Fair Debt Collection Practices for Servicemembers Act

S 2454, the Fair Debt Collection Practices for Servicemembers Act, prohibits debt collectors from threatening military penalties when collecting debts from servicemembers and certain dependents. It specifically bans threats to reduce a servicemember’s rank, revoke security clearance, or trigger prosecution under the Uniform Code of Military Justice (UCMJ). The bill applies to "covered individuals," defined as active-duty members, recent separation/discharge veterans (within 365 days), specific dependents, and Selected Reserve members. Debt collectors may still provide standard debt information but cannot use military consequences as collection tactics. A separate provision requires a GAO study on the bill’s impact on military readiness and security clearances.