The "Litigation Financing Transparency Act" aims to enhance transparency in litigation financing by establishing clear definitions and requirements for disclosures related to litigation financing agreements. Key provisions include the prohibition of certain conduct by litigation financiers, such as directing the course of an action or paying referral fees. Additionally, legal counsel must provide copies of litigation financing agreements to all parties involved within a specified timeframe, and there are ongoing disclosure obligations regarding relationships with foreign entities and the nature of the financing.

The Act also mandates that litigation financiers indemnify funded consumers against adverse costs and sanctions, with exceptions for wrongful conduct by the consumer. Any litigation financing agreement that violates the Act is deemed void, and violations are classified as unlawful acts under the Unfair Practices Act. The provisions of this Act will apply to civil actions and administrative proceedings initiated on or after its effective date of December 31, 2025.