| 1 | | - | Amended IN Assembly April 27, 2021 CALIFORNIA LEGISLATURE 20212022 REGULAR SESSION Assembly Bill No. 1089Introduced by Assembly Member GraysonFebruary 18, 2021 An act to amend, repeal, and add Sections 1789.11, 1789.12, 1789.13, 1789.14, 1789.15, 1789.16, 1789.19, 1789.21, and 1789.25 of, and to add Sections 1789.11.1, 1289.11.3, 1789.11.5, 1789.12.1, 1789.12.3, 1789.12.5, 1789.12.7, 1789.12.9, 1789.12.11, 1789.12.13, 1789.12.15, 1789.12.17, 1789.12.19, 1789.12.21, 1789.12.23, 1789.12.25, 1789.12.27, 1789.12.29, 1789.12.31, 1789.12.33, 1789.12.35, 1789.12.37, 1789.12.39, 1789.12.41, 1789.12.43, 1789.12.45, 1789.134, and 1789.135 to, the Civil Code, relating to consumer credit. LEGISLATIVE COUNSEL'S DIGESTAB 1089, as amended, Grayson. Credit services organizations. Existing law, the Credit Services Act of 1984, defines and regulates the activities of credit services organizations. Existing law generally defines a credit services organization as a person who, for payment, performs specified credit-related services, such as improving a buyers credit record and obtaining loans. Existing law requires credit services organizations to obtain a surety bond, as specified, before conducting business and requires that they register with the Department of Justice, subject to a fee of $100.Existing law requires that credit services be provided pursuant to a written contract, which is required to contain specified provisions, and requires the credit services organization to provide a prescribed information statement before the execution of the contract. Existing law requires the contract to contain a notice informing the buyer that the contract can be canceled within 5 days from the date the contract is signed. Existing law prohibits, among other things, a credit services organization from receiving money before full and complete performance of the service the organization has agreed to perform and prohibits failing to perform the agreed-upon services within 6 months. Existing law makes a violation of these provisions a misdemeanor.Existing law authorizes a buyer of services who is injured by a credit services organizations violation of the act, or its breach of contract, to bring an action for damages or injunctive relief, as specified. Existing law also authorizes any person, including a consumer credit reporting agency, to bring an action, as specified, for a violation of these provisions.This bill would revise and recast these provisions to, instead, require the Department of Financial Protection and Innovation, commencing on January 1, 2023, to license, regulate, and oversee credit services organizations. The bill would, beginning on January 1, 2022, require the department to take all action necessary in order to be prepared to perform these duties commencing January 1, 2023, including, but not limited to, the adoption of necessary regulations. The bill would prohibit the public disclosure of specific information provided by a licensee to the department.This bill would prohibit a person from engaging in credit services in this state without a license and would also require the person to comply with specified requirements, and the reporting, examination, and other oversight requirements issued or mandated by the department. The bill would require a person applying for a license to, among other things, pay an application fee, sign the application under penalty of perjury , perjury, and submit to a criminal background check by the department. By expanding the scope of the crime of perjury this bill would impose a state-mandated local program.This bill would require each licensee to, among other things, file reports with the Commissioner of the Department of Financial Protection and Innovation under oath, maintain a surety bond, and pay to the department its pro rata share of all costs and expenses reasonably incurred in the administration of these provisions, as estimated by the department. The bill would authorize the department to enforce these provisions by, among other things, adopting regulations, performing investigations, suspending or revoking a license, issuing orders and claims for relief, and enforcing the provisions, as specified.The bill would revise information that must be provided to a consumer before a credit service contract is executed, including a notice regarding the filing of complaints with the department and would require the Attorney General and the department to maintain an internet website for this purpose.This bill would replace the term buyer with the term consumer for purposes of describing a person utilizing the services of a credit services organization and would prescribe other definitions in this regard. The bill would require a credit services organization to provide a consumer an itemized a monthly statement showing each service performed for a consumer, as specified, and would require the organization to perform services agreed upon within 180 days of contracting for those services. The bill would require the information statement and contract to inform the consumer that the contract can be canceled before midnight on the 5th working day after execution of the document it.This bill would extend prohibitions on counseling a consumer to make untrue statements to other specified parties. Among other things, the bill would prohibit a credit services organization from impersonating a consumer and failing to identify communications as originating from the organization, from submitting a dispute to a consumer credit reporting agency, creditor, debt collector, or debt buyer more than 180 days after the disputed account has been removed, or from failing to provide along with its first written communication to a credit reporting agency or data furnisher sufficient information to investigate a dispute of an account. The bill would require a consumer credit reporting agency, creditor, debt collector, or debt buyer that knows that a consumer is represented by a credit services organization to communicate with the credit services organization, except as specified.This bill would require a credit services organization to redact specified information in certain written communications. The bill would require a credit services organization to maintain certain information on file for 4 years. The bill would require the department to maintain an internet website, as specified. The bill would prescribe statutory penalties that may be imposed on a credit services organization that willfully and knowingly violates these provisions. Because the bill would change the definition of a crime, the bill would impose a state-mandated local program. The bill would authorize the department to periodically increase the amount of the fee it is authorized to charge for licensure, regulation, and oversight of licensees, but the amount of the fee would be prohibited from exceeding that which is reasonable and necessary to satisfy the departments costs in complying with its duties to license, regulate, and oversee licensees.. licensees. The bill would create the Credit Repair Services Licensing Fund, the monies in which shall be available to the department upon appropriation by the Legislature.This bill would require a consumer credit reporting agency, creditor, debt collector, or debt buyer that knows that a consumer is represented by a credit service organization, and that also has knowledge of, or can readily ascertain the credit services organizations name and address, to communicate with the credit services organization, except as specified.Existing constitutional provisions require that a statute that limits the right of access to the meetings of public bodies or the writings of public officials and agencies be adopted with findings demonstrating the interest protected by the limitation and the need for protecting that interest.This bill would make legislative findings to that effect.The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.This bill would provide that no reimbursement is required by this act for a specified reason.Digest Key Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: YES Bill TextThe people of the State of California do enact as follows:SECTION 1. Section 1789.11 of the Civil Code is amended to read:1789.11. The Legislature finds and declares that:(a) The ability to obtain and use credit has become of great importance to consumers, who have a vital interest in establishing and maintaining their credit worthiness and credit standing. As a result, consumers who have experienced credit problems may seek assistance from credit services organizations which offer to obtain credit or improve the credit standing of such consumers.Certain advertising and business practices of some credit services organizations have worked a financial hardship upon the people of this state, often those who are of limited economic means and inexperienced in credit matters. Credit services organizations have significant impact upon the economy and well-being of this state and its people.(b) The purposes of this title are to provide prospective buyers of services of credit services organizations with the information necessary to make an intelligent decision regarding the purchase of those services and to protect the public from unfair or deceptive advertising and business practices.(c) This title shall be construed liberally to achieve these purposes.(d) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 2. Section 1789.11 is added to the Civil Code, to read:1789.11. The Legislature finds and declares that:(a) The ability to obtain and use credit has become of great importance to consumers, who have a vital interest in establishing and maintaining their credit worthiness and credit standing. As a result, consumers who have experienced credit problems may seek assistance from credit services organizations which offer to obtain credit or improve the credit standing of such consumers.Certain advertising and business practices of some credit services organizations have worked a financial hardship upon the people of this state, often those who are of limited economic means and inexperienced in credit matters. Credit services organizations have significant impact upon the economy and well-being of this state and its people.(b) The purposes of this title are to license, regulate, and oversee licensees, to provide prospective consumers of services of credit services organizations with the information necessary to make an intelligent decision regarding the purchase of those services and to protect the public from unfair or deceptive advertising and business practices.(c) This title shall be construed liberally to achieve these purposes.(d) This section shall become operative on January 1, 2023.SEC. 3. Section 1789.11.1 is added to the Civil Code, to read:1789.11.1. (a) Beginning on January 1, 2022, the Department of Financial Protection and Innovation shall take all action necessary to prepare to be able, commencing on January 1, 2023, to fully enforce the licensing and regulatory provisions of this title, including, but not limited to, adoption of all necessary regulations.(b) The Department of Financial Protection and Innovation shall allow any credit services organization that submits an application for licensure before January 1, 2023, to operate pending the denial or approval of the application.SEC. 4. Section 1789.11.3 is added to the Civil Code, to read:1789.11.3. (a) No city, county, city and county, or other political subdivision within this state shall require a credit services organization to be licensed.(b) This section shall become operative on January 1, 2023.SEC. 5. Section 1789.11.5 is added to the Civil Code, to read:1789.11.5. (a) No person shall provide credit services in this state without first obtaining a license pursuant to this title. A person is acting in this state if the person is located in this state and is seeking to provide credit services to a consumer that resides inside or outside the state, or is located outside of the state and is seeking to provide credit services to a consumer that resides in this state. (b) A license shall be obtained for the licensees principal place of business and shall not be transferred or assigned.(c) A separate license is not required for each individual branch office.(d) This section shall become operative on January 1, 2023.SEC. 6. Section 1789.12 of the Civil Code is amended to read:1789.12. As used in this title:(a) Credit services organization means a person who, with respect to the extension of credit by others, sells, provides, or performs, or represents that the person can or will sell, provide or perform, any of the following services, in return for the payment of money or other valuable consideration:(1) Improving a buyers credit record, history, or rating.(2) Obtaining a loan or other extension of credit for a buyer.(3) Providing advice or assistance to a buyer with regard to either paragraph (1) or (2).(b) Credit services organization does not include any of the following:(1) Any person holding a license to make loans or extensions of credit pursuant to the laws of this state or the United States who is subject to regulation and supervision with respect to the making of those loans or extensions of credit by an official or agency of this state or the United States and whose business is the making of those loans or extensions of credit.(2) Any bank, as defined in Section 103 of the Financial Code, or any savings institution, as specified in subdivision (a) or (b) of Section 5102 of the Financial Code, whose deposits or accounts are eligible for insurance by the Federal Deposit Insurance Corporation.(3) Any person licensed as a prorater by the Department of Business Oversight when the person is acting within the course and scope of that license.(4) Any person licensed as a real estate broker performing an act for which a real estate license is required under the Real Estate Law (Part 1 (commencing with Section 10000) of Division 4 of the Business and Professions Code) and who is acting within the course and scope of that license license.(5) Any attorney licensed to practice law in this state, where the attorney renders services within the course and scope of the practice of law, unless the attorney is an employee of, or otherwise directly affiliated with, a credit services organization.(6) Any broker-dealer registered with the Securities and Exchange Commission or the Commodity Futures Trading Commission where the broker-dealer is acting within the course and scope of the regulation.(7) Any nonprofit organization described in Section 501(c)(3) of the Internal Revenue Code that, according to a final ruling or determination by the Internal Revenue Service, is both of the following:(A) Exempt from taxation under Section 501(a) of the Internal Revenue Code.(B) Not a private foundation as defined in Section 509 of the Internal Revenue Code.An advance ruling or determination of tax-exempt or foundation status by the Internal Revenue Service does not meet the requirements of this paragraph.(c) Buyer means any natural person who is solicited to purchase or who purchases the services of a credit services organization.(d) Extension of credit means the right to defer payment of debt or to incur debt and defer its payment, offered or granted primarily for personal, family, or household purposes.(e) Consumer credit reporting agency means a consumer credit reporting agency subject to the Consumer Credit Reporting Agencies Act, Title 1.6 (commencing with Section 1785.1).(f) Person includes an individual, corporation, partnership, joint venture, or any business entity.(g) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 7. Section 1789.12 is added to the Civil Code, to read:1789.12. (a) As used in this title:(1) Applicant means a person who has applied for a license pursuant to this title.(2) Commissioner means the Commissioner of the Department of Financial Protection and Innovation.(3) Communication means the conveyance of any information regarding a debt, credit record, credit history, or credit rating, directly or indirectly, to any person by any means or through any medium.(4) Consumer means any natural person who resides in California and is solicited to purchase or who purchases the services of a credit services organization.(5) Consumer credit reporting agency has the same meaning as in Section 1785.3.(6) (A) Credit services organization means a person who, with respect to the extension of credit by others, sells, provides, or performs, or represents that the person can or will sell, provide, or perform, any of the following services, in return for the payment of money or other valuable consideration:(i) Improving a consumers credit record, history, or rating.(ii) Obtaining a loan or other extension of credit for a consumer.(iii) Providing advice or assistance to a consumer with regard to either clause (i) or (ii).(B) Credit services organization does not include any of the following:(i) Any person holding a license to make loans or extensions of credit pursuant to the laws of this state or the United States who is subject to regulation and supervision with respect to the making of those loans or extensions of credit by an official or agency of this state or the United States and whose business is the making of those loans or extensions of credit.(ii) Any bank, as defined in Section 103 of the Financial Code, or any savings institution, as specified in subdivision (a) or (b) of Section 5102 of the Financial Code, whose deposits or accounts are eligible for insurance by the Federal Deposit Insurance Corporation.(iii) Any person licensed as a prorater by the Department of Financial Protection and Innovation when the person is acting within the course and scope of that license.(iv) Any person licensed as a real estate broker performing an act for which a real estate license is required under the Real Estate Law (Part 1 (commencing with Section 10000) of Division 4 of the Business and Professions Code) and who is acting within the course and scope of that license.(v) Any attorney licensed to practice law in this state, where the attorney renders services within the course and scope of the practice of law, unless the attorney is an employee of, or otherwise directly affiliated with, a credit services organization.(vi) Any broker-dealer registered with the Securities and Exchange Commission or the Commodity Futures Trading Commission where the broker-dealer is acting within the course and scope of the regulation.(vii) Any nonprofit organization described in Section 501(c)(3) of the Internal Revenue Code that, according to a final ruling or determination by the Internal Revenue Service, is both of the following:(I) Exempt from taxation under Section 501(a) of the Internal Revenue Code.(II) Not a private foundation as defined in Section 509 of the Internal Revenue Code.An advance ruling or determination of tax-exempt or foundation status by the Internal Revenue Service does not meet the requirements of this paragraph.