Minnesota Enacts New Order for Protection Against Financial Exploitation of a Vulnerable Adult (Minn. Stat. § 609.2334) Effective January 1, 2026

This past legislative session, Minnesota enacted a new statute, Minn. Stat. § 609.2334, creating an order-for-protection (OFP) mechanism specifically targeting the financial exploitation of vulnerable adults. Beginning January 1, 2026, courts across the state are authorized to issue protective orders aimed at preventing, mitigating, or halting suspected or ongoing financial exploitation.

The statute is focused on protecting vulnerable adults from financial harm and has direct operational implications for financial institutions requiring compliance with court-issued orders including but not limited to placing transactional holds on accounts, restricting access to accounts or assets, and furnishing records. Those in the banking and financial services industry must be aware of the implications of the new statute and, in anticipation of the new statute taking effect January 1, 2026, should take action to implement the law’s requirements, through policy updates, workflow changes, training, and documentation protocols.

Key Provisions and Definitions Relevant to Financial Institutions

The law was created to be intentionally broad to allow flexibility to address bad behavior, which poses potential issues in implementing a Court’s Order. While the precise terms of any individual order will be case-specific, financial institutions should anticipate the following features as typical of this type of protective regime:

1. The statute authorizes petitions by or on behalf of a vulnerable adult, and it empowers courts to grant relief tailored to prevent or remedy financial exploitation. Relief may include prohibiting respondents from initiating or completing financial transactions; restricting access to accounts, property, or payment instruments; directing the safeguarding or return of funds; and authorizing disclosures necessary to effectuate the order. Orders may be issued on an expedited or ex parte basis where immediate protection is warranted, with subsequent hearings for longer-term relief.
2. The statute imports or aligns with Minnesota’s existing definitions surrounding vulnerable adults and financial exploitation, which generally encompass adults who, due to age, disability, or dependency, are susceptible to abuse, neglect, or exploitation, and conduct that includes the wrongful taking, use, or retention of funds or assets, or undue influence to obtain control over assets or decision-making. Financial institutions should use these benchmarks in assessing how to operationalize requests and in training frontline staff.
3. Orders may expressly direct financial institutions to implement holds or restrictions, decline certain transactions, freeze or segregate funds pending a hearing, or provide account-level information to the court or certain parties, consistent with confidentiality requirements. Orders may also address or impose requirements on instruments such as powers of attorney, fiduciary accounts, beneficiary designations, and access credentials, that are implicated in suspected exploitation.
4. The statute  compels compliance with court orders and may include liability protections for good-faith compliance. Conversely, willful noncompliance with a duly issued order will likely carry legal consequences, including contempt exposure. Institutions should confirm the availability and contours of any safe harbors and immunities under the statute and related Minnesota law with their legal counsel.
5. The Court has the ability to issue an ex parte temporary order for up to 14 days. Prior to or on the 14^th day, the Court is required to hold a hearing, at which point the order may be extended  by an additional 14 days.
6. Each Order will be case-specific and will have different timelines as to account freezes and the release of those freezes. Proper review and interpretation of each Order is important to ensure correct compliance with the Order.
7. Note, any assets held in a conservatorship account may only be frozen by an Order entered by the Court overseeing the conservatorship proceeding. If an institution is served with an OFP under the new law, it should be accompanied by a second Order from the Court overseeing the conservatorship proceeding.

Effective Date as a Compliance Milestone: January 1, 2026

January 1, 2026, is the operative date for institutional readiness. By that date, institutions must be capable of promptly recognizing, routing, and implementing qualifying orders. Internal systems should be calibrated to ensure accurate identification of these court orders and efficient execution without violating customer rights, privacy obligations, or other legal duties. Given intersecting operational and legal issues, a cross-functional readiness program should be completed by the close of 2025.

Operational Impacts for Banks and Financial Institutions

The statute will affect multiple functions across banking organizations. At the front line, branch and call-center personnel must be trained to recognize court instruments specific to financial exploitation and to escalate immediately to legal or specialized teams, ensuring that exploitation concerns are triaged alongside ongoing fraud investigations and suspicious activity monitoring, without duplicative or conflicting actions.

