adopt new policies to reimburse consumers who get scammed, and make it easier for users to report scams and fraud on these platforms.