(7) Data Furnisher has the same meaning as the term furnisher is defined in Section 660.2 of Title 16 of the Code of Federal Regulations.(8) Department means the Department of Financial Protection and Innovation.(9) Extension of credit means the right to defer payment of debt or to incur debt and defer its payment, offered or granted primarily for personal, family, or household purposes.(10) Fund means the Credit Services Organization Licensing Fund established pursuant to Section 1789.12.13.(11) Licensee means a person licensed pursuant to this chapter.(12) Nationwide Multistate Licensing System and Registry means a system of record, created by the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators, for nondepository, financial services licensing or registration in participating state agencies, the District of Colombia, Puerto Rico, the United States Virgin Islands, and Guam.(13) Person includes a natural person, corporation, partnership, limited liability company, joint venture, or any business entity.(b) This section shall become operative on January 1, 2023.SEC. 8. Section 1789.12.1 is added to the Civil Code, to read:1789.12.1. (a) The commissioner shall administer this title and may adopt rules and regulations, and issue orders, consistent with that authority.(b) Without limitation, the functions, powers, and duties of the commissioner include all of the following:(1) To issue or to refuse to issue a license as provided in this title.(2) To allow affiliated companies to be under a single license. The commissioner shall adopt regulations specifying what constitutes an affiliated company for these purposes.(3) To keep records of licenses issued under this title.(4) To receive, consider, investigate, and act upon a complaint made in connection with a licensee.(5) To prescribe the form of and to receive applications for licenses and reports, books, and records required to be made or retained by a licensee.(6) To subpoena documents and witnesses, and to compel their attendance and production, to administer oaths, and to require the production of books, papers, or other materials relevant to any inquiry authorized by this title.(7) To require information with regard to an applicant that the commissioner may deem necessary, with regard for the paramount public interest in ascertaining the experience, background, honesty, truthfulness, integrity, and competency of an applicant for providing credit services, and if an applicant is an entity other than an individual, in ascertaining the honesty, truthfulness, integrity, and competency of officers, directors, or managing members of the corporation, association, or other entity, or the general patterns of a partnership.(8) To enforce by order any provision of this title.(9) To levy fees, fines, and charges in an amount sufficient to cover the cost of the services performed in administering this title. The fees collected pursuant to this title shall not exceed the costs of administering this title.(c) This section shall become operative on January 1, 2023.SEC. 9. Section 1789.12.3 is added to the Civil Code, to read:1789.12.3. (a) The proceedings for a revocation of a license shall be conducted in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code.(b) The commissioner may suspend or revoke a license if, after notice and an opportunity for hearing, the commissioner finds any of the following:(1) The licensee violated this title or a regulation adopted or an order issued under this title.(2) The licensee does not cooperate with an examination or investigation by the commissioner.(3) The licensee is insolvent, suspends payment of its obligations, or makes a general assignment for the benefit of its creditors.(4) A receiver, liquidator, or conservator has been appointed for a licensee.(5) Any fact or condition exists that, if it had existed at the time that the licensee applied for the license, would have been grounds for denying the application.(c) This section shall become operative on January 1, 2023.SEC. 10. Section 1789.12.5 is added to the Civil Code, to read:1789.12.5. (a) Notwithstanding any law the commissioner shall have the authority to conduct investigations and examinations of an applicant or licensee as follows:(1) For purposes of determining whether an applicant is eligible for a license, or that a licensee is complying with the provisions of this title or any regulation or order of the commissioner, the commissioner may access, receive, and use any books, accounts, records, files, documents, information, or evidence that relates to the licensees credit services, including, but not limited to, any of the following relating to the intent to, or the practice of, providing credit services:(A) Criminal, civil, and administrative history information.(B) Personal history and experience information, including, but not limited to, independent credit reports obtained from a consumer reporting agency.(C) Any other documents, information, or evidence that the commissioner deems relevant to the inquiry or investigation regardless of the location, possession, control, or custody of those documents, information, or evidence.(2) For the purposes of investigating violations or complaints arising under this title, the commissioner may direct, subpoena, or order the attendance of, and examine under oath, any person whose testimony may be required about the consumer or the credit services organization.(b) In making any examination or investigation authorized by this section, the commissioner may control access to any documents and records of the licensee or person under examination or investigation. The commissioner may take possession of the documents and records or place a person in exclusive charge of the documents and records in the place where they are usually kept. During the period of control, no person shall remove or attempt to remove any of the documents and records except pursuant to a court order or with the consent of the commissioner. Unless the commissioner has reasonable grounds to believe the documents or records of a licensee have been, or are at risk of being, altered or destroyed for purposes of concealing a violation of this title, the licensee or owner of the documents and records shall have access to the documents or records as necessary to conduct their ordinary business affairs.(c) The commissioner may permit affiliated companies to be subject to a single examination. The department shall list all affiliated company names on the license and shall post them on the departments internet website.(d) This section shall become operative on January 1, 2023.SEC. 11. Section 1789.12.7 is added to the Civil Code, to read:1789.12.7. (a) If, in the opinion of the commissioner, a person who is required to be licensed under this title is engaged in the business of providing credit services without a license from the commissioner, or a person or licensee has violated any provision of this title, an order, or a regulation adopted pursuant to this title, the commissioner may do any of the following:(1) After notice and an opportunity for a hearing, order the person or licensee to desist and to refrain from engaging in the business of further continuing the violation.(2) After notice and an opportunity for a hearing, order the person or licensee to pay ancillary relief. The ancillary relief may include, but need not be limited to, refunds, restitution, disgorgement, and payment of damages, as appropriate, on behalf of a person injured by the conduct or practice that constitutes the subject matter of the assessment.(b) If, within 30 days after an order issued pursuant to subdivision (a) or (b) is served, a written request for a hearing is filed and no hearing is held within 30 days thereafter, the order shall be deemed rescinded.(c) This section shall become operative on January 1, 2023.SEC. 12. Section 1789.12.9 is added to the Civil Code, to read:1789.12.9. (a) Notwithstanding any law, the commissioner may by rule or order prescribe circumstances under which to accept electronic records or electronic signatures. This section shall not be deemed to require the commissioner to accept electronic records or electronic signatures.(b) For purposes of this section, the following terms have the following meanings:(1) Electronic record means an initial license application, or material modification of that license application, and any other record created, generated, sent, communicated, received, or stored by electronic means. Electronic record also includes, but is not limited to, all of the following electronic documents:(A) An application, amendment, supplement, and exhibit, filed for any license, consent, or other authority.(B) A financial statement, report, or advertising.(C) A surety bond, rider, or endorsement thereto.(D) An order, license, consent, or other authority.(E) A notice of public hearing, accusation, and statement of issues in connection with any application, license, consent, or other authority.(F) A proposed decision of a hearing officer and a decision of the commissioner.(G) The transcripts of a hearing and correspondence between a party and the commissioner directly relating to the record.(H) A release, newsletter, interpretive opinion, determination, or specific ruling.(I) Correspondence between a party and the commissioner directly relating to any document listed in subparagraphs (A) to (H), inclusive.(2) Electronic signature means an electronic sound, symbol, or process attached to or logically associated with an electronic record and executed or adopted by a person with the intent to sign the electronic record.(c) The Legislature finds and declares that the Department has continuously implemented methods to accept records filed electronically, and is encouraged to continue to expand its use of electronic filings to the extent feasible, as budget, resources, and equipment are made available to accomplish that goal. (d) This section shall become operative on January 1, 2023.SEC. 13. Section 1789.12.11 is added to the Civil Code, to read:1789.12.11. (a) The commissioner may require an applicant for a license to make some or all of the filings with the commissioner through the Nationwide Multistate Licensing System and Registry.(b) The commissioner may require an application to be made through the Nationwide Multistate Licensing System and Registry, and may require fees, fingerprints, financial statements, supporting documents, changes of address, and any other information, and amendments or modifications thereto, to be submitted by applicants and licensees through the Nationwide Multistate Licensing System and Registry.(c) The commissioner may require licensees to pay annual fees through the Nationwide Multistate Licensing System and Registry.(d) This section shall become operative on January 1, 2023.SEC. 14. Section 1789.12.13 is added to the Civil Code, to read:1789.12.13. (a) The Credit Services Licensing Fund is hereby established within the state treasury.(b) All licensing fees collected shall be deposited into the Fees Account which is hereby established within the fund.(c) All fines and penalties collected shall be deposited into the Penalties Account which is hereby established within the fund.(d) All monies deposited into the fund shall be available to the commissioner, upon appropriation by the Legislature, for the purposes of this title. (e) This section shall become operative on January 1, 2023.SEC. 15. Section 1789.12.15 is added to the Civil Code, to read:1789.12.15. An applicant shall apply for a license by submitting all of the following to the commissioner:(a) A completed application for a license in a form prescribed by the commissioner and signed under penalty of perjury. Every application shall include the location of the applicants principal place of business and all branch office locations.(b) An application fee and investigation fee, the amount of which shall be determined by the department, to cover any costs incurred in processing an application, including a fingerprint processing and criminal history record check under Section 1789.12.7. The investigation fee, including the amount for the criminal history record check, and the application fee are not refundable if an application is denied or withdrawn.(c) This section shall become operative on January 1, 2023.SEC. 16. Section 1789.12.17 is added to the Civil Code, to read:1789.12.17. (a) The commissioner shall submit to the Department of Justice fingerprint images and related information required by the Department of Justice of every applicant, as defined in paragraph (1) of subdivision (a) of Section 1789.12, for purposes of obtaining information as to the existence and content of a record of state or federal convictions, state or federal arrests, and information as to the existence and content of a record of state or federal arrests for which the Department of Justice establishes that the person is free on bail or on their own recognizance pending trial or appeal.(b) When received, the Department of Justice shall transmit fingerprint images and related information received pursuant to this section to the Federal Bureau of Investigation for the purpose of obtaining a federal criminal history records check. The Department of Justice shall review the information returned from the Federal Bureau of Investigation and compile and disseminate a response to the commissioner.(c) The Department of Justice shall provide a state or federal response to the commissioner pursuant to paragraph (1) of subdivision (p) of Section 11105 of the Penal Code.(d) The commissioner shall request from the Department of Justice subsequent arrest notification service, as provided pursuant to Section 11105.2 of the Penal Code, for the license applicant described in subdivision (a).(e) The Department of Justice shall charge a fee, payable by the applicant, sufficient to cover the costs of processing the requests pursuant to this section.(f) This section shall become operative on January 1, 2023.SEC. 17. Section 1789.12.19 is added to the Civil Code, to read:1789.12.19. (a) (1) Upon the filing of an application for a license pursuant to Section 1789.25 and the payment of the fees, if the applicant is a partnership, the commissioner shall investigate the applicant and its general partners and individuals owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or any individual responsible for the conduct of the applicants servicing activities in this state.(2) Upon the filing of an application for a license pursuant to Section 1789.25 and the payment of the fees, if the applicant is a corporation, trust, limited liability company, or association, including an unincorporated organization, the commissioner shall investigate the applicant, its principal officers, directors, trustee, managing members, and individuals owning or controlling, directly or indirectly, 10 percent or more of the outstanding equity securities or any individual responsible for the conduct of the applicants credit services in this state.(b) Upon the filing of an application for a license pursuant to Section 1789.25 and the payment of the fees, the commissioner shall investigate the individual responsible for the credit services of the licensee at the location described in the application. The investigation may be limited to information that was not included in prior applications filed pursuant to this title.(c) For the purposes of this section, principal officers shall mean president, chief executive officer, treasurer, and chief financial officer, as may be applicable, and any other officer with direct responsibility for the conduct of the applicants credit services in this state.(d) This section shall become operative on January 1, 2023.SEC. 18. Section 1789.12.21 is added to the Civil Code, to read:1789.12.21. (a) When the application is complete, including the information from the Department of Justice, and the commissioner determines that the applicant has satisfied the requirements set forth in this title and does not find facts constituting reasons for denial, the commissioner shall issue and deliver a license to the applicant.(b) If the commissioner determines that the requirements have not been satisfied, after notice and an opportunity for a hearing, the commissioner may deny the application and shall provide a written explanation for the denial.(c) This section shall become operative on January 1, 2023.SEC. 19. Section 1789.12.23 is added to the Civil Code, to read:1789.12.23. (a) The proceedings for a denial of a license shall be conducted in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code.(b) After notice and an opportunity for a hearing, the commissioner may deny an application for a license for any of the following reasons:(1) A false statement of a material fact has been made in the application.(2) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, within the last 10 years has (A) been convicted of, or pleaded nolo contendere to, a crime, other than traffic violations, or (B) committed any act involving dishonesty, fraud, or deceit, if the crime or act is substantially related to the qualifications, functions, or duties of a person engaged in business in accordance with this title.(3) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, has violated, or is not in material compliance with this title, or an order or rule of the commissioner.(4) A material requirement for issuance of a license has not been met, provided that a written notice of a material omission shall first be sent to the applicant with an opportunity to correct the omission prior to the applicants denial.(5) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, has violated this title or the rules thereunder, or any similar regulatory scheme of this or a foreign jurisdiction.(6) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, has been held liable by final judgment in a civil action under this title.(7) The commissioner, based on its investigation of the applicant, is unable to find that the financial responsibility, criminal records, experience, character, and general fitness of the applicant and its general partners, managing members, principal officers and directors, and individuals owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, support a finding that the business will be operated honestly, fairly, efficiently, and in accordance with the requirements of this title.(8) The commissioner may adopt regulations specifying the factors that the commissioner will consider in denying a license, including, but not limited to, the harm to the consumer, the frequency of prior violations, and the number of prior disciplinary actions taken against the licensee in California or in other states.(c) This section shall become operative on January 1, 2023.SEC. 20. Section 1789.12.25 is added to the Civil Code, to read:1789.12.25. (a) The commissioner may deem an application for a license abandoned if the applicant fails to respond to any request for information required by the commissioner or department during an investigation of the application.