For payments and transaction processing, institutions will need mechanisms to apply temporary holds or restrictions in response to an order while observing regulatory timelines and network rules for ACH, wire, card, and P2P transactions. Where Orders intersect with Regulation E error resolution, UCC Article 4A wire rules, or network chargeback requirements, the bank will want to have escalation protocols that address timing and documentary requirements.

Account operations will need procedures to segregate or restrict funds, halt disbursements, or suspend access to online and mobile channels when ordered, with clear parameters for what remains permitted (e.g., essential living expenses if the order so provides). Fiduciary and wealth management units should prepare for Orders affecting powers of attorney, trustee or conservator authority, or beneficiary designations, including steps to validate the identity and authority of purported fiduciaries and to reconcile the Order with existing account agreements and governing instruments.

Legal and subpoena teams will need standardized templates and checklists for intake, validation, scope interpretation, and response, along with guidance on permissible disclosures under state law, the Gramm-Leach-Bliley Act’s exceptions for fraud prevention and legal process, and bank secrecy obligations.

Recordkeeping and audit functions should ensure that holds and order compliance actions are fully documented and retrievable to support examinations, litigation defense, or law enforcement inquiries.

Preparing for Compliance

Financial institutions should adopt a structured readiness plan that addresses governance, people, process, and technology. Steps could include:

1. Designation of a point person at the bank and owner of the internal process to cover  legal, BSA/AML, fraud, operations, payments, digital banking, retail, wealth, and privacy areas.
2. Policies should be updated to recognize the new orders bank may receive in light of the new law, articulate escalation thresholds, and set decision rights for initiating or lifting holds on accounts in conformity with court directives.
3. Procedurally, transactional controls should allow for partial or tailored holds when an order specifies affected accounts, instruments, or counterparties. Where orders contemplate releasing funds for essential expenses or setting spending limits, workflows should support those parameters without blanket freezes that exceed the order’s scope.
4. Risk management protocols should include enhanced monitoring for attempted circumvention, such as opening new accounts, cash withdrawals at different locations, or third-party transfers designed to evade restrictions.
5. Communication protocols should be carefully managed. All customer or third-party communications about a Court Order should be centralized through designated teams to avoid misstatements, protect privacy, and reduce litigation risk.
6. Institutions should coordinate with Adult Protective Services and law enforcement only through approved channels and consistent with the Court Order’s terms and applicable confidentiality laws.

Potential Legal Risks and Liability Considerations

The principal risk of noncompliance is exposure to court sanctions for failing to implement the Order as directed, including contempt. There is also the risk of civil claims brought by the protected adult or their representatives if an institution negligently permits transactions in violation of the Order, resulting in loss. Conversely, overly broad or prolonged holds that exceed the Order’s scope may prompt claims by respondents or accountholders for wrongful restriction, contractual breach, or unfair practices, particularly if essential transactions are blocked without legal basis.

Privacy and confidentiality risks may arise when responding to requests for records or information. Institutions should ensure disclosures are limited to those authorized by the Order or permitted by law. Institutions should also be attentive to conflicts between this statute and other legal directives, such as existing guardianship or conservatorship orders, powers of attorney, or prior court decrees; legal review should reconcile competing instruments and, where necessary, seek clarification from the issuing court.

Operational errors, such as delayed implementation, system misconfigurations, or failure to release holds upon expiration or modification of an order, present additional risk.

Key Takeaways

Minn. Stat. § 609.2334 introduces a court-administered tool to prevent and remediate the financial exploitation of vulnerable adults, with meaningful operational consequences for financial institutions. With the statute taking effect on January 1, 2026, institutions should treat the remaining time in 2025 as an implementation runway to update governance policies, processes, systems, and training. Early, coordinated preparation will reduce risk, strengthen customer protection, and support timely and accurate compliance with court directives under the new law.

If you have questions about how this new law may impact your organization, or want to learn more about how you can prepare for a smooth transition, please reach out to any member of our Trusts, Wills & Estates team for guidance.