Bill > HB2423

This bill establishes new regulations for financial institutions in Washington state to prevent unreasonable delays in processing retirement account distributions, which are disbursements or transfers from qualified retirement plans like 401(k)s or IRAs (Individual Retirement Accounts). It defines a "financial institution" broadly to include banks, credit unions, and broker-dealers, and clarifies that "market rate interest" refers to the average four-week U.S. Treasury bill rate. The bill mandates that financial institutions must transmit funds from a valid distribution request, meaning a request submitted with all necessary documentation, within 15 business days. If a financial institution fails to meet this deadline, it must pay the consumer market rate interest on the delayed funds, calculated daily from the 16th business day until the funds are transmitted, in addition to the original distribution amount. Consumers harmed by violations can sue to recover this interest, court costs, attorney fees, and up to $500 in statutory damages per violation, with these remedies being in addition to any other legal rights they may have. The Department of Financial Institutions is empowered to create rules to enforce these provisions, and the bill explicitly excludes employee benefit plans governed by federal law.

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https://app.leg.wa.gov/billsummary?BillNumber=2423&Year=2025&Initiative=false