Bill > S01353

This bill establishes comprehensive protections for consumers who have incurred debt through economic abuse, fraud, intimidation, or coercion. The legislation defines "coerced debt" as any financial obligation incurred through means such as threats, force, manipulation, or unauthorized use of personal information, with a particular focus on protecting victims in intimate relationships, family settings, human trafficking scenarios, and situations involving vulnerable populations like children or the elderly. The bill requires creditors to pause collection activities when a debtor provides adequate documentation demonstrating the debt was coerced, such as a police report, identity theft report, court order, or verified statement from a qualified third party (like a social worker, attorney, or healthcare professional). Creditors must conduct a thorough review of the claim within 30 business days, notify consumer reporting agencies about the dispute, and communicate their findings to the debtor. If a debt is determined to be coerced, the creditor must cease collection activities and remove adverse information from credit reports. The legislation also provides debtors with a legal mechanism to challenge coerced debts through a civil action, allowing them to seek a declaratory judgment, injunctive relief, and recovery of costs and attorneys' fees. Additionally, the bill creates an affirmative defense for debtors in collection lawsuits and allows the New York Attorney General to seek injunctions and impose civil penalties against creditors who violate these provisions.

Business and Industry, Housing and Urban Affairs, Justice

https://www.nysenate.gov/legislation/bills/2025/S1353