Today's Law As Amended

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SB-373 Consumer debt: economic abuse.(2021-2022)

As Amends the Law Today

 The Legislature finds and declares all of the following:
(a) Economic abuse is a serious issue impacting survivors of domestic violence, elder or dependent adult abuse, foster youth, and other individuals.
(b) Coerced or fraudulent debts, a common component of economic abuse, can ruin an individual’s credit history and financial stability, including by leaving the individual vulnerable to debt collection, substantial payment expectations, and bankruptcy.
(c) The debt and poor credit score resulting from economic abuse impact can have long-term consequences for survivors that create barriers to education, housing, and employment opportunities.
(d) Fifty-two percent of domestic violence survivors report experiencing coerced and fraudulent debt of over $10,000 per year.
(e) In cases of elder abuse, family members and other trusted individuals can use their powerful position to commit this type of abuse and take out debts through coercion or fraud.
(f) Youth in foster care are particularly vulnerable because they may have multiple placements that give many adults access to their personal information.
(g) A pilot project in the City of Los Angeles worked with over 100 foster youth who had hundreds of separate accounts reported in their names as the result of errors or identity theft. A 2018 survey conducted by the Identity Theft Resource Center (ITRC) and Symantec that included youth in the Counties of Santa Clara and San Diego found that 15 percent of foster youth surveyed were victims of identity theft.

SEC. 2.

 Section 1788.19 is added to the Civil Code, immediately following Section 1788.18, to read:

 (a) (1) A debt collector shall not collect or attempt to collect a consumer debt if the consumer provides documentation to the debt collector that the debt, or any portion of the debt, is the result of economic abuse.
(2) Sufficient documentation of economic abuse for purposes of this subdivision includes, but is not limited to, all of the following:
(A) A copy of a protective order lawfully issued pursuant to Section 6340 of the Family Code, Section 136.2 of the Penal Code, or Section 213.5 or 15657.03 of the Welfare and Institutions Code.
(B) A police report indicating the individual was a victim of domestic violence or elder abuse.
(C) A Federal Trade Commission identity theft report.
(D) Documentation from a licensed medical professional, domestic violence counselor, as defined in Section 1037.1 of the Evidence Code, a sexual assault counselor, as defined in Section 1035.2 of the Evidence Code, licensed health care provider, attorney, social worker, or counselor stating that the debt was incurred as a result of economic abuse.
(b) A debt collector shall not require a court order or a police report to prove that the debt is the result of economic abuse.
(c) Information regarding a consumer debt documented to result from economic abuse pursuant to this section shall be deemed incomplete or inaccurate for purposes of subdivision (a) of Section 1785.25.
(d) For purposes of this section, “economic abuse” means a person causing or attempting to cause an individual to have impaired financial stability by maintaining control over the individual’s financial resources, including, but not limited to, unauthorized or coerced use of credit or property, withholding access to money or credit cards, forbidding attendance at school or employment, stealing or defrauding money or assets, exploiting the individual’s resources for personal gain, or withholding physical resources, including food, clothing, necessary medications, or shelter.