(b) The commissioner shall notify the applicant, in writing, that if the applicant fails to submit responsive information within 60 days from the date the commissioner sent the written request for information, the commissioner shall deem the application abandoned.(c) An application fee paid prior to the date an application is deemed abandoned shall not be refunded. Abandonment of an application pursuant to this subdivision shall not preclude the applicant from submitting a new application and fee for a license.(d) This section shall become operative on January 1, 2023.SEC. 21. Section 1789.12.27 is added to the Civil Code, to read:1789.12.27. (a) A license shall remain effective until the license is either suspended or revoked by the commissioner or surrendered by the licensee.(b) This section shall become operative on January 1, 2023.SEC. 22. Section 1789.12.29 is added to the Civil Code, to read:1789.12.29. (a) The commissioner is authorized to establish relationships or contracts with the Nationwide Multistate Licensing System and Registry or other entities designated by the Nationwide Multistate Licensing System and Registry to collect and maintain records and process transaction fees or other fees related to licensees or other persons subject to this title.(b) For the purpose of participating in the Nationwide Multistate Licensing System and Registry, the commissioner is authorized to waive or modify, in whole or in part, by rule, regulation, or order, any or all of the requirements of this title and to establish new requirements as reasonably necessary to participate in the Nationwide Multistate Licensing System and Registry.(c) The commissioner may use the Nationwide Multistate Licensing System and Registry as a channeling agent for requesting information from, and distributing information to, the Department of Justice, any other governmental agency, or any other source, as directed by the commissioner.(d) The commissioner shall establish a process through which applicants and licensees may challenge information entered into the Nationwide Multistate Licensing System and Registry by the commissioner.(e) This section shall become operative on January 1, 2023.SEC. 23. Section 1789.12.31 is added to the Civil Code, to read:1789.12.31. (a) Except as otherwise provided in Section 1512 of the SAFE Act (12 U.S.C. Sec. 5111(a)), the requirements under any federal law or the Information Practices Act of 1977 (Chapter 1 (commencing with Section 1798) of Part 4 of Division 3 of the Civil Code) regarding the privacy or confidentiality of any information or material provided to the Nationwide Multistate Licensing System and Registry, and any privilege arising under federal or state law, including the rules of any state court, with respect to that information or material, shall continue to apply to the information or material after the information or material has been disclosed to the Nationwide Multistate Licensing System and Registry. The information and material may be shared with all state and federal regulatory officials with industry oversight authority without the loss of privilege or the loss of confidentiality protections provided by federal law or the Information Practices Act.(b) Information or material that is subject to a privilege or confidentiality under subdivision (a) shall not be subject to any of the following:(1) Disclosure under any federal or state law governing the disclosure to the public of information held by an officer or an agency of the federal government or the state.(2) Subpoena or discovery, or admission into evidence, in any private civil action or administrative process, unless with respect to any privilege held by the Nationwide Multistate Licensing System and Registry with respect to the information or material, the person to whom the information or material pertains waives, in whole or in part, in the discretion of that person, that privilege.(c) This section shall not apply with respect to the information or material relating to the employment history of, and publicly adjudicated disciplinary and enforcement actions included in, the Nationwide Multistate Licensing System and Registry for access by the public.(d) This section shall become operative on January 1, 2023.SEC. 24. Section 1789.12.33 is added to the Civil Code, to read:1789.12.33. (a) The commissioner shall report regularly violations of this title, as well as enforcement actions and other relevant information, to the Nationwide Multistate Licensing System and Registry, to the extent that the information is a public record.(b) This section shall become operative on January 1, 2023.SEC. 25. Section 1789.12.35 is added to the Civil Code, to read:1789.12.35. (a) A licensee shall notify the commissioner, in writing, of any change in the information provided in the application for a license, as applicable, not later than 30 days after the occurrence of the event that results in the information becoming inaccurate or incomplete.(b) (1) If a licensee seeks to change its place of business to a street address other than that designated in its license, the licensee shall provide written notice to the commissioner at least 10 days prior to the change.(2) A licensee shall not engage in the business of credit services at a new location in a name other than a name approved by the commissioner.(3) A licensee that opens a new branch office or changes the location of an existing branch office shall notify the commissioner in writing of the new or changed branch office location within 30 days after the branch office begins business.(c) This section shall become operative on January 1, 2023.SEC. 26. Section 1789.12.37 is added to the Civil Code, to read:1789.12.37. A licensee shall do all of the following:(a) Develop policies and procedures reasonably intended to promote compliance with this title.(b) File with the commissioner any report required by the commissioner.(c) Comply with the provisions of this title and any regulation or order of the commissioner.(d) Submit to periodic examination by the commissioner as required by this title and any regulation or order of the commissioner.(e) Maintain a surety bond in accordance with this section in a minimum amount of twenty-five thousand dollars ($25,000). The bond shall be payable to the commissioner and issued by an insurer authorized to do business in this state. The surety bond, including any and all riders and endorsements executed subsequent to the effective date of the bond, shall be filed with the commissioner within 10 days of execution. The bond shall be used for the recovery of expenses, fines, and fees levied by the commissioner in accordance with this title. The commissioner may require licensees to submit bonds, riders, and endorsements electronically through the Nationwide Multistate Licensing System and Registrys electronic surety bond function.(1) When an action is commenced on a licensees bond, the commissioner may require the filing of a new bond. Immediately upon recovery of any action on the bond, the licensee shall file a new bond. Failure to file a new bond within 10 days of the recovery on a bond, or within 10 days after notification by the commissioner that a new bond is required, constitutes sufficient grounds for the suspension or revocation of the license. A licensee may provide the commissioner a refundable deposit in the amount of twenty-five thousand dollars ($25,000) in lieu of the bond while the licensee pursues a new bond.(2) The commissioner may require a higher bond amount for a licensee based on the number of affiliates under the license and the dollar amount of credit services performed by that licensee.(f) This section shall become operative on January 1, 2023.SEC. 27. Section 1789.12.39 is added to the Civil Code, to read:1789.12.39. (a) Each licensee shall pay to the commissioner its pro rata share of all costs and expenses reasonably incurred in the administration of this title, as estimated by the commissioner, for the ensuing year and any deficit actually incurred or anticipated in the administration of the title in the year in which the annual fee is levied. The pro rata share shall be based upon the proportion of net proceeds generated by California debtor accounts in the preceding year after the amount levied pursuant to subdivision (c).(b) On or before September 30 in each year, the commissioner shall notify each licensee of the amount of the annual fee schedule that will take effect on January 1. If payment is not made by January 1, the commissioner shall assess and collect a penalty, in addition to the fee, of 1 percent of the assessment for each month or part of a month that the payment is delayed or withheld.(c) In the levying and collection of the annual fees, a licensee shall neither be charged for nor be permitted to pay less than two hundred fifty dollars ($250) nor more than an aggregate of all reasonable costs to operate this title, with the exception of fees associated with investigations and examinations.(d) If a licensee fails to pay the annual fees on or before January 1, the commissioner may by order summarily suspend or revoke the license issued to the licensee. If, after an order is made, a request for hearing is filed in writing within 30 days, and a hearing is not held within 60 days thereafter, the order is deemed rescinded as of its effective date. During any period when the license is revoked or suspended, a licensee shall not engage in the business of credit services in this state pursuant to this title except as may be permitted by order of the commissioner. However, the revocation, suspension, or surrender of a license shall not affect the powers of the commissioner as provided in this title.(e) Notwithstanding subdivisions (a) to (d), inclusive, the commissioner may by rule require licensees to pay annual fees through the Nationwide Multistate Licensing System and Registry.(f) This section shall become operative on January 1, 2023.SEC. 28. Section 1789.12.41 is added to the Civil Code, to read:1789.12.41. (a) A licensee shall file an annual report with the commissioner, on or before March 15, that contains all relevant information that the commissioner reasonably requires concerning the business and operations conducted by the licensee in the state during the preceding calendar year, including information regarding credit services activity. The report shall, at minimum, require disclosure of all of the following information:(1) The total number of California consumers provided credit services in the preceding year.(2) The total dollar amount of credit services provided in the preceding year.(3) The face value dollar amount of credit services provided in the licensees portfolio in the preceding year.(4) The total dollar amount of California credit services provided in the preceding year, and the total dollar amount of outstanding debt that remains uncollected.(5) The total dollar amount of net proceeds generated by California consumers provided credit services in the preceding year.(6) The case number of any action in which the licensee was held liable by final judgment under this title.(b) The individual annual reports filed pursuant to this section shall be made available to the public for inspection.(c) The report shall be made under oath and in the form prescribed by the commissioner.(d) A licensee shall make other special reports that may be required by the commissioner.(e) This section shall become operative on January 1, 2023.SEC. 29. Section 1789.12.43 is added to the Civil Code, to read:1789.12.43. (a) A licensee that ceases to engage in providing credit services shall inform the commissioner in writing and surrender the license and all other indicia of license to the commissioner.(b) This section shall become operative on January 1, 2023.SEC. 30. Section 1789.12.45 is added to the Civil Code, to read:1789.12.45. (a) As often as the commissioner deems necessary and appropriate, the commissioner shall examine the affairs of each licensee for compliance with this title. The commissioner shall appoint suitable persons to perform the examination. The commissioner and their appointees may examine the books, records, and documents of the licensee, and may examine the licensees officers, directors, employees, or agents under oath regarding the licensees credit services.(b) The commissioner may cooperate with any agency of the state, the federal government, or other states in performing license examinations.(c) This section does not require the commissioner to conduct examinations at the business offices of licensees. Unless an onsite examination is considered necessary for the protection of the public, the commissioner may conduct some or all examinations without a site visit to the business office of a licensee, by requesting that licensees submit required books and records to the department electronically, via a secure portal.(d) Unless otherwise exempt pursuant to subparagraph (B) of paragraph (6) or subdivision (a) of Section 1789.12, affiliates of a licensee are subject to examination by the commissioner on the same terms as the licensee, but only when reports from, or examination of, a licensee provides documented evidence of unlawful activity between a licensee and affiliate benefitting, affecting, or arising from the activities regulated by this title.(e) The cost of each examination of a licensee shall be paid to the commissioner by the licensee examined, and the commissioner may maintain an action for the recovery of the cost in any court of competent jurisdiction. In determining the cost of the examination, the commissioner may use the estimated average hourly cost for all persons performing examinations of licensees or other persons subject to this title for the fiscal year.(f) The statement of the findings of an examination shall belong to the commissioner and shall not be disclosed to anyone other than the licensee, law enforcement officials, or other state or federal regulatory agencies for further investigation and enforcement. Reports required of licensees by the commissioner under this title and results of examinations performed by the commissioner under this title are the property of the commissioner.(g) The commissioner shall provide a written statement of the findings of the examination, issue a copy of that statement to the licensee and take appropriate steps to ensure correction of any violations of this title.(h) Notwithstanding any provision of this title, the commissioner shall have the authority to waive one or more branch office examinations, if the commissioner deems that the branch office examinations are not necessary for the protection of the public, due to the centralized operations of the licensee or other factors acceptable to the commissioner.(i) In any proceeding under this title, the burden of proving an exemption or an exception from a definition is upon the person claiming it.(j) This section shall become operative on January 1, 2023.SEC. 31. Section 1789.13 of the Civil Code is amended to read:1789.13. A credit services organization and its salespersons, agents, representatives, and independent contractors who sell or attempt to sell the services of a credit services organization shall not do any of the following:(a) Charge or receive any money or other valuable consideration prior to full and complete performance of the services the credit services organization has agreed to perform for or on behalf of the buyer.(b) Fail to perform the agreed services within six months following the date the buyer signs the contract for those services.(c) Charge or receive any money or other valuable consideration for referral of the buyer to a retail seller or other credit grantor who will or may extend credit to the buyer, if either of the following apply:(1) The credit that is or will be extended to the buyer (A) is upon substantially the same terms as those available to the general public or (B) is upon substantially the same terms that would have been extended to the buyer without the assistance of the credit services organization.(2) The money or consideration is paid by the credit grantor or is derived from the buyers payments to the credit grantor for costs, fees, finance charges, or principal.(d) Make, or counsel or advise a buyer to make, a statement that is untrue or misleading and that is known, or that by the exercise of reasonable care should be known, to be untrue or misleading, to a consumer credit reporting agency or to a person who has extended credit to a buyer or to whom a buyer is applying for an extension of credit, such as statements concerning a buyers identification, home address, creditworthiness, credit standing, or credit capacity.(e) Remove, or assist or advise the buyer to remove, adverse information from the buyers credit record which is accurate and not obsolete.(f) Create, or assist or advise the buyer to create, a new credit record by using a different name, address, social security number, or employee identification number.(g) Make or use untrue or misleading representations in the offer or sale of the services of a credit services organization, including either of the following:(1) Guaranteeing or otherwise stating that the organization is able to delete an adverse credit history, unless the representation clearly discloses, in a manner equally as conspicuous as the guarantee, that this can be done only if the credit history is inaccurate or obsolete and is not claimed to be accurate by the creditor who submitted the information.(2) Guaranteeing or otherwise stating that the organization is able to obtain an extension of credit, regardless of the buyers previous credit problems or credit history, unless the representation clearly discloses, in a manner equally as conspicuous as the guarantee, the eligibility requirements for obtaining an extension of credit.(h) Engage, directly or indirectly, in an act, practice, or course of business that operates or would operate as a fraud or deception upon a person in connection with the offer or sale of the services of a credit services organization.(i) Advertise or cause to be advertised, in any manner, the services of the credit services organization, without being registered with the Department of Justice.(j) Fail to maintain an agent for service of process in this state.(k) Transfer or assign its certificate of registration.(l) Submit a buyers dispute to a consumer credit reporting agency without the buyers knowledge.(m) Use a consumer credit reporting agencys telephone system or toll-free telephone number to represent the caller as the buyer in submitting a dispute of a buyer or requesting disclosure without prior authorization of the buyer.(n) Directly or indirectly extend credit to a buyer.(o) Refer a buyer to a credit grantor that is related to the credit services organization by a common ownership, management, or control, including a common owner, director, or officer.(p) Refer a buyer to a credit grantor for which the credit services organization provides, or arranges for a third party to provide, services related to the extension of credit such as underwriting, billing, payment processing, or debt collection.