An act relating to remedies and protections for victims of coerced debt
Sponsored By: Edye Graning (Democratic)
Signed by Governor
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Bill Overview
Analyzed Economic Effects
7 provisions identified: 5 benefits, 0 costs, 2 mixed.
Court remedies for coerced debt survivors
Beginning July 1, 2028, a survivor’s sworn statement and adequate documents shift the burden of proof to the creditor. The creditor must show the debt was more likely than not uncoerced. A court finding coercion must cancel any related default judgment; survivors can also sue perpetrators for payments and costs. Survivors have six years after discovering, or reasonably discovering, the debt or after coercion ends, whichever is later. Creditors have six years after receiving the statement and documents or learning the perpetrator’s identity, whichever is later. Courts can protect identity and contact information when disclosure risks future abuse to the survivor or immediate family. These protections apply in Vermont courts even when a contract names another state’s law.
Debt relief for survivors of abuse
Beginning July 1, 2028, proven coerced debt cannot be enforced against qualifying survivors, including debt incurred before that date. This covers domestic abuse, human trafficking, and abuse, neglect, or exploitation of vulnerable adults. The debt must involve unauthorized use of personal information or coercion, such as force, fraud, or undue influence. Mortgage and commercial loans are excluded. Creditors keep the right to take personal property securing the debt after default, but cannot collect any remaining balance from the victim.
Collection pauses for coerced debt claims
Beginning July 1, 2028, creditors must act within 10 business days after receiving a sworn coerced-debt statement and adequate documents. They must stop collection and debt transfers, notify the survivor, and tell credit reporting agencies the adverse information is disputed. Adequate documents include a police report identifying the debt, a court order, or a qualified professional’s sworn certification. Creditors must accept certified mail or verifiable electronic submissions and follow safe-contact and language-access rules. They must investigate within 30 days, with one extension of up to 15 days for relevant information submitted during that period. They must send a written decision within five business days. Proven coercion requires permanent collection relief and a request to delete adverse credit information. Otherwise, collection can resume, but debt sales and transfers remain barred; continued collection after an incomplete or oral notice requires the model form.
Privacy and enforcement for debt survivors
Beginning July 1, 2028, financial and identifying information about coerced-debt claims generally cannot be shared without the survivor’s express consent. The law allows specific disclosures required or permitted by law or authorized by a court. Privileged information remains protected unless the survivor or law expressly waives that protection. Public-body records covered by these rules are not open for public inspection or copying. Knowing, material violations are unfair trade practices; Vermont’s Attorney General can issue rules, investigate, and bring civil enforcement actions.
Bank safeguards can delay customers’ money
Beginning May 20, 2026, covered banks, credit unions, and related institutions can act on reasonable evidence of financial exploitation. They can delay or refuse transactions and withdrawals, block ownership or fund transfers, reject fraudulent power-of-attorney instructions, and prevent or change beneficiaries. These safeguards can also temporarily limit a customer’s access to money. An initial delay lasts up to 15 business days, with one extension of up to 15 business days if exploitation may continue. Delays end sooner if exploitation is unlikely or a court orders release. Institutions can alert an associated person when it serves the customer’s interests, sharing only necessary information under limited privacy-law exceptions. They can withhold notice from suspected participants and receive legal immunity for authorized good-faith acts or omissions, excluding gross negligence or willful misconduct. The Commissioner must report aggregated suspicious-hold data by January 15, 2027, and annually afterward.
Credit relief with targeted deletion limits
Beginning July 1, 2028, credit reporting agencies must review reported coerced debt, including a disputed portion and older outstanding debt. Consumers must provide a court order or a coerced-debt statement with adequate documents. Reviews are free and must finish within 30 business days; agencies must notify information providers within five business days. Agencies must consider relevant consumer evidence, delete inaccurate or unverifiable information, and give notice if they stop a frivolous review. Within five business days after completion, consumers must receive detailed results, a revised report, and an explanation of the review. Proven coerced debt must be removed from the consumer’s file and credit report. However, deletion requirements do not cover undisputed information within the same item.
Police must accept identity theft complaints
Beginning May 20, 2026, people can report known or reasonably suspected unlawful use of their personal identifying information. Vermont State Police or local police must accept the complaint and provide required complaint and officer information. If the suspected crime happened in another jurisdiction, police must refer the complaint to an agency there.
Sponsors & Cosponsors
Sponsor
Edye Graning
Democratic • House
Cosponsors
Abbey Duke
Democratic • House
Angela Arsenault
Democratic • House
Anthony "Tony" Micklus
Republican • House
Brian J Cina
Democrat/Progressive • House
Brian Minier
Democratic • House
David "Dave" Bosch
Republican • House
Ela Chapin
Democratic • House
Emilie Krasnow
Democratic • House
Emily Carris Duncan
Democratic • House
Herb Olson
Democratic • House
Jubilee McGill
Democratic • House
Kate Lalley
Democratic • House
Kate Logan
Democrat/Progressive • House
Kate McCann
Democratic • House
Kate Nugent
Democratic • House
Kirk White
Democratic • House
Laura H Sibilia
Independent • House
Leonora Dodge
Democratic • House
Rep. Mari Cordes
Affiliation unavailable
Martin J LaLonde
Democratic • House
Michael Boutin
Republican • House
Mollie S. S Burke
Democratic • House
Monique Priestley
Democratic • House
Rebecca Holcombe
Democratic • House
Rep. Robert Hooper
Affiliation unavailable
Shawn Sweeney
Democratic • House
Tiffany Bluemle
Democratic • House
Roll Call Votes
No roll call votes available for this bill.
Actions Timeline
House message: Governor approved bill on May 20, 2026
5/21/2026HouseSigned by Governor on May 20, 2026
5/20/2026HouseDelivered to Governor on May 14, 2026
5/14/2026HouseSenate Message: Passed in concurrence
5/8/2026SenateRead 3rd time & passed in concurrence
5/7/2026SenateNew Business/Third Reading
5/7/2026SenateReported favorably by Senator Gulick for Committee on Finance, read 2nd time and 3rd reading ordered
5/6/2026SenateFavorable report by Committee on Finance
5/6/2026SenateNew Business/Second Reading
5/6/2026SenateFavorable report by Committee on Finance
5/5/2026SenateEntered on Notice Calendar
5/5/2026SenateCommittee on Judiciary relieved; bill committed to Committee on Finance on motion of Senator Hashim
4/15/2026SenateRead 1st time & referred to Committee on Judiciary
3/20/2026SenateRead third time and passed
3/18/2026HouseAction Calendar: Third Reading
3/18/2026HouseThird Reading ordered
3/17/2026HouseReport of Committee on Commerce and Economic Development agreed to
3/17/2026HouseRep. Graning of Jericho reported for the Committee on Commerce and Economic Development
3/17/2026HouseRead second time
3/17/2026HouseAction Calendar: Favorable with Amendment
3/17/2026HouseNotice Calendar: Favorable with Amendment
3/13/2026HouseRead first time and referred to the Committee on Commerce and Economic Development
2/26/2025House
Bill Text
As Enacted (ACT 106)Opens in a new window
5/29/2026
As Passed by Both Chambers
5/14/2026
As Passed by Both Chambers (Unofficial)
5/14/2026
As Passed by the House
3/20/2026
As Passed by the House (Unofficial)
3/20/2026
As Introduced
2/25/2025
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