The bill amends the Business & Commerce Code to address the filing of fraudulent financing statements in secured transactions. It prohibits individuals from knowingly presenting a forged, materially false, or groundless financing statement for filing. Those who violate this provision are liable to any injured party for damages, court costs, and reasonable attorney's fees. Additionally, the bill allows property owners affected by fraudulent filings to seek specific relief through the courts, including the release of the fraudulent statement. New provisions are introduced that enable debtors to file an affidavit asserting the impermissibility of a financing statement, which the filing office must act upon by filing a termination statement.

Furthermore, the bill establishes a fee for filing such affidavits to cover administrative costs and clarifies that the filing office and its employees are not liable for actions taken in compliance with the law. It also specifies that affidavits cannot be filed against financing statements from regulated lending institutions. The bill includes amendments to existing sections regarding continuation statements, ensuring they remain effective unless specific conditions are met. The act is set to take effect on September 1, 2025.

Statutes affected:
Introduced: Commerce Code 9.5185, Commerce Code 9.510, Commerce Code 9.515 (Commerce Code 9)