The bill, S.B. No. 2902, aims to amend the Finance Code by adding a new section that addresses the collection of consumer debt incurred by individuals as a result of identity theft. It defines "identity theft" and establishes that creditors, debt collectors, or third-party debt collectors are prohibited from attempting to collect debts from consumers who provide evidence of being victims of identity theft, such as a court order or a Federal Trade Commission identity theft victim's report. The bill specifies that this protection does not extend to home loans or judgments already obtained.

Additionally, the bill outlines the responsibilities of creditors and debt collectors upon receiving notice of a disputed debt due to identity theft. They must cease collection efforts, notify relevant parties of the dispute, and are restricted from selling or transferring the debt, except to pursue the actual perpetrator of the identity theft. The bill also allows creditors to take legal action against consumers if they believe the claim of identity theft is based on a material misrepresentation. The provisions of this act are set to take effect on September 1, 2025.

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