SPRINGFIELD – Come Jan. 1, a law brought by State Senator Laura Ellman will strengthen consumer protections by stopping out-of-state tech companies from misleading residents by advertising themselves as banks when they are not properly regulated or insured.

“When people hear the word ‘bank,’ they assume their money is safe and trust that their deposits are protected,” said Ellman (D-Naperville). “This law ensures companies can’t play fast and loose with that trust just to grow their customer base.”

Under Ellman’s law, state regulators can fine companies up to $100,000 if they falsely market themselves as a bank without meeting basic requirements, including being properly chartered and operating with federal deposit insurance. The law comes amid a rise in financial technology companies advertising themselves as banks without the protections consumers expect.

The update gives the Illinois Department of Financial and Professional Regulation stronger enforcement tools to hold companies accountable and prevent deceptive marketing before Illinois consumers suffer financial losses.

Senate Bill 2318 aims to protect families from hidden financial risks, reduce confusion in the marketplace, and ensure that financial innovation does not come at the expense of consumer safety.

“This is about basic honesty and real consumer protection,” Ellman added. “If a company wants to call itself a bank, it should have to meet the same standards real banks do. Otherwise, Illinoisans deserve clear warnings before putting their hard-earned money at risk.”

Senate Bill 2318 takes effect Jan. 1, 2026.