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New YorkS 13532025-2026 Regular SessionSenateWALLET

Establishes a right of action for claims arising out of coerced debts

Sponsored By: Cordell Cleare (Democratic)

Signed by Governor

CONSUMER PROTECTIONCODES

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Bill Overview

Analyzed Economic Effects

4 provisions identified: 4 benefits, 0 costs, 0 mixed.

Court relief for victims of coerced debt

You can sue a creditor to prove that all or part of a debt was coerced. First, send notice by a method confirming the mailing date. You can sue after the 30-business-day review ends without written notice that collection stopped, or after a written rejection. Your lawsuit must explain the facts in detail and attach the documents sent to the creditor. You generally have three years after notice; a new notice after stopped collection resumes starts a new three-year period. If you show the debt was more likely than not coerced, the court must declare you not personally liable. It may stop collection, dismiss collection claims, order negative credit information deleted, and award reasonable legal costs and attorney fees. For debt secured by property, relief covers only the unpaid balance after foreclosure, repossession, or surrender and disposal of the property. It does not erase the creditor's rights to collateral or lawful claims against other people. If a creditor sues you, you can raise coerced debt as a defense without first sending notice. You must attach the required documents to your answer; winning this defense entitles you to reasonable legal costs and attorney fees. The accused person does not have to be a party to that collection case. On your request, courts must take appropriate steps to protect you or immediate family from abuse, such as sealing records, removing personal details, or holding hearings remotely.

Collection pauses for victims of financial abuse

The law takes effect 90 days after enactment and covers consumer debt caused by economic abuse. This includes threats, fraud, manipulation, or use of your personal information without consent. Creditors, including debt collectors, must immediately pause collection when you identify a coerced debt or portion and provide qualifying documents. Creditors must give debtors missing documents written instructions explaining the required sworn or notarized statement and supporting evidence. Evidence can be a police report, Federal Trade Commission identity-theft report identifying coerced debt, court order, or qualified third party's sworn or notarized statement. It must identify the debt and explain how it arose; qualified sources include lawyers, health professionals, social workers, and victim advocates. Within 10 business days, creditors must flag the dispute with credit reporting agencies that received their negative reports. Creditors have 30 business days to review, must use only your supplied contact information, and cannot contact the accused person. They must keep your materials confidential unless you authorize disclosure in writing. Within five business days after review, creditors must explain any resumed collection and supply supporting documents without others' personal information. If collection stops, they must notify you, direct deletion of negative credit reports, and notify downstream collectors when applicable. You can request reconsideration within 30 days; creditors must finish it within 30 days, but reconsideration is not required before suing.

Stronger enforcement of coerced debt protections

If a creditor's violation of the coerced-debt procedures injures you, you can sue for $1,000 in statutory damages. You may also recover proven losses and reasonable legal costs and attorney fees. The New York Attorney General can investigate using subpoenas, seek repayment, and ask courts to stop violations and award legal fees. The Attorney General must give at least five days' notice before seeking an injunction; proof of personal injury is not required. Courts may impose civil penalties of up to $5,000 for each violation.

Victims can recover from debt coercers

The law prohibits causing another person to incur coerced debt. Courts can order the person responsible to pay the creditor, the debtor, or both for the amount found coerced. Courts may also award reasonable legal costs and attorney fees. You can seek recovery only after paying some or all of the coerced debt. The lawsuit must begin within three years after the later of the creditor's or a court's determination that the debt is coerced.

Sponsors & Cosponsors

Sponsor

  • Cordell Cleare

    Democratic • Senate

Cosponsors

  • Brad Hoylman-Sigal

    Democratic • Senate

  • Julia Salazar

    Democratic • Senate

  • Lea Webb

    Democratic • Senate

  • Leroy Comrie

    Democratic • Senate

  • Robert Jackson

    Democratic • Senate

  • Zellnor Myrie

    Democratic • Senate

Roll Call Votes

All Roll Calls

Yes: 217 • No: 74

House vote • 6/11/2025

Assembly floor vote

Yes: 96 • No: 50

Senate vote • 6/9/2025

FLOOR Vote

Yes: 51 • No: 11

Senate vote • 5/13/2025

FLOOR Vote

Yes: 46 • No: 11

committee vote • 4/29/2025

Judiciary Committee Vote

Yes: 17 • No: 2

committee vote • 1/28/2025

Consumer Protection Committee Vote

Yes: 7 • No: 0

Actions Timeline

  1. APPROVAL MEMO.85

    12/19/2025Senate

  2. SIGNED CHAP.710

    12/19/2025Senate

  3. DELIVERED TO GOVERNOR

    12/8/2025Senate

  4. RETURNED TO SENATE

    6/11/2025House

  5. PASSED ASSEMBLY

    6/11/2025House

  6. ORDERED TO THIRD READING RULES CAL.305

    6/11/2025House

  7. SUBSTITUTED FOR A3038B

    6/11/2025House

  8. REFERRED TO CODES

    6/9/2025House

  9. RETURNED TO ASSEMBLY

    6/9/2025Senate

  10. REPASSED SENATE

    6/9/2025Senate

  11. AMENDED ON THIRD READING 1353B

    5/22/2025Senate

  12. VOTE RECONSIDERED - RESTORED TO THIRD READING

    5/22/2025Senate

  13. RETURNED TO SENATE

    5/22/2025House

  14. RECALLED FROM ASSEMBLY

    5/22/2025Senate

  15. REFERRED TO CODES

    5/13/2025House

  16. DELIVERED TO ASSEMBLY

    5/13/2025Senate

  17. PASSED SENATE

    5/13/2025Senate

  18. ADVANCED TO THIRD READING

    5/1/2025Senate

  19. 2ND REPORT CAL.

    4/30/2025Senate

  20. 1ST REPORT CAL.773

    4/29/2025Senate

  21. PRINT NUMBER 1353A

    4/1/2025Senate

  22. AMEND AND RECOMMIT TO JUDICIARY

    4/1/2025Senate

  23. REPORTED AND COMMITTED TO JUDICIARY

    1/28/2025Senate

  24. REFERRED TO CONSUMER PROTECTION

    1/9/2025Senate

Bill Text

  • Amendment B

    5/22/2025

    PDF

  • Amendment A

    4/1/2025

    PDF

  • Original

    1/9/2025

    PDF

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