The "Third-Party Litigation Financing Consumer Protection Act" establishes a new chapter in Rhode Island's General Laws to regulate litigation financing, which involves funding legal actions by entities other than the involved parties. The Act defines key terms such as "consumer," "litigation financer," and "litigation financing transaction," while excluding contingency fee services provided by legal representatives. It requires litigation financers to register with the state, maintain a surety bond of at least $50,000, and adhere to strict prohibitions, including not offering legal advice or accepting referral fees. The Act mandates that all documents related to litigation financing be public records and outlines specific consumer protections, such as requiring clear disclosures in financing agreements.

Additionally, the bill imposes comprehensive reporting requirements on litigation financers, including detailed information about their operations and annual reporting to the secretary of state. It also mandates that legal representatives disclose any financial interests or referral fees related to litigation financing. The Act applies to class action lawsuits and exempts financing for commercial enterprises, except in personal injury cases. Violations of the chapter will render financing contracts unenforceable, and the Act will take effect upon passage. Overall, the legislation aims to enhance transparency and protect consumers from potential exploitation in litigation financing.