California Senate Bill SB1363 Introduced / Bill

 BILL NUMBER: SB 1363INTRODUCED BILL TEXT INTRODUCED BY Senator Runner FEBRUARY 19, 2010 An act to amend Section 17405 of, and to add Section 17405.5 to, the Financial Code, relating to escrow agents. LEGISLATIVE COUNSEL'S DIGEST SB 1363, as introduced, Runner. Escrow agents. Existing law, the Escrow Law, provides for the licensure and regulation of escrow agents by the Commissioner of Corporations. Under that law, the commissioner is authorized to conduct an indoctrination or preliminary examination, or both, of any new licensee within one year of the issuance of the license, and an inspection and examination within 2 years of the issuance of the license. This bill would require the commissioner to conduct these examinations with respect to new licensees and would also apply these provisions to a change of ownership of a licensee. The bill would also require a licensee, or the licensee's managers and shareholders, to complete a course in escrow management designated by the commissioner, within 12 months following the issuance of a new license or a change of ownership. Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. Section 17405 of the Financial Code is amended to read: 17405. (a) The business, accounts and records of every person performing as an escrow agent, whether required to be licensed under this division or not, are subject to inspection and examination by the commissioner at any time without prior notice. The provisions of this section shall not apply to persons specified in Section 17006. (b) Any person subject to this division shall, upon request, exhibit and allow inspection and copying of any books and records by the commissioner or his or her authorized representative. (c) (1) The commissioner shall conduct an examination of each licensed escrow agent as described in subdivision (a) as often as the commissioner deems necessary and appropriate, but not less than once every 48 months. (2) The examination shall be conducted for the 12-month period immediately preceding the date that the examination is commenced unless the commissioner finds, based on information uncovered in the examination or in the most recent independent audit report, that the examination should be extended beyond the 12-month period. (3) In determining how often an examination shall be conducted, the commissioner may consider each licensed escrow agent's compliance with the requirements set forth in this division and other factors the commissioner may by rule or order designate. (4) This subdivision shall apply only to examinations commenced after the effective date established by the rule or order of the commissioner for the factors described in paragraph (3). (d) Notwithstanding subdivision (c), the commissioner  may   shall  conduct an indoctrination or preliminary examination, or both, under this section of any new licensee  or of a licensee that has a change in ownership  within one year of the issuance of the license  or of the change of ownership  under this division, and an examination described in subdivision (a) within two years of the issuance of the license  or of the change of ownership  under this division. SEC. 2. Section 17405.5 is added to the Financial Code, to read: 17405.5. A licensee, or the licensee's managers and shareholders, shall, within 12 months following the issuance of a new license or a change of ownership, complete a course in escrow management designated by the commissioner.