Georgia's New Transaction Hold Law: What Financial Institutions Need to Know

Key Takeaways:

• Broad institutional coverage. Georgia's Transaction Hold Law, effective July 1, 2026, applies to most federally insured depository institutions doing business in Georgia. The new law grants discretionary authority to hold transactions suspected of involving financial exploitation of eligible adults.
• Hold authority is not automatic. Institutions must first satisfy three statutory preconditions, including (1) developing training policies, (2) delivering and documenting training, (3) and maintaining written internal review procedures, before exercising any hold or relying on the statute's immunity protections.
• A rapidly evolving multistate landscape. Georgia joins a growing wave of state legislation on elder financial exploitation, alongside recent enactments and amendments in Florida, Colorado, Tennessee, and Louisiana. Multistate institutions should be considering whether to implement a transaction hold policy consistent with these laws.

Over the summer, Georgia joined the growing list of states that empower financial institutions to step in when they suspect a customer is being financially exploited. O.C.G.A. § 7-1-239.11 et seq. (the new “Transaction Hold Law” or the “Law”), effective July 1, 2026, gives covered institutions the authority to place holds on suspicious transactions. If your institution has depositors in Georgia, now is the time to take stock of what the Law requires.

The Transaction Hold Law has an intentionally broad reach. The term “financial institution” covers not only banks and credit unions chartered in Georgia as well as money transmission licensees, but it also covers banks and credit unions chartered by other states, national banks, federal credit unions, and federal savings and loan associations, so long as they carry federal deposit insurance. In practical terms, that means most federally insured depository institutions doing business in Georgia have reason to assess the new Law.

So, who is the Law intended to protect? The statute covers “eligible adults,” which is a term that encompasses both “disabled adults” and “elderly adults.” A “disabled adult” is anyone 18 or older who is mentally or physically incapacitated, has Alzheimer's disease, or has dementia. An “elderly adult” is any natural person 65 or older. Taken together, these definitions cast a wide net and cover not only aging customers but also younger adults with qualifying impairments.

This is the big headline for all the financial compliance officers: the authority to place a hold allowed by the Law is not entirely self-executing. Before a financial institution can exercise any hold, it must first satisfy three mandatory preconditions set out in O.C.G.A. § 7-1-239.15:

• First, the institution must develop training policies or programs reasonably designed to educate the employees who perform or approve transactions on issues related to financial exploitation.

• Second, the institution must actually deliver that training and keep a written record documenting that it has done so.

• Third, the institution must develop, maintain, and enforce written procedures that govern how suspected financial exploitation is reviewed internally.

These are not best practices to aspire to or items to put on next year's compliance roadmap: they are statutory preconditions to exercising hold authority. Put differently, an institution that has not built out a compliant training and internal review framework before implementing a hold is on shaky ground, and the immunity protections the statute offers may be hard to rely on without a documented compliance infrastructure already in place.

With those prerequisites in mind, the hold mechanics work as follows. Pursuant to § 7-1-239.12, a financial institution may – but is not required to – place a hold on a financial transaction when it has “reasonable cause to suspect” the transaction may involve, facilitate, result in, or contribute to financial exploitation. The hold can reach the account of an eligible adult, an account on which the eligible adult is a beneficiary, and – importantly – the account of a person suspected of perpetrating the exploitation. Notably, Georgia’s hold law covers both sending (victim) and receiving (perpetrator) accounts; many state transaction hold laws, like Florida’s, only reach the sending side.

A hold can also be triggered when the Georgia Department of Human Services or a law enforcement agency shares information demonstrating reasonable cause to suspect financial exploitation.

As for timing, a hold expires on the fifteenth business day after it was placed. If the institution's review of the facts still supports a reasonable belief that exploitation is at play, it can extend the hold for up to an additional 15 business days. A court may shorten or extend the hold at any time, and the statute does not prevent an institution from voluntarily lifting a hold after communicating with authorized parties or trusted contacts.

There are also notification obligations to keep in mind. When a hold goes into effect, the institution must provide written notice to all parties authorized to transact on the account and any trusted contact, no later than three business days after the hold is placed. That notice must include the reason for the delay. There is a common-sense carve-out: notice need not go to anyone the institution reasonably believes is involved in or attempting the suspected exploitation.

On a related note, § 7-1-239.11 allows institutions to offer eligible adults the chance to designate at least one trusted contact per account. The institution cannot require the trusted contact to consent as a condition of being designated.

On the recordkeeping side, institutions must create and maintain a record of every hold and capture the account holder's information, the date the hold was placed, the facts that prompted it, and how it was ultimately resolved. In exchange, the Law offers a meaningful quid pro quo: an institution acting in good faith and exercising reasonable care is immune from administrative, criminal, and civil liability for its actions or inactions. That immunity extends to individual officers, directors, and employees as well.

Conclusion

What does all of this mean from a practical standpoint? Financial institutions should be thinking about several things at once: updating internal policies to incorporate hold authority and escalation protocols; building or refining trusted contact designation processes; standing up compliant training programs with solid documentation practices; and making sure recordkeeping systems can capture what the statute demands. For institutions that operate across state lines, the goal should be to weave Georgia's requirements into an existing, broader multistate compliance framework.

It’s worth noting that the pace of legislative activity in the elder-financial-exploitation space in the last two years has been remarkable. Florida introduced a transaction hold into an existing mandatory reporting scheme effective January 1, 2025, and Colorado's new ASSET Act became effective August 12, 2026, and has a notably longer maximum hold duration: up to 180 days. Meanwhile, several states with existing transaction hold laws have enacted significant amendments in 2026: Tennessee (Tenn. Code Ann. § 45-2-1201 et seq., amended effective May 19, 2026) broadened its covered institutions to include money transmitters and refined its hold procedures, and Louisiana (La. Rev. Stat. Ann. § 6:1371 et seq., amended effective August 1, 2026) updated its framework as well.

For institutions with multistate footprints, the takeaway is clear: this legislative trend is accelerating across both new enactments and amendments to existing laws, and staying ahead of it requires active and ongoing monitoring. On October 14, 2026, Adams & Reese is hosting a Zoom webinar entitled “Compliance in Focus: Emerging Issues for Banks & Lenders.” The program will feature five breakout sessions, including one on Georgia’s new Law. Click here to register: Compliance in Focus: Emerging Issues for Banks & Lenders Webinar.