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Bill Summary · HB 515

HB 515 — North Carolina Economic Abuse Prevention Act

Status: Passed 2nd Reading (per information provided)
Introduced: (listed) November 12, 2024
Primary sponsor(s): Rep. T. Brown (and additional co-sponsors listed in bill materials)

Purpose and intent

The bill creates a new statutory framework (Chapter 1H, “Economic Abuse Prevention Act”) to recognize and remedy “economic abuse” — specifically “coerced debt” incurred by victims of domestic violence, domestic abuse, or related coercive conduct. The stated policy goal is to provide survivors multiple pathways to identify, dispute, and remediate coerced debt and related credit-report harms, and to make persons who coerce others into debt civilly liable.

Key provisions (summary)

  • Establishes a new Chapter 1H in the General Statutes entitled the North Carolina Economic Abuse Prevention Act.
  • Defines core terms including “coerced debt,” “claim/claimant,” “debtor,” “qualified third‑party professional,” and “adequate documentation.”
  • Describes permissible forms of “adequate documentation” that identify a debt (or portion) as coerced, including:
    • a police report;
    • an FTC identity‑theft report that identifies the debt as coerced (but not identity theft);
    • a court order from certain domestic‑relations or child welfare statutes finding debt was incurred as a result of abusive coercion; or
    • a sworn written certification from a qualified third‑party professional (with specified content requirements).
  • Specifies what a sworn certification must include (to the extent relevant): state ID, description of why the debt is coerced, transaction/account identifiers if known, any correspondence disputing the debt, identity/contact for the alleged coercer (or a sworn explanation why disclosure would endanger the survivor), and a contact for follow‑up.
  • Creates civil liability: a person who causes another to incur coerced debt is civilly liable to the claimant for the debt amount (or portion) as determined by a court, plus attorneys’ fees and costs.
  • Scope and limits:
    • Does not apply to secured debts.
    • Does not permit a court to order a refund of moneys already paid on a debt found to be coerced.
    • Does not displace other existing rights or remedies.

Who is affected

  • Primary beneficiaries: survivors of domestic violence, domestic abuse, and certain foster‑care youth who may have incurred coerced debt.
  • Directly affected parties: creditors, debt collectors, debt buyers, and any litigants asserting claims for consumer debts; qualified third‑party professionals (who may provide sworn certifications); courts handling coerced‑debt disputes.
  • Indirectly affected: credit reporting agencies and financial institutions (through increased disputes, documentation requests, or collateral litigation).

Remedies, process and limits

  • The bill creates statutory routes for a debtor/survivor to document and challenge coerced debt and enables courts to allocate liability and award attorneys’ fees/costs against the coercer.
  • It preserves claimants’ rights to pursue collection from the person who actually coerced the debt (the perpetrator), and does not mandate refunds for amounts already paid.

Procedural / timeline notes

  • The bill establishes a new Chapter (1H) in the General Statutes; as of the provided status it had passed second reading (bill information indicates “Passed 2nd Reading”).
  • Next steps (typical): further legislative readings and committee referrals as required by chamber rules; if enacted, the bill’s effective date would be set in the final enrolled act (not specified in the excerpt).

Practical considerations / potential impacts

  • Likely to increase disputes and documentation requests to debt holders and collectors; may prompt operational changes for creditors when responding to domestic‑violence‑related debt disputes.
  • Could generate litigation against alleged coercers and potentially increase demand for certified third‑party professionals (victim advocates, clinicians) to provide sworn certifications.
  • By excluding secured debt and judgments and by precluding refund orders for amounts already paid, the bill narrowly targets consumer/debt collection remedies while preserving certain creditor protections.

If you want, I can:
- Draft a short one‑page explainer for creditors or for victim‑advocate organizations outlining what documentation will be acceptable and suggested response steps; or
- Produce a timeline of the bill’s legislative movement based on the full action log.

Compiled from official sources — confirm details with the bill’s official record.

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