(q) Provide a credit grantor with an assurance that a portion of an extension of credit to a buyer referred by the credit services organization will be repaid, including providing a guaranty, letter of credit, or agreement to acquire a part of the credit grantors financial interest in the extension of credit.(r) Use a scheme, device, or contrivance to evade the prohibitions contained in this section.(s) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 32. Section 1789.13 is added to the Civil Code, to read:1789.13. (a) A credit services organization and its salespersons, agents, representatives, and independent contractors who sell or attempt to sell the services of a credit services organization shall not do any of the following:(1) Charge or receive any money or other valuable consideration prior to full and complete performance of the services the credit services organization has agreed to perform for or on behalf of the consumer.(2) Fail to perform the agreed services within 180 days following the date the consumer signs the contract for those services.(3) Fail to provide an itemized a monthly statement to the consumer showing each service performed, including each call or written communication, and credit check made or sent on behalf of the consumer, and the date of each such service. detailing the services performed.(4) Fail to include in any written or digital communication to a consumer the California license number of the credit services organization in at least 12-point type.(5) Charge or receive any money or other valuable consideration for referral of the consumer to a retail seller or other credit grantor who will or may extend credit to the consumer, if either of the following apply:(A) The credit that is or will be extended to the consumer (i) is upon substantially the same terms as those available to the general public or (ii) is upon substantially the same terms that would have been extended to the consumer without the assistance of the credit services organization.(B) The money or consideration is paid by the credit grantor or is derived from the consumers payments to the credit grantor for costs, fees, finance charges, or principal.(6) Make, or counsel or advise a consumer to make, a statement that is untrue or misleading and that is known, or that by the exercise of reasonable care should be known, to be untrue or misleading, to a consumer credit reporting agency or to a person who has extended credit to a consumer, to a data furnisher, or to any person with whom a consumer is applying for an extension of credit, such as statements concerning a consumers identification, home address, creditworthiness, credit standing, or credit capacity.(7) Seek to remove, or assist or advise the consumer to remove or seek to remove, adverse information from the consumers credit record that is known to the credit services organization or that by the exercise of reasonable care should be known to the credit services organization to be accurate and not obsolete.(8) Create, or assist or advise the consumer to create, a new credit record by using a different name, address, social security number, or employee identification number.(9) Make or use untrue or misleading representations in the offer or sale of the services of a credit services organization, including either of the following:(A) Guaranteeing or otherwise stating that the credit services organization is able to delete an adverse credit history, unless the representation clearly discloses, in a manner equally as conspicuous as the guarantee, that this can be done only if the credit history is inaccurate or obsolete and is not claimed to be accurate by the creditor who submitted the information.(B) Guaranteeing or otherwise stating that the credit services organization is able to obtain an extension of credit, regardless of the consumers previous credit problems or credit history, unless the representation clearly discloses, in a manner equally as conspicuous as the guarantee, the eligibility requirements for obtaining an extension of credit.(10) Engage, directly or indirectly, in an act, practice, or course of business that operates or would operate as a fraud or deception upon a person in connection with the offer or sale of the services of a credit services organization.(11) Advertise or cause to be advertised, in any manner, the services of the credit services organization, without being registered with the Department of Financial Protection and Innovation.(12) Fail to maintain an agent for service of process in this state.(13) Transfer or assign its license.(14) Call or submit any communication to a consumer credit reporting agency, creditor, debt collector, or debt buyer without the prior written authorization of the consumer. A relevant authorization in the agreement or contract between a consumer and a credit services organization is sufficient for the purposes of this paragraph.(15)Call or submit any communication to a consumer reporting agency, creditor, debt collector, or debt buyer impersonating a consumer and failing to identify when the communication originates from the credit services organization. (16)(15) Submit a consumers dispute to a consumer credit reporting agency, creditor, debt collector, or debt buyer more than 180 days after the account subject to the dispute has been removed.(17)(16) Use the online electronic portal, electronic email system, or telephone system of a credit reporting agency, creditor, debt collector, or debt buyer to submit a dispute of a consumer or to request disclosure without the prior written authorization of the consumer. A relevant authorization in the agreement or contract between a consumer and a credit services organization is sufficient for the purposes of this paragraph.(18)(17) Directly or indirectly extend credit to a consumer.(19)(18) Refer a consumer to a credit grantor that is related to the credit services organization by a common ownership, management, or control, including a common owner, director, or officer.(20)(19) Refer a consumer to a credit grantor for which the credit services organization provides, or arranges for a third party to provide, services related to the extension of credit such as underwriting, billing, payment processing, or debt collection.(21)(20) Provide a credit grantor with an assurance that a portion of an extension of credit to a consumer referred by the credit services organization will be repaid, including providing a guaranty, letter of credit, or agreement to acquire a part of the credit grantors financial interest in the extension of credit.(22)(21) Use a scheme, device, or contrivance to evade the prohibitions contained in this section.(23)(22) Send any communication, directly or indirectly, to any person on behalf of a consumer without disclosing the senders identity, street address, telephone number, and facsimile number, and, if applicable, the name and street address of any parent organization of sender.(24)Send(23) Ensure that any written communication sent on behalf of a consumer to any person other than the consumer without providing a copy of the communication to the consumer within five days thereafter. is available to the consumer through the online portal.(25)(24) Fail to provide along with its first written communication to a credit reporting agency or data furnisher sufficient information to investigate a dispute of an account, including, but not limited to any pertinent information and copies of any documents that are available to it concerning the disputed item.(b) This section shall become operative on January 1, 2023.SEC. 33. Section 1789.134 is added to the Civil Code, to read:1789.134. (a) A consumer credit reporting agency, creditor, debt collector, or debt buyer that knows that a consumer is represented by a credit services organization pursuant to a power of attorney, organization, and that also has knowledge of, or can readily ascertain the credit services organizations name and address shall communicate with the credit services organization unless either of the following circumstances apply:(1) The credit services organization fails to respond within a reasonable period of time 30 days to a communication from a consumer credit reporting agency, creditor, debt collector, or debt buyer.(2) The consumer expressly directs the consumer credit reporting agency, creditor, debt collector, or debt buyer not to communicate with the credit services organization.(b) Notwithstanding subdivision (a), a consumer credit reporting agency, creditor, or debt collector shall not be required to communicate with a credit services organization concerning an account that is subject to a dispute if any of the following apply:(1) The account subject to the dispute has been paid, settled, or otherwise resolved and has been reported as paid, settled, or otherwise resolved on the consumers credit report.(2) The account subject to the dispute has been removed from the consumers credit report.(3) The debt collector has provided to the credit services organization or to the consumer the verification information or documentation described in Section 1692g(b) of Title 15 of the United States Code regarding the account subject to dispute.(4) The debt buyer has provided to the credit services organization or to the consumer the information or documentation described in subdivisions (a) and (b) of Section 1788.52 regarding the account subject to the dispute.(5) The consumer credit reporting agency, creditor, or debt collector reasonably determines that the dispute is frivolous or irrelevant pursuant to Section 1681i(a)(3) or Section 1681s-2(a)(1)(F) of Title 15 of the United States Code. (c) This section shall become operative on January 1, 2023.SEC. 34. Section 1789.135 is added to the Civil Code, to read:1789.135. (a) To protect against fraud and identity theft, when a credit services organization sends a written communication by facsimile, electronic mail, United States mail, overnight courier, or other means that contains personal information of a consumer, the credit services organization shall redact the personal information to include only the last four digits of the social security number, taxpayer identification number, or state identification number, the last four digits of the financial account number, credit card number, or debit card number, or the month and year of the consumers date of birth, unless the inclusion of the full number or date is otherwise required by law, or is legally permissible and required to achieve the desired objective. Redacting information pursuant to this subdivision shall not be considered a violation of paragraph (24) of subdivision (a) of Section 1789.13.(b) This section shall become operative on January 1, 2023.SEC. 35. Section 1789.14 of the Civil Code is amended to read:1789.14. (a) Before the execution of a contract or agreement between the buyer and a credit services organization, the credit services organization shall provide the buyer a statement in writing, containing all the information required by Section 1789.15. The credit services organization shall maintain on file or microfilm for a period of two years an exact copy of the statement, personally signed by the buyer, acknowledging receipt of a copy of the statement.(b) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 36. Section 1789.14 is added to the Civil Code, to read:1789.14. (a) Before the execution of a contract or agreement between the consumer and a credit services organization, the credit services organization shall provide the consumer a statement in writing containing all the information required by Section 1789.15. The credit services organization shall maintain on file for a period of four years following the completion or termination of the credit services organization agreement with the consumer an exact copy of the statement, personally signed by the consumer, acknowledging receipt of a copy of the statement.(b) This section shall become operative on January 1, 2023.SEC. 37. Section 1789.15 of the Civil Code is amended to read:1789.15. (a) The information statement shall include all of the following:(1) A complete and detailed description of the services to be performed by the credit services organization for or on behalf of the buyer and the total amount the buyer will have to pay, or become obligated to pay, for the services.(2) The buyers right to proceed against the bond under the circumstances and in the manner set forth in Section 1789.18.(3) The name and address of the surety company which issued the bond.(4) A complete and accurate statement of the availability of nonprofit credit counseling services.The information statement shall be printed in at least 10-point boldface type and shall include the following statement or any substantially equivalent alternative that is approved by the Department of Justice:CONSUMER CREDIT FILE RIGHTS UNDER STATE AND FEDERAL LAWYou have a right to obtain a copy of your credit file from a consumer credit reporting agency. You may be charged a reasonable fee not exceeding eight dollars ($8). There is no fee, however, if you have been turned down for credit, employment, insurance, or a rental dwelling because of information in your credit report within the preceding 60 days. The consumer credit reporting agency must provide someone to help you interpret the information in your credit file.You have a right to dispute inaccurate information by contacting the consumer credit reporting agency directly. However, neither you nor any credit repair company or credit services organization has the right to have accurate, current, and verifiable information removed from your credit report. Under the Federal Fair Credit Reporting Act, the consumer credit reporting agency must remove accurate, negative information from your report only if it is over seven years old. Bankruptcy information can be reported for 10 years.If you have notified a credit reporting agency in writing that you dispute the accuracy of information in your credit file, the consumer credit reporting agency must then reinvestigate and modify or remove inaccurate information. The consumer credit reporting agency may not charge a fee for this service. Any pertinent information and copies of all documents you have concerning an error should be given to the consumer credit reporting agency.If reinvestigation does not resolve the dispute to your satisfaction, you may send a brief statement to the consumer credit reporting agency to keep in your file, explaining why you think the record is inaccurate. The consumer credit reporting agency must include your statement about disputed information in any report it issues about you.You have a right to cancel the contract for any reason within five working days from the date you signed it. If for any reason you do cancel the contract during this time, you do not owe any money.You have a right to sue a credit services organization if it misleads you.(b) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 38. Section 1789.15 is added to the Civil Code, to read:1789.15. (a) The information statement shall include all of the following:(1) A complete and detailed description of the services to be performed by the credit services organization for or on behalf of the consumer and the total amount the consumer will have to pay, or become obligated to pay, for the services.(2) The consumers right to proceed against the bond under the circumstances and in the manner set forth in Section 1789.18.(3) The name and address of the surety company which issued the bond.(4) A complete and accurate statement of the availability of nonprofit credit counseling services.(5) The following notice: If you have a complaint about the services provided by this credit services organization or the fees charged by this credit services organization, you may submit that complaint to the Department of Financial Protection and Innovation at www.dfpi.ca.gov, or the Attorney Generals office, California Department of Justice, Attn: ____, P.O. Box 944255, Sacramento, CA 94244-2550.The information statement shall be printed in at least 10-point boldface type and shall include the following statement:CONSUMER CREDIT FILE RIGHTS UNDER STATE AND FEDERAL LAWYou have a right to obtain a free copy of your credit report from a credit reporting agency. You may obtain this free copy of your credit report one time per year by visiting www.AnnualCreditReport.com. You will be able to view your credit report, dispute alleged inaccuracies, and obtain additional information at no fee. If requested, the consumer credit reporting agency must provide someone to help you interpret the information in your credit file.You have a right to dispute inaccurate information by contacting the consumer credit reporting agency directly. However, neither you nor any credit repair company or credit services organization has the right to have accurate, current, and verifiable information removed from your credit report. Under the Federal Fair Credit Reporting Act, the consumer credit reporting agency must remove accurate, negative information from your report only if it is over seven years old. Bankruptcy information can be reported for 10 years.If you have notified a credit reporting agency in writing that you dispute the accuracy of information in your credit file, the consumer credit reporting agency must then reinvestigate and modify or remove inaccurate information. The consumer credit reporting agency may not charge a fee for this service. Any pertinent information and copies of all documents you have concerning an error should be given to the consumer credit reporting agency.If the reinvestigation does not resolve the dispute to your satisfaction, you may send a brief statement to the consumer credit reporting agency to keep in your file, explaining why you think the record is inaccurate. The consumer credit reporting agency must include your statement about disputed information in any report it issues about you.You have a right to cancel the contract with the credit services organization for any reason before midnight on the fifth working day after you signed it. If for any reason you cancel the contract during this time, you do not owe any money.You have a right to sue a credit services organization if it misleads you.(b) This section shall become operative on January 1, 2023.SEC. 39. Section 1789.16 of the Civil Code is amended to read:1789.16. (a) A credit services organization shall not provide any service to a buyer except pursuant to a written contract that complies with this section. Every contract between the buyer and a credit services organization for the purchase of the services of the credit services organization shall be in writing, shall be dated, signed by the buyer, and include all of the following:(1) A conspicuous statement in size equal to at least 10-point boldface type, in immediate proximity to the space reserved for the signature of the buyer, as follows:You, the buyer, may cancel this contract at any time prior to midnight of the fifth day after the date of the transaction. See the attached notice of cancellation form for an explanation of this right.