The "Third-Party Litigation Funding Transparency Act" aims to regulate third-party litigation funding by establishing clear guidelines for funding companies and attorneys. Key provisions include mandatory disclosures in consumer litigation funding contracts, which must be clearly written and include details such as the funded amount, itemized charges, and payment schedules. The bill prohibits litigation funding companies from paying referral fees to attorneys and sets a maximum annual charge of 36% on funded amounts. Additionally, contracts will be void if the attorney does not acknowledge the terms, ensuring consumer protection and informed consent.

The bill also requires litigation funding companies to register with the Department of Insurance and Financial Services, imposes civil fines for non-compliance, and mandates that consumers disclose any funding contracts to involved parties within 30 days of a written request. It presumes that such contracts are discoverable in civil proceedings, despite confidentiality agreements, while allowing consumers to rebut this presumption. Furthermore, communications between a consumer's attorney and a funding company regarding the legal claim's status are protected from discovery by opposing parties. The legislation seeks to enhance transparency and accountability in the litigation funding industry, ensuring fair treatment and protection of consumer rights.