CT SB00123

Effective January 1, 2025, prohibits knowingly causing another person to incur coerced debt, defined as unsecured credit card debt incurred by a domestic violence victim through duress, intimidation, threat of force, or undue influence

Individuals who coerce others into debt face civil liability for the full debt amount plus potential attorneys' fees and costs incurred by the victim

Requires creditors to suspend collection activities for at least 60 days when a debtor submits certified documentation alleging coerced debt, supported by a police report, protective order, or statement from a qualified professional such as a domestic violence counselor or licensed therapist

Creditors must conduct a good faith review of coerced debt claims within 10 days of receiving documentation and notify credit rating agencies that the debt is disputed; if coercion is confirmed, collection must permanently cease and negative credit information must be deleted

Debtors may only use this process once per debt, and the law does not require refunds of payments already made or eliminate other legal rights available to either party