Alabama House Approves Drastic Regulations That Would Eliminate a Financial Lifeline and an Entire Industry

April 27, 2015

Contact: Eric Schuller, President ARC 

Alabama House Approves Drastic Regulations That Would Eliminate a Financial Lifeline and an Entire Industry

HB 160 Removes Key Finance Option from Working Class Families Injured in Accidents

Montgomery, AL — State lawmakers in the Alabama House, took a disappointing step toward eliminating a product that has proven to be a lifeline for constituents. The House passed HB 160, which would effectively take away the availability of Consumer Legal Funding for the many people in Alabama who seek help making ends meet financially after they’ve been injured in accidents that are not their fault, and while they wait for the long process of getting an insurance settlement. For people who have to miss some work while they recover, Consumer Legal Funding helps them keep their families afloat by providing money for basic necessities like rent/mortgage, transportation, electric bills and groceries.

The regulations imposed by HB 160 are so drastic, they will have just one effect: putting an entire industry out of business and taking the helpful option of Consumer Legal Funding away from working class people. One such person is Ron Iocca, a Phenix City man who recently explained how legal funding helped him, and urged Alabama lawmakers to keep the interests of constituents at the forefront. Ron told lawmakers:

“I know I would not have been able to make it through those two painful years the case was being dragged out, and to get a fair settlement, had it not been for Legal Funding.” (full story at this address: (more comments from Alabamians at this address:

There is proof that drastically harsh regulations will drive businesses out of places that enact them. Legislation similar to HB 160 was enacted last year in Tennessee, and this year in Arkansas. Dozens of Consumer Legal Funding companies have pulled out of those states. The vast need for their service among constituents will not be met.


4 states have enacted common sense legislation to regulate the Consumer Legal Funding industry in a way that ensures people have access to the important financial tool if they need and want it. We urge lawmakers in the Alabama Senate to follow this lead and take a more measured approach that regulates Consumer Legal Funding in a way that keeps it available to help the people of Alabama.

The Alliance for Responsible Consumer Legal Funding (ARC) represents a coalition of consumer legal funding companies, service providers, academics, and other industry supporters. It works at the state and federal levels to ensure the proper regulation of the legal funding industry in the United States. ARC aims to accomplish this mission by advocating at the state level for rules containing appropriate pricing and a high degree of consumer protection—including adequate licensing and disclosure requirements, and suitable limitations on fees—and at the federal level by working with policymakers to help ensure the alignment of federal and state regulatory efforts affecting the legal funding industry. For more information, visit


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