(2) The terms and conditions of payment, including the total of all payments to be made by the buyer, whether to the credit services organization or to some other person.(3) A full and detailed description of the services to be performed by the credit services organization for the buyer, including all guarantees and all promises of full or partial refunds, and the estimated date by which the services are to be performed, or the estimated length of time for performing the services not to exceed six months or a shorter period consistent with the purposes of this title as may be prescribed by the Department of Justice.(4) The credit services organizations principal business address and the name and address of its agent, other than the Secretary of State, in the State of California, authorized to receive service of process.(b) The contract shall be accompanied by a completed form in duplicate, captioned Notice of Cancellation, which shall be attached to the contract and easily detachable, and which shall contain in type of at least 10-point the following statement written in the same language as used in the contract:Notice of CancellationYou may cancel this contract, without any penalty or obligation, within five days from the date the contract is signed.If you cancel, any payment made by you under this contract must be returned within 15 days following receipt by the seller of your cancellation notice.To cancel this contract, mail or deliver a signed and dated copy of this cancellation notice, or any other written notice, to _____ (name of seller) _____ at _____ (address of seller)(place of business) _____ not later than midnight (date).I hereby cancel this transaction.(date) _____ (purchasers signature) _____ A copy of the fully completed contract and all other documents the credit services organization requires the buyer to sign shall be given to the buyer at the time they are signed.(c) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 40. Section 1789.16 is added to the Civil Code, to read:1789.16. (a) A credit services organization shall not provide any service to a consumer except pursuant to a written contract that complies with this section. Every contract between the consumer and a credit services organization for the purchase of the services of the credit services organization shall identify the physical address, electronic mail address, and facsimile number if applicable, of the credit services organization, shall be in writing, shall be dated, shall be signed by the consumer, and shall include all of the following:(1) A conspicuous statement in size equal to at least 10-point boldface type, in immediate proximity to the space reserved for the signature of the buyer, as follows:You, the consumer, may cancel this contract at any time before midnight on the fifth working day after you sign it. See the attached notice of cancellation form for an explanation of this right.(2) The terms and conditions of payment, including the total of all payments to be made by the consumer, whether to the credit services organization or to some other person.(3) A full and detailed description of the services to be performed by the credit services organization for the consumer, including a list of the inaccurate or obsolete adverse information appearing on the consumers credit report which the credit services organization will seek to delete or modify, the basis for the deletion or modification, and, if applicable, a description of each modification sought and the anticipated payment required by the consumer to achieve each account deletion or modification, all guarantees and all promises of full or partial refunds, and the estimated date by which the services are to be performed, or the estimated length of time for performing the services, not to exceed 180 days, or a shorter period consistent with the purposes of this title as may be prescribed by the Department of Financial Protection and Innovation.(4) The credit services organizations principal business address and the name and address of its agent, other than the Secretary of State, in the State of California, authorized to receive service of process.(b) The contract shall be accompanied by a completed form in duplicate, captioned Notice of Cancellation, which shall be attached to the contract and easily detachable, and which shall contain in type of at least 10-point the following statement written in the same language as used in the contract:Notice of CancellationYou may cancel this contract, without any penalty or obligation, before midnight on the fifth working day after you sign it.If you cancel, any payment made by you under this contract must be returned within 15 days following receipt by the seller of your cancellation notice.To cancel this contract, mail or deliver a signed and dated copy of this cancellation notice, or any other written notice, to _____ (name of seller) _____ at _____ (address of seller)(place of business) _____ not later than midnight (date).I hereby cancel this transaction.(date) _____ (purchasers signature) _____ A copy of the fully completed contract and all other documents the credit services organization requires the buyer to sign shall be given to the consumer at the time they are signed.(c) This section shall become operative on January 1, 2023.SEC. 41. Section 1789.19 of the Civil Code is amended to read:1789.19. (a) Any waiver by a buyer of the provisions of this title shall be deemed contrary to public policy and shall be void and unenforceable. Any attempt by a credit services organization to have a buyer waive rights given by this title shall constitute a violation of this title.(b) In any proceeding involving this title, the burden of proving an exemption or an exception from a definition is upon the person claiming it.(c) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 42. Section 1789.19 is added to the Civil Code, to read:1789.19. (a) Any waiver by a consumer of the provisions of this title shall be deemed contrary to public policy and shall be void and unenforceable. Any attempt by a credit services organization to have a consumer waive rights given by this title shall constitute a violation of this title.(b) In any proceeding involving this title, the burden of proving an exemption or an exception from a definition is upon the person claiming it.(c) This section shall become operative on January 1, 2023.SEC. 43. Section 1789.21 of the Civil Code is amended to read:1789.21. (a) Any buyer injured by a violation of this title or by the credit services organizations breach of a contract subject to this title may bring any action for recovery of damages, or for injunctive relief, or both. Judgment shall be entered for actual damages, but in no case less than the amount paid by the buyer to the credit services organization, plus reasonable attorneys fees and costs. An award, if the trial court deems it proper, may be entered for punitive damages.(b) Any person, including, but not limited to, a consumer credit reporting agency, as defined in subdivision (d) of Section 1785.3, and any consumer of, or user of, a consumer credit report under the Consumer Credit Reporting Agencies Act (Title 1.6 (commencing with Section 1785.1)), and any furnisher of credit information under the Consumer Credit Reporting Agencies Act, may bring an action for the recovery of damages or for injunctive relief, or both, for a violation of this title. Any person bringing such an action who prevails in the action shall be entitled to reasonable attorneys fees and costs.(c) This section shall remain in effect until January 1, 2023, and as of that date is repealed.SEC. 44. Section 1789.21 is added to the Civil Code, to read:1789.21. (a) Any consumer injured by a violation of this title or by the credit services organizations breach of a contract subject to this title may bring any action for recovery of damages, or for injunctive relief, or both. Judgment shall be entered for actual damages, but in no case less than the amount paid by the consumer to the credit services organization, plus reasonable attorneys fees and costs. An award, if the trial court deems it proper, may be entered for punitive damages.(b) Any credit services organization that willfully and knowingly violates this title with respect to any consumer, in addition to any damages awarded pursuant to subdivision (a), shall also be liable to the consumer, in an individual action, for a civil penalty of not less than one hundred dollars ($100) and not greater than one thousand dollars ($1,000), to be determined by the court.(c) Any person, including, but not limited to, a consumer credit reporting agency, as defined in subdivision (d) of Section 1785.3, and any consumer of, or user of, a consumer credit report under the Consumer Credit Reporting Agencies Act (Title 1.6 (commencing with Section 1785.1)), and any furnisher of credit information under the Consumer Credit Reporting Agencies Act, may bring an action for the recovery of damages or for injunctive relief, or both, for a violation of this title. Any person bringing such an action who prevails in the action shall be entitled to reasonable attorneys fees and costs.(d) This section shall become operative on January 1, 2023.SEC. 45. Section 1789.25 of the Civil Code is amended to read:1789.25. (a) Every credit services organization shall file a registration application with, and receive a certificate of registration from, the Department of Justice before conducting business in this state. The Department of Justice shall not issue a certificate of registration until the bond required by Section 1789.18 has been filed with the office of the Secretary of State and the department establishes that the organization seeking a certificate satisfies the requirements of subdivision (f). The application shall be accompanied by a registration fee of one hundred dollars ($100). The registration application shall contain all of the following information:(1) The name and address where business is actually conducted of the credit services organization.(2) The names, addresses, and drivers license numbers of any and all persons who directly or indirectly own or control 10 percent or more of the outstanding shares of stock in the credit services organization.(3) Either of the following:(A) A full and complete disclosure of any litigation commenced against the credit services organization or any resolved or unresolved complaint that relates to the operation of the credit services organization and that is filed with the Attorney General or any other governmental authority of this state, any other state, or the federal government. With respect to each resolved complaint identified by the disclosure, the disclosure shall include a brief description of the resolution.(B) An acknowledged declaration under penalty of perjury stating that no litigation has been commenced and no unresolved complaint relating to the operation of the organization has been filed with the Attorney General or any other governmental authority of this state, any other state, or the federal government.(4) Other information that the Department of Justice requires, either at the time of application or thereafter.(b) The Department of Justice may conduct an investigation to verify the accuracy of the registration application. If the application involves investigation outside this state, the applicant credit services organization may be required by the Department of Justice to advance sufficient funds to pay the actual expenses of the investigation. Any nonresident applying for registration under this section shall designate and maintain a resident of this state as the applicants agent for the purpose of receipt of service of process.(c) Each credit services organization shall notify the Department of Justice in writing within 30 days after the date of a change in the information required by subdivision (a), except that 30 days advance notice and approval by the Department of Justice shall be required before changing the corporate name or address, or persons owning more than 10 percent of the shares of stock in the organization. Each credit services organization registering under this section may use no more than one fictitious or trade name and shall maintain a copy of the registration application in its files. The organization shall allow a buyer to inspect the registration application upon request.(d) A certificate of registration issued pursuant to this section shall expire annually on the last day of December but may be renewed by filing a renewal application accompanied by a fee not to exceed the Department of Justices costs of administration.(e) The credit services organization shall attach to the registration statement a copy of the contract or contracts which the credit services organization intends to execute with its customers and a copy of the required bond.(f) The Department of Justice shall not issue a certificate of registration under this title to any person who has engaged in, or proposes to engage in, any activity that is in violation of Section 1789.13, any law prohibiting the use of untrue or misleading statements, or any law related to the extension of credit to persons for personal, family, or household purposes.(g) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 46. Section 1789.25 is added to the Civil Code, to read:1789.25. (a) Every credit services organization shall file an application for licensure with, and receive a license from, the Department of Financial Protection and Innovation before conducting business in this state. The Department of Financial Protection and Innovation shall not issue a license until the bond required by Section 1789.18 has been filed with the Office of the Secretary of State and the department establishes that the organization seeking a license satisfies the requirements of subdivision (f). The application shall be accompanied by a license fee of one hundred dollars ($100). The Department of Financial Protection and Innovation may, periodically, increase the fee, but the amount of the fee shall not exceed that which is reasonable and necessary to satisfy its costs in complying with its duties under this title to regulate credit services organizations. The application shall contain all of the following information:(1) The name and address where business is actually conducted of the credit services organization.(2) The names, addresses, and drivers license numbers of any and all persons who directly or indirectly own or control 10 percent or more of the outstanding shares of stock in the credit services organization.(3) Either of the following:(A) A full and complete disclosure of any litigation commenced against the credit services organization or any resolved or unresolved complaint that relates to the operation of the credit services organization and that is filed with the Department of Financial Protection and Innovation, the Attorney General, or any other governmental authority of this state, any other state, or the federal government. With respect to each resolved complaint identified by the disclosure, the disclosure shall include a brief description of the resolution.(B) An acknowledged declaration under penalty of perjury stating that no litigation has been commenced and no unresolved complaint relating to the operation of the organization has been filed with the Department of Financial Protection and Innovation, the Attorney General, or any other governmental authority of this state, any other state, or the federal government.(4) Other information that the Department of Financial Protection and Innovation requires, either at the time of application or thereafter.(b) The Department of Financial Protection and Innovation may conduct an investigation to verify the accuracy of the licensure application. If the application involves investigation outside this state, the applicant credit services organization may be required by the Department of Financial Protection and Innovation to advance sufficient funds to pay the actual expenses of the investigation. Any nonresident applying for licensure under this section shall designate and maintain a resident of this state as the applicants agent for the purpose of receipt of service of process.(c) Each credit services organization shall notify the Department of Financial Protection and Innovation in writing within 30 days after the date of a change in the information required by subdivision (a), except that 30 days advance notice and approval by the Department of Financial Protection and Innovation shall be required before changing the corporate name or address, or persons owning more than 10 percent of the shares of stock in the organization. Each credit services organization applying for licensure under this section may use no more than one fictitious or trade name and shall maintain a copy of the license application in its files. The organization shall allow a buyer to inspect the license application upon request.(d) A license issued pursuant to this section shall expire one year after it was issued, but may be renewed by filing a renewal application accompanied by a fee in an amount to be determined annually by the Department of Financial Protection and Innovation as is reasonable and necessary to satisfy its costs in complying with its duties under this title to regulate credit services organizations. The Department of Financial Protection and Innovation may, periodically, increase the fee, but the amount of the fee shall not exceed that which is reasonable and necessary to satisfy its costs in complying with its duties under this title to regulate credit services organizations.(e) The credit services organization shall attach to the license statement a copy of the contract or contracts which the credit services organization intends to execute with its customers and a copy of the required bond.(f) The Department of Financial Protection and Innovation shall not issue a license under this title to any person who has engaged in, or proposes to engage in, any activity that is in violation of Section 1789.13, any law prohibiting the use of untrue or misleading statements, or any law related to the extension of credit to persons for personal, family, or household purposes.(g) The Department of Financial Protection and Innovation shall maintain on a publicly available internet website a list of the credit services organizations that are licensed in this state.(h) This section shall become operative on January 1, 2023.SEC. 47. The Legislature finds and declares that Section 30 of this act, which adds Section 1789.12.35 of the Civil Code, imposes a limitation on the publics right of access to the meetings of public bodies or the writings of public officials and agencies within the meaning of Section 3 of Article I of the California Constitution. Pursuant to that constitutional provision, the Legislature makes the following findings to demonstrate the interest protected by this limitation and the need for protecting that interest:Protecting from public disclosure limited confidential information provided by licensees to the Commissioner of the Department of Financial Protection and Innovation properly balances protecting legitimate private economic interests and public interests in effective regulation. SEC. 48. No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIIIB of the California Constitution. |
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| 1 | + | CALIFORNIA LEGISLATURE 20212022 REGULAR SESSION Assembly Bill No. 1089Introduced by Assembly Member GraysonFebruary 18, 2021 An act to amend, repeal, and add Sections 1789.11, 1789.12, 1789.13, 1789.14, 1789.15, 1789.16, 1789.19, 1789.21, and 1789.25 of, and to add Sections 1789.11.1, 1289.11.3, 1789.11.5, 1789.12.1, 1789.12.3, 1789.12.5, 1789.12.7, 1789.12.9, 1789.12.11, 1789.12.13, 1789.12.15, 1789.12.17, 1789.12.19, 1789.12.21, 1789.12.23, 1789.12.25, 1789.12.27, 1789.12.29, 1789.12.31, 1789.12.33, 1789.12.35, 1789.12.37, 1789.12.39, 1789.12.41, 1789.12.43, 1789.12.45, 1789.134, and 1789.135 to, the Civil Code, relating to consumer credit. LEGISLATIVE COUNSEL'S DIGESTAB 1089, as introduced, Grayson. Credit services organizations. Existing law, the Credit Services Act of 1984, defines and regulates the activities of credit services organizations. Existing law generally defines a credit services organization as a person who, for payment, performs specified credit-related services, such as improving a buyers credit record and obtaining loans. Existing law requires credit services organizations to obtain a surety bond, as specified, before conducting business and requires that they register with the Department of Justice, subject to a fee of $100.Existing law requires that credit services be provided pursuant to a written contract, which is required to contain specified provisions, and requires the credit services organization to provide a prescribed information statement before the execution of the contract. Existing law requires the contract to contain a notice informing the buyer that the contract can be canceled within 5 days from the date the contract is signed. Existing law prohibits, among other things, a credit services organization from receiving money before full and complete performance of the service the organization has agreed to perform and prohibits failing to perform the agreed-upon services within 6 months. Existing law makes a violation of these provisions a misdemeanor.Existing law authorizes a buyer of services who is injured by a credit services organizations violation of the act, or its breach of contract, to bring an action for damages or injunctive relief, as specified. Existing law also authorizes any person, including a consumer credit reporting agency, to bring an action, as specified, for a violation of these provisions.This bill would revise and recast these provisions to, instead, require the Department of Financial Protection and Innovation, commencing on January 1, 2023, to license, regulate, and oversee credit services organizations. The bill would, beginning on January 1, 2022, require the department to take all action necessary in order to be prepared to perform these duties commencing January 1, 2023, including, but not limited to, the adoption of necessary regulations. The bill would prohibit the public disclosure of specific information provided by a licensee to the department.This bill would prohibit a person from engaging in credit services in this state without a license and would also require the person to comply with specified requirements, and the reporting, examination, and other oversight requirements issued or mandated by the department. The bill would require a person applying for a license to, among other things, pay an application fee, sign the application under penalty of perjury , and submit to a criminal background check by the department. By expanding the scope of the crime of perjury this bill would impose a state-mandated local program.This bill would require each licensee to, among other things, file reports with the Commissioner of the Department of Financial Protection and Innovation under oath, maintain a surety bond, and pay to the department its pro rata share of all costs and expenses reasonably incurred in the administration of these provisions, as estimated by the department. The bill would authorize the department to enforce these provisions by, among other things, adopting regulations, performing investigations, suspending or revoking a license, issuing orders and claims for relief, and enforcing the provisions, as specified.The bill would revise information that must be provided to a consumer before a credit service contract is executed, including a notice regarding the filing of complaints with the department and would require the Attorney General and the department to maintain an internet website for this purpose.This bill would replace the term buyer with the term consumer for purposes of describing a person utilizing the services of a credit services organization and would prescribe other definitions in this regard. The bill would require a credit services organization to provide a consumer an itemized monthly statement showing each service performed for a consumer, as specified, and would require the organization to perform services agreed upon within 180 days of contracting for those services. The bill would require the information statement and contract to inform the consumer that the contract can be canceled before midnight on the 5th working day after execution of the document it.This bill would extend prohibitions on counseling a consumer to make untrue statements to other specified parties. Among other things, the bill would prohibit a credit services organization from impersonating a consumer and failing to identify communications as originating from the organization, from submitting a dispute to a consumer credit reporting agency, creditor, debt collector, or debt buyer more than 180 days after the disputed account has been removed, or from failing to provide along with its first written communication to a credit reporting agency or data furnisher sufficient information to investigate a dispute of an account. The bill would require a consumer credit reporting agency, creditor, debt collector, or debt buyer that knows that a consumer is represented by a credit services organization to communicate with the credit services organization, except as specified.This bill would require a credit services organization to redact specified information in certain written communications. The bill would require a credit services organization to maintain certain information on file for 4 years. The bill would require the department to maintain an internet website, as specified. The bill would prescribe statutory penalties that may be imposed on a credit services organization that willfully and knowingly violates these provisions. Because the bill would change the definition of a crime, the bill would impose a state-mandated local program. The bill would authorize the department to periodically increase the amount of the fee it is authorized to charge for licensure, regulation, and oversight of licensees, but the amount of the fee would be prohibited from exceeding that which is reasonable and necessary to satisfy the departments costs in complying with its duties to license, regulate, and oversee licensees.. The bill would create the Credit Repair Services Licensing Fund, the monies in which shall be available to the department upon appropriation by the Legislature.This bill would require a consumer credit reporting agency, creditor, debt collector, or debt buyer that knows that a consumer is represented by a credit service organization, and that also has knowledge of, or can readily ascertain the credit services organizations name and address, to communicate with the credit services organization, except as specified.Existing constitutional provisions require that a statute that limits the right of access to the meetings of public bodies or the writings of public officials and agencies be adopted with findings demonstrating the interest protected by the limitation and the need for protecting that interest.This bill would make legislative findings to that effect.The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.This bill would provide that no reimbursement is required by this act for a specified reason.Digest Key Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: YES Bill TextThe people of the State of California do enact as follows:SECTION 1. Section 1789.11 of the Civil Code is amended to read:1789.11. The Legislature finds and declares that:(a) The ability to obtain and use credit has become of great importance to consumers, who have a vital interest in establishing and maintaining their credit worthiness and credit standing. As a result, consumers who have experienced credit problems may seek assistance from credit services organizations which offer to obtain credit or improve the credit standing of such consumers.Certain advertising and business practices of some credit services organizations have worked a financial hardship upon the people of this state, often those who are of limited economic means and inexperienced in credit matters. Credit services organizations have significant impact upon the economy and well-being of this state and its people.(b) The purposes of this title are to provide prospective buyers of services of credit services organizations with the information necessary to make an intelligent decision regarding the purchase of those services and to protect the public from unfair or deceptive advertising and business practices.(c) This title shall be construed liberally to achieve these purposes.(d) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 2. Section 1789.11 is added to the Civil Code, to read:1789.11. The Legislature finds and declares that:(a) The ability to obtain and use credit has become of great importance to consumers, who have a vital interest in establishing and maintaining their credit worthiness and credit standing. As a result, consumers who have experienced credit problems may seek assistance from credit services organizations which offer to obtain credit or improve the credit standing of such consumers.Certain advertising and business practices of some credit services organizations have worked a financial hardship upon the people of this state, often those who are of limited economic means and inexperienced in credit matters. Credit services organizations have significant impact upon the economy and well-being of this state and its people.(b) The purposes of this title are to license, regulate, and oversee licensees, to provide prospective consumers of services of credit services organizations with the information necessary to make an intelligent decision regarding the purchase of those services and to protect the public from unfair or deceptive advertising and business practices.(c) This title shall be construed liberally to achieve these purposes.(d) This section shall become operative on January 1, 2023.SEC. 3. Section 1789.11.1 is added to the Civil Code, to read:1789.11.1. (a) Beginning on January 1, 2022, the Department of Financial Protection and Innovation shall take all action necessary to prepare to be able, commencing on January 1, 2023, to fully enforce the licensing and regulatory provisions of this title, including, but not limited to, adoption of all necessary regulations.(b) The Department of Financial Protection and Innovation shall allow any credit services organization that submits an application for licensure before January 1, 2023, to operate pending the denial or approval of the application.SEC. 4. Section 1789.11.3 is added to the Civil Code, to read:1789.11.3. (a) No city, county, city and county, or other political subdivision within this state shall require a credit services organization to be licensed.(b) This section shall become operative on January 1, 2023.SEC. 5. Section 1789.11.5 is added to the Civil Code, to read:1789.11.5. (a) No person shall provide credit services in this state without first obtaining a license pursuant to this title. A person is acting in this state if the person is located in this state and is seeking to provide credit services to a consumer that resides inside or outside the state, or is located outside of the state and is seeking to provide credit services to a consumer that resides in this state. (b) A license shall be obtained for the licensees principal place of business and shall not be transferred or assigned.(c) A separate license is not required for each individual branch office.(d) This section shall become operative on January 1, 2023.SEC. 6. Section 1789.12 of the Civil Code is amended to read:1789.12. As used in this title:(a) Credit services organization means a person who, with respect to the extension of credit by others, sells, provides, or performs, or represents that he or she the person can or will sell, provide or perform, any of the following services, in return for the payment of money or other valuable consideration:(1) Improving a buyers credit record, history, or rating.(2) Obtaining a loan or other extension of credit for a buyer.(3) Providing advice or assistance to a buyer with regard to either paragraph (1) or (2).(b) Credit services organization does not include any of the following:(1) Any person holding a license to make loans or extensions of credit pursuant to the laws of this state or the United States who is subject to regulation and supervision with respect to the making of those loans or extensions of credit by an official or agency of this state or the United States and whose business is the making of those loans or extensions of credit.(2) Any bank, as defined in Section 102 103 of the Financial Code, or any savings institution, as specified in subdivision (a) or (b) of Section 5102 of the Financial Code, whose deposits or accounts are eligible for insurance by the Federal Deposit Insurance Corporation.(3) Any person licensed as a prorater by the Department of Business Oversight when the person is acting within the course and scope of that license.(4)Any person licensed as a real estate broker performing an act for which a real estate license is required under the Real Estate Law (Pt. 1 (commencing with Sec. 10000), Div. 4, B. & P.C.) and who is acting within the course and scope of that license.(4) Any person licensed as a real estate broker performing an act for which a real estate license is required under the Real Estate Law (Part 1 (commencing with Section 10000) of Division 4 of the Business and Professions Code) and who is acting within the course and scope of that license(5) Any attorney licensed to practice law in this state, where the attorney renders services within the course and scope of the practice of law, unless the attorney is an employee of, or otherwise directly affiliated with, a credit services organization.(6) Any broker-dealer registered with the Securities and Exchange Commission or the Commodity Futures Trading Commission where the broker-dealer is acting within the course and scope of the regulation.(7) Any nonprofit organization described in Section 501(c)(3) of the Internal Revenue Code that, according to a final ruling or determination by the Internal Revenue Service, is both of the following:(A) Exempt from taxation under Section 501(a) of the Internal Revenue Code.(B) Not a private foundation as defined in Section 509 of the Internal Revenue Code.An advance ruling or determination of tax-exempt or foundation status by the Internal Revenue Service does not meet the requirements of this paragraph.(c) Buyer means any natural person who is solicited to purchase or who purchases the services of a credit services organization.(d) Extension of credit means the right to defer payment of debt or to incur debt and defer its payment, offered or granted primarily for personal, family, or household purposes.(e) Consumer credit reporting agency means a consumer credit reporting agency subject to the Consumer Credit Reporting Agencies Act, Title 1.6 (commencing with Section 1785.1).(f) Person includes an individual, corporation, partnership, joint venture, or any business entity.(g) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 7. Section 1789.12 is added to the Civil Code, to read:1789.12. (a) As used in this title:(1) Applicant means a person who has applied for a license pursuant to this title.(2) Commissioner means the Commissioner of the Department of Financial Protection and Innovation.(3) Communication means the conveyance of any information regarding a debt, credit record, credit history, or credit rating, directly or indirectly, to any person by any means or through any medium.(4) Consumer means any natural person who resides in California and is solicited to purchase or who purchases the services of a credit services organization.(5) Consumer credit reporting agency has the same meaning as in Section 1785.3.(6) (A) Credit services organization means a person who, with respect to the extension of credit by others, sells, provides, or performs, or represents that the person can or will sell, provide, or perform, any of the following services, in return for the payment of money or other valuable consideration:(i) Improving a consumers credit record, history, or rating.(ii) Obtaining a loan or other extension of credit for a consumer.(iii) Providing advice or assistance to a consumer with regard to either clause (i) or (ii).(B) Credit services organization does not include any of the following:(i) Any person holding a license to make loans or extensions of credit pursuant to the laws of this state or the United States who is subject to regulation and supervision with respect to the making of those loans or extensions of credit by an official or agency of this state or the United States and whose business is the making of those loans or extensions of credit.(ii) Any bank, as defined in Section 103 of the Financial Code, or any savings institution, as specified in subdivision (a) or (b) of Section 5102 of the Financial Code, whose deposits or accounts are eligible for insurance by the Federal Deposit Insurance Corporation.(iii) Any person licensed as a prorater by the Department of Financial Protection and Innovation when the person is acting within the course and scope of that license.(iv) Any person licensed as a real estate broker performing an act for which a real estate license is required under the Real Estate Law (Part 1 (commencing with Section 10000) of Division 4 of the Business and Professions Code) and who is acting within the course and scope of that license.(v) Any attorney licensed to practice law in this state, where the attorney renders services within the course and scope of the practice of law, unless the attorney is an employee of, or otherwise directly affiliated with, a credit services organization.(vi) Any broker-dealer registered with the Securities and Exchange Commission or the Commodity Futures Trading Commission where the broker-dealer is acting within the course and scope of the regulation.(vii) Any nonprofit organization described in Section 501(c)(3) of the Internal Revenue Code that, according to a final ruling or determination by the Internal Revenue Service, is both of the following:(I) Exempt from taxation under Section 501(a) of the Internal Revenue Code.(II) Not a private foundation as defined in Section 509 of the Internal Revenue Code.An advance ruling or determination of tax-exempt or foundation status by the Internal Revenue Service does not meet the requirements of this paragraph.(7) Data Furnisher has the same meaning as the term furnisher is defined in Section 660.2 of Title 16 of the Code of Federal Regulations.(8) Department means the Department of Financial Protection and Innovation.(9) Extension of credit means the right to defer payment of debt or to incur debt and defer its payment, offered or granted primarily for personal, family, or household purposes.(10) Fund means the Credit Services Organization Licensing Fund established pursuant to Section 1789.12.13.(11) Licensee means a person licensed pursuant to this chapter.(12) Nationwide Multistate Licensing System and Registry means a system of record, created by the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators, for nondepository, financial services licensing or registration in participating state agencies, the District of Colombia, Puerto Rico, the United States Virgin Islands, and Guam.(13) Person includes a natural person, corporation, partnership, limited liability company, joint venture, or any business entity.(b) This section shall become operative on January 1, 2023.SEC. 8. Section 1789.12.1 is added to the Civil Code, to read:1789.12.1. (a) The commissioner shall administer this title and may adopt rules and regulations, and issue orders, consistent with that authority.(b) Without limitation, the functions, powers, and duties of the commissioner include all of the following:(1) To issue or to refuse to issue a license as provided in this title.(2) To allow affiliated companies to be under a single license. The commissioner shall adopt regulations specifying what constitutes an affiliated company for these purposes.(3) To keep records of licenses issued under this title.(4) To receive, consider, investigate, and act upon a complaint made in connection with a licensee.(5) To prescribe the form of and to receive applications for licenses and reports, books, and records required to be made or retained by a licensee.(6) To subpoena documents and witnesses, and to compel their attendance and production, to administer oaths, and to require the production of books, papers, or other materials relevant to any inquiry authorized by this title.(7) To require information with regard to an applicant that the commissioner may deem necessary, with regard for the paramount public interest in ascertaining the experience, background, honesty, truthfulness, integrity, and competency of an applicant for providing credit services, and if an applicant is an entity other than an individual, in ascertaining the honesty, truthfulness, integrity, and competency of officers, directors, or managing members of the corporation, association, or other entity, or the general patterns of a partnership.(8) To enforce by order any provision of this title.(9) To levy fees, fines, and charges in an amount sufficient to cover the cost of the services performed in administering this title. The fees collected pursuant to this title shall not exceed the costs of administering this title.(c) This section shall become operative on January 1, 2023.SEC. 9. Section 1789.12.3 is added to the Civil Code, to read:1789.12.3. (a) The proceedings for a revocation of a license shall be conducted in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code.(b) The commissioner may suspend or revoke a license if, after notice and an opportunity for hearing, the commissioner finds any of the following:(1) The licensee violated this title or a regulation adopted or an order issued under this title.(2) The licensee does not cooperate with an examination or investigation by the commissioner.(3) The licensee is insolvent, suspends payment of its obligations, or makes a general assignment for the benefit of its creditors.(4) A receiver, liquidator, or conservator has been appointed for a licensee.(5) Any fact or condition exists that, if it had existed at the time that the licensee applied for the license, would have been grounds for denying the application.(c) This section shall become operative on January 1, 2023.SEC. 10. Section 1789.12.5 is added to the Civil Code, to read:1789.12.5. (a) Notwithstanding any law the commissioner shall have the authority to conduct investigations and examinations of an applicant or licensee as follows:(1) For purposes of determining whether an applicant is eligible for a license, or that a licensee is complying with the provisions of this title or any regulation or order of the commissioner, the commissioner may access, receive, and use any books, accounts, records, files, documents, information, or evidence that relates to the licensees credit services, including, but not limited to, any of the following relating to the intent to, or the practice of, providing credit services:(A) Criminal, civil, and administrative history information.(B) Personal history and experience information, including, but not limited to, independent credit reports obtained from a consumer reporting agency.(C) Any other documents, information, or evidence that the commissioner deems relevant to the inquiry or investigation regardless of the location, possession, control, or custody of those documents, information, or evidence.(2) For the purposes of investigating violations or complaints arising under this title, the commissioner may direct, subpoena, or order the attendance of, and examine under oath, any person whose testimony may be required about the consumer or the credit services organization.(b) In making any examination or investigation authorized by this section, the commissioner may control access to any documents and records of the licensee or person under examination or investigation. The commissioner may take possession of the documents and records or place a person in exclusive charge of the documents and records in the place where they are usually kept. During the period of control, no person shall remove or attempt to remove any of the documents and records except pursuant to a court order or with the consent of the commissioner. Unless the commissioner has reasonable grounds to believe the documents or records of a licensee have been, or are at risk of being, altered or destroyed for purposes of concealing a violation of this title, the licensee or owner of the documents and records shall have access to the documents or records as necessary to conduct their ordinary business affairs.(c) The commissioner may permit affiliated companies to be subject to a single examination. The department shall list all affiliated company names on the license and shall post them on the departments internet website.(d) This section shall become operative on January 1, 2023.SEC. 11. Section 1789.12.7 is added to the Civil Code, to read:1789.12.7. (a) If, in the opinion of the commissioner, a person who is required to be licensed under this title is engaged in the business of providing credit services without a license from the commissioner, or a person or licensee has violated any provision of this title, an order, or a regulation adopted pursuant to this title, the commissioner may do any of the following:(1) After notice and an opportunity for a hearing, order the person or licensee to desist and to refrain from engaging in the business of further continuing the violation.(2) After notice and an opportunity for a hearing, order the person or licensee to pay ancillary relief. The ancillary relief may include, but need not be limited to, refunds, restitution, disgorgement, and payment of damages, as appropriate, on behalf of a person injured by the conduct or practice that constitutes the subject matter of the assessment.(b) If, within 30 days after an order issued pursuant to subdivision (a) or (b) is served, a written request for a hearing is filed and no hearing is held within 30 days thereafter, the order shall be deemed rescinded.(c) This section shall become operative on January 1, 2023.SEC. 12. Section 1789.12.9 is added to the Civil Code, to read:1789.12.9. (a) Notwithstanding any law, the commissioner may by rule or order prescribe circumstances under which to accept electronic records or electronic signatures. This section shall not be deemed to require the commissioner to accept electronic records or electronic signatures.(b) For purposes of this section, the following terms have the following meanings:(1) Electronic record means an initial license application, or material modification of that license application, and any other record created, generated, sent, communicated, received, or stored by electronic means. Electronic record also includes, but is not limited to, all of the following electronic documents:(A) An application, amendment, supplement, and exhibit, filed for any license, consent, or other authority.(B) A financial statement, report, or advertising.(C) A surety bond, rider, or endorsement thereto.(D) An order, license, consent, or other authority.(E) A notice of public hearing, accusation, and statement of issues in connection with any application, license, consent, or other authority.(F) A proposed decision of a hearing officer and a decision of the commissioner.(G) The transcripts of a hearing and correspondence between a party and the commissioner directly relating to the record.(H) A release, newsletter, interpretive opinion, determination, or specific ruling.(I) Correspondence between a party and the commissioner directly relating to any document listed in subparagraphs (A) to (H), inclusive.(2) Electronic signature means an electronic sound, symbol, or process attached to or logically associated with an electronic record and executed or adopted by a person with the intent to sign the electronic record.(c) The Legislature finds and declares that the Department has continuously implemented methods to accept records filed electronically, and is encouraged to continue to expand its use of electronic filings to the extent feasible, as budget, resources, and equipment are made available to accomplish that goal. (d) This section shall become operative on January 1, 2023.SEC. 13. Section 1789.12.11 is added to the Civil Code, to read:1789.12.11. (a) The commissioner may require an applicant for a license to make some or all of the filings with the commissioner through the Nationwide Multistate Licensing System and Registry.(b) The commissioner may require an application to be made through the Nationwide Multistate Licensing System and Registry, and may require fees, fingerprints, financial statements, supporting documents, changes of address, and any other information, and amendments or modifications thereto, to be submitted by applicants and licensees through the Nationwide Multistate Licensing System and Registry.(c) The commissioner may require licensees to pay annual fees through the Nationwide Multistate Licensing System and Registry.(d) This section shall become operative on January 1, 2023.SEC. 14. Section 1789.12.13 is added to the Civil Code, to read:1789.12.13. (a) The Credit Services Licensing Fund is hereby established within the state treasury.(b) All licensing fees collected shall be deposited into the Fees Account which is hereby established within the fund.(c) All fines and penalties collected shall be deposited into the Penalties Account which is hereby established within the fund.(d) All monies deposited into the fund shall be available to the commissioner, upon appropriation by the Legislature, for the purposes of this title. (e) This section shall become operative on January 1, 2023.SEC. 15. Section 1789.12.15 is added to the Civil Code, to read:1789.12.15. An applicant shall apply for a license by submitting all of the following to the commissioner:(a) A completed application for a license in a form prescribed by the commissioner and signed under penalty of perjury. Every application shall include the location of the applicants principal place of business and all branch office locations.(b) An application fee and investigation fee, the amount of which shall be determined by the department, to cover any costs incurred in processing an application, including a fingerprint processing and criminal history record check under Section 1789.12.7. The investigation fee, including the amount for the criminal history record check, and the application fee are not refundable if an application is denied or withdrawn.(c) This section shall become operative on January 1, 2023.SEC. 16. Section 1789.12.17 is added to the Civil Code, to read:1789.12.17. (a) The commissioner shall submit to the Department of Justice fingerprint images and related information required by the Department of Justice of every applicant, as defined in paragraph (1) of subdivision (a) of Section 1789.12, for purposes of obtaining information as to the existence and content of a record of state or federal convictions, state or federal arrests, and information as to the existence and content of a record of state or federal arrests for which the Department of Justice establishes that the person is free on bail or on their own recognizance pending trial or appeal.(b) When received, the Department of Justice shall transmit fingerprint images and related information received pursuant to this section to the Federal Bureau of Investigation for the purpose of obtaining a federal criminal history records check. The Department of Justice shall review the information returned from the Federal Bureau of Investigation and compile and disseminate a response to the commissioner.(c) The Department of Justice shall provide a state or federal response to the commissioner pursuant to paragraph (1) of subdivision (p) of Section 11105 of the Penal Code.(d) The commissioner shall request from the Department of Justice subsequent arrest notification service, as provided pursuant to Section 11105.2 of the Penal Code, for the license applicant described in subdivision (a).(e) The Department of Justice shall charge a fee, payable by the applicant, sufficient to cover the costs of processing the requests pursuant to this section.(f) This section shall become operative on January 1, 2023.SEC. 17. Section 1789.12.19 is added to the Civil Code, to read:1789.12.19. (a) (1) Upon the filing of an application for a license pursuant to Section 1789.25 and the payment of the fees, if the applicant is a partnership, the commissioner shall investigate the applicant and its general partners and individuals owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or any individual responsible for the conduct of the applicants servicing activities in this state.(2) Upon the filing of an application for a license pursuant to Section 1789.25 and the payment of the fees, if the applicant is a corporation, trust, limited liability company, or association, including an unincorporated organization, the commissioner shall investigate the applicant, its principal officers, directors, trustee, managing members, and individuals owning or controlling, directly or indirectly, 10 percent or more of the outstanding equity securities or any individual responsible for the conduct of the applicants credit services in this state.(b) Upon the filing of an application for a license pursuant to Section 1789.25 and the payment of the fees, the commissioner shall investigate the individual responsible for the credit services of the licensee at the location described in the application. The investigation may be limited to information that was not included in prior applications filed pursuant to this title.(c) For the purposes of this section, principal officers shall mean president, chief executive officer, treasurer, and chief financial officer, as may be applicable, and any other officer with direct responsibility for the conduct of the applicants credit services in this state.(d) This section shall become operative on January 1, 2023.SEC. 18. Section 1789.12.21 is added to the Civil Code, to read:1789.12.21. (a) When the application is complete, including the information from the Department of Justice, and the commissioner determines that the applicant has satisfied the requirements set forth in this title and does not find facts constituting reasons for denial, the commissioner shall issue and deliver a license to the applicant.(b) If the commissioner determines that the requirements have not been satisfied, after notice and an opportunity for a hearing, the commissioner may deny the application and shall provide a written explanation for the denial.(c) This section shall become operative on January 1, 2023.SEC. 19. Section 1789.12.23 is added to the Civil Code, to read:1789.12.23. (a) The proceedings for a denial of a license shall be conducted in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code.(b) After notice and an opportunity for a hearing, the commissioner may deny an application for a license for any of the following reasons:(1) A false statement of a material fact has been made in the application.(2) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, within the last 10 years has (A) been convicted of, or pleaded nolo contendere to, a crime, other than traffic violations, or (B) committed any act involving dishonesty, fraud, or deceit, if the crime or act is substantially related to the qualifications, functions, or duties of a person engaged in business in accordance with this title.(3) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, has violated, or is not in material compliance with this title, or an order or rule of the commissioner.(4) A material requirement for issuance of a license has not been met, provided that a written notice of a material omission shall first be sent to the applicant with an opportunity to correct the omission prior to the applicants denial.(5) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, has violated this title or the rules thereunder, or any similar regulatory scheme of this or a foreign jurisdiction.(6) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, has been held liable by final judgment in a civil action under this title.(7) The commissioner, based on its investigation of the applicant, is unable to find that the financial responsibility, criminal records, experience, character, and general fitness of the applicant and its general partners, managing members, principal officers and directors, and individuals owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, support a finding that the business will be operated honestly, fairly, efficiently, and in accordance with the requirements of this title.(8) The commissioner may adopt regulations specifying the factors that the commissioner will consider in denying a license, including, but not limited to, the harm to the consumer, the frequency of prior violations, and the number of prior disciplinary actions taken against the licensee in California or in other states.(c) This section shall become operative on January 1, 2023.SEC. 20. Section 1789.12.25 is added to the Civil Code, to read:1789.12.25. (a) The commissioner may deem an application for a license abandoned if the applicant fails to respond to any request for information required by the commissioner or department during an investigation of the application.(b) The commissioner shall notify the applicant, in writing, that if the applicant fails to submit responsive information within 60 days from the date the commissioner sent the written request for information, the commissioner shall deem the application abandoned.(c) An application fee paid prior to the date an application is deemed abandoned shall not be refunded. Abandonment of an application pursuant to this subdivision shall not preclude the applicant from submitting a new application and fee for a license.(d) This section shall become operative on January 1, 2023.SEC. 21. Section 1789.12.27 is added to the Civil Code, to read:1789.12.27. (a) A license shall remain effective until the license is either suspended or revoked by the commissioner or surrendered by the licensee.(b) This section shall become operative on January 1, 2023.SEC. 22. Section 1789.12.29 is added to the Civil Code, to read:1789.12.29. (a) The commissioner is authorized to establish relationships or contracts with the Nationwide Multistate Licensing System and Registry or other entities designated by the Nationwide Multistate Licensing System and Registry to collect and maintain records and process transaction fees or other fees related to licensees or other persons subject to this title.(b) For the purpose of participating in the Nationwide Multistate Licensing System and Registry, the commissioner is authorized to waive or modify, in whole or in part, by rule, regulation, or order, any or all of the requirements of this title and to establish new requirements as reasonably necessary to participate in the Nationwide Multistate Licensing System and Registry.(c) The commissioner may use the Nationwide Multistate Licensing System and Registry as a channeling agent for requesting information from, and distributing information to, the Department of Justice, any other governmental agency, or any other source, as directed by the commissioner.(d) The commissioner shall establish a process through which applicants and licensees may challenge information entered into the Nationwide Multistate Licensing System and Registry by the commissioner.(e) This section shall become operative on January 1, 2023.SEC. 23. Section 1789.12.31 is added to the Civil Code, to read:1789.12.31. (a) Except as otherwise provided in Section 1512 of the SAFE Act (12 U.S.C. Sec. 5111(a)), the requirements under any federal law or the Information Practices Act of 1977 (Chapter 1 (commencing with Section 1798) of Part 4 of Division 3 of the Civil Code) regarding the privacy or confidentiality of any information or material provided to the Nationwide Multistate Licensing System and Registry, and any privilege arising under federal or state law, including the rules of any state court, with respect to that information or material, shall continue to apply to the information or material after the information or material has been disclosed to the Nationwide Multistate Licensing System and Registry. The information and material may be shared with all state and federal regulatory officials with industry oversight authority without the loss of privilege or the loss of confidentiality protections provided by federal law or the Information Practices Act.(b) Information or material that is subject to a privilege or confidentiality under subdivision (a) shall not be subject to any of the following:(1) Disclosure under any federal or state law governing the disclosure to the public of information held by an officer or an agency of the federal government or the state.(2) Subpoena or discovery, or admission into evidence, in any private civil action or administrative process, unless with respect to any privilege held by the Nationwide Multistate Licensing System and Registry with respect to the information or material, the person to whom the information or material pertains waives, in whole or in part, in the discretion of that person, that privilege.(c) This section shall not apply with respect to the information or material relating to the employment history of, and publicly adjudicated disciplinary and enforcement actions included in, the Nationwide Multistate Licensing System and Registry for access by the public.(d) This section shall become operative on January 1, 2023.SEC. 24. Section 1789.12.33 is added to the Civil Code, to read:1789.12.33. (a) The commissioner shall report regularly violations of this title, as well as enforcement actions and other relevant information, to the Nationwide Multistate Licensing System and Registry, to the extent that the information is a public record.(b) This section shall become operative on January 1, 2023.SEC. 25. Section 1789.12.35 is added to the Civil Code, to read:1789.12.35. (a) A licensee shall notify the commissioner, in writing, of any change in the information provided in the application for a license, as applicable, not later than 30 days after the occurrence of the event that results in the information becoming inaccurate or incomplete.(b) (1) If a licensee seeks to change its place of business to a street address other than that designated in its license, the licensee shall provide written notice to the commissioner at least 10 days prior to the change.(2) A licensee shall not engage in the business of credit services at a new location in a name other than a name approved by the commissioner.(3) A licensee that opens a new branch office or changes the location of an existing branch office shall notify the commissioner in writing of the new or changed branch office location within 30 days after the branch office begins business.(c) This section shall become operative on January 1, 2023.SEC. 26. Section 1789.12.37 is added to the Civil Code, to read:1789.12.37. A licensee shall do all of the following:(a) Develop policies and procedures reasonably intended to promote compliance with this title.(b) File with the commissioner any report required by the commissioner.(c) Comply with the provisions of this title and any regulation or order of the commissioner.(d) Submit to periodic examination by the commissioner as required by this title and any regulation or order of the commissioner.(e) Maintain a surety bond in accordance with this section in a minimum amount of twenty-five thousand dollars ($25,000). The bond shall be payable to the commissioner and issued by an insurer authorized to do business in this state. The surety bond, including any and all riders and endorsements executed subsequent to the effective date of the bond, shall be filed with the commissioner within 10 days of execution. The bond shall be used for the recovery of expenses, fines, and fees levied by the commissioner in accordance with this title. The commissioner may require licensees to submit bonds, riders, and endorsements electronically through the Nationwide Multistate Licensing System and Registrys electronic surety bond function.(1) When an action is commenced on a licensees bond, the commissioner may require the filing of a new bond. Immediately upon recovery of any action on the bond, the licensee shall file a new bond. Failure to file a new bond within 10 days of the recovery on a bond, or within 10 days after notification by the commissioner that a new bond is required, constitutes sufficient grounds for the suspension or revocation of the license. A licensee may provide the commissioner a refundable deposit in the amount of twenty-five thousand dollars ($25,000) in lieu of the bond while the licensee pursues a new bond.(2) The commissioner may require a higher bond amount for a licensee based on the number of affiliates under the license and the dollar amount of credit services performed by that licensee.(f) This section shall become operative on January 1, 2023.SEC. 27. Section 1789.12.39 is added to the Civil Code, to read:1789.12.39. (a) Each licensee shall pay to the commissioner its pro rata share of all costs and expenses reasonably incurred in the administration of this title, as estimated by the commissioner, for the ensuing year and any deficit actually incurred or anticipated in the administration of the title in the year in which the annual fee is levied. The pro rata share shall be based upon the proportion of net proceeds generated by California debtor accounts in the preceding year after the amount levied pursuant to subdivision (c).(b) On or before September 30 in each year, the commissioner shall notify each licensee of the amount of the annual fee schedule that will take effect on January 1. If payment is not made by January 1, the commissioner shall assess and collect a penalty, in addition to the fee, of 1 percent of the assessment for each month or part of a month that the payment is delayed or withheld.(c) In the levying and collection of the annual fees, a licensee shall neither be charged for nor be permitted to pay less than two hundred fifty dollars ($250) nor more than an aggregate of all reasonable costs to operate this title, with the exception of fees associated with investigations and examinations.(d) If a licensee fails to pay the annual fees on or before January 1, the commissioner may by order summarily suspend or revoke the license issued to the licensee. If, after an order is made, a request for hearing is filed in writing within 30 days, and a hearing is not held within 60 days thereafter, the order is deemed rescinded as of its effective date. During any period when the license is revoked or suspended, a licensee shall not engage in the business of credit services in this state pursuant to this title except as may be permitted by order of the commissioner. However, the revocation, suspension, or surrender of a license shall not affect the powers of the commissioner as provided in this title.(e) Notwithstanding subdivisions (a) to (d), inclusive, the commissioner may by rule require licensees to pay annual fees through the Nationwide Multistate Licensing System and Registry.(f) This section shall become operative on January 1, 2023.SEC. 28. Section 1789.12.41 is added to the Civil Code, to read:1789.12.41. (a) A licensee shall file an annual report with the commissioner, on or before March 15, that contains all relevant information that the commissioner reasonably requires concerning the business and operations conducted by the licensee in the state during the preceding calendar year, including information regarding credit services activity. The report shall, at minimum, require disclosure of all of the following information:(1) The total number of California consumers provided credit services in the preceding year.(2) The total dollar amount of credit services provided in the preceding year.(3) The face value dollar amount of credit services provided in the licensees portfolio in the preceding year.(4) The total dollar amount of California credit services provided in the preceding year, and the total dollar amount of outstanding debt that remains uncollected.(5) The total dollar amount of net proceeds generated by California consumers provided credit services in the preceding year.(6) The case number of any action in which the licensee was held liable by final judgment under this title.(b) The individual annual reports filed pursuant to this section shall be made available to the public for inspection.(c) The report shall be made under oath and in the form prescribed by the commissioner.(d) A licensee shall make other special reports that may be required by the commissioner.(e) This section shall become operative on January 1, 2023.SEC. 29. Section 1789.12.43 is added to the Civil Code, to read:1789.12.43. (a) A licensee that ceases to engage in providing credit services shall inform the commissioner in writing and surrender the license and all other indicia of license to the commissioner.(b) This section shall become operative on January 1, 2023.SEC. 30. Section 1789.12.45 is added to the Civil Code, to read:1789.12.45. (a) As often as the commissioner deems necessary and appropriate, the commissioner shall examine the affairs of each licensee for compliance with this title. The commissioner shall appoint suitable persons to perform the examination. The commissioner and their appointees may examine the books, records, and documents of the licensee, and may examine the licensees officers, directors, employees, or agents under oath regarding the licensees credit services.(b) The commissioner may cooperate with any agency of the state, the federal government, or other states in performing license examinations.(c) This section does not require the commissioner to conduct examinations at the business offices of licensees. Unless an onsite examination is considered necessary for the protection of the public, the commissioner may conduct some or all examinations without a site visit to the business office of a licensee, by requesting that licensees submit required books and records to the department electronically, via a secure portal.(d) Unless otherwise exempt pursuant to subparagraph (B) of paragraph (6) or subdivision (a) of Section 1789.12, affiliates of a licensee are subject to examination by the commissioner on the same terms as the licensee, but only when reports from, or examination of, a licensee provides documented evidence of unlawful activity between a licensee and affiliate benefitting, affecting, or arising from the activities regulated by this title.(e) The cost of each examination of a licensee shall be paid to the commissioner by the licensee examined, and the commissioner may maintain an action for the recovery of the cost in any court of competent jurisdiction. In determining the cost of the examination, the commissioner may use the estimated average hourly cost for all persons performing examinations of licensees or other persons subject to this title for the fiscal year.(f) The statement of the findings of an examination shall belong to the commissioner and shall not be disclosed to anyone other than the licensee, law enforcement officials, or other state or federal regulatory agencies for further investigation and enforcement. Reports required of licensees by the commissioner under this title and results of examinations performed by the commissioner under this title are the property of the commissioner.(g) The commissioner shall provide a written statement of the findings of the examination, issue a copy of that statement to the licensee and take appropriate steps to ensure correction of any violations of this title.(h) Notwithstanding any provision of this title, the commissioner shall have the authority to waive one or more branch office examinations, if the commissioner deems that the branch office examinations are not necessary for the protection of the public, due to the centralized operations of the licensee or other factors acceptable to the commissioner.(i) In any proceeding under this title, the burden of proving an exemption or an exception from a definition is upon the person claiming it.(j) This section shall become operative on January 1, 2023.SEC. 31. Section 1789.13 of the Civil Code is amended to read:1789.13. A credit services organization and its salespersons, agents, representatives, and independent contractors who sell or attempt to sell the services of a credit services organization shall not do any of the following:(a) Charge or receive any money or other valuable consideration prior to full and complete performance of the services the credit services organization has agreed to perform for or on behalf of the buyer.(b) Fail to perform the agreed services within six months following the date the buyer signs the contract for those services.(c) Charge or receive any money or other valuable consideration for referral of the buyer to a retail seller or other credit grantor who will or may extend credit to the buyer, if either of the following apply:(1) The credit that is or will be extended to the buyer (A) is upon substantially the same terms as those available to the general public or (B) is upon substantially the same terms that would have been extended to the buyer without the assistance of the credit services organization.(2) The money or consideration is paid by the credit grantor or is derived from the buyers payments to the credit grantor for costs, fees, finance charges, or principal.(d) Make, or counsel or advise a buyer to make, a statement that is untrue or misleading and that is known, or that by the exercise of reasonable care should be known, to be untrue or misleading, to a consumer credit reporting agency or to a person who has extended credit to a buyer or to whom a buyer is applying for an extension of credit, such as statements concerning a buyers identification, home address, creditworthiness, credit standing, or credit capacity.(e) Remove, or assist or advise the buyer to remove, adverse information from the buyers credit record which is accurate and not obsolete.(f) Create, or assist or advise the buyer to create, a new credit record by using a different name, address, social security number, or employee identification number.(g) Make or use untrue or misleading representations in the offer or sale of the services of a credit services organization, including either of the following:(1) Guaranteeing or otherwise stating that the organization is able to delete an adverse credit history, unless the representation clearly discloses, in a manner equally as conspicuous as the guarantee, that this can be done only if the credit history is inaccurate or obsolete and is not claimed to be accurate by the creditor who submitted the information.(2) Guaranteeing or otherwise stating that the organization is able to obtain an extension of credit, regardless of the buyers previous credit problems or credit history, unless the representation clearly discloses, in a manner equally as conspicuous as the guarantee, the eligibility requirements for obtaining an extension of credit.(h) Engage, directly or indirectly, in an act, practice, or course of business that operates or would operate as a fraud or deception upon a person in connection with the offer or sale of the services of a credit services organization.(i) Advertise or cause to be advertised, in any manner, the services of the credit services organization, without being registered with the Department of Justice.(j) Fail to maintain an agent for service of process in this state.(k) Transfer or assign its certificate of registration.(l) Submit a buyers dispute to a consumer credit reporting agency without the buyers knowledge.(m) Use a consumer credit reporting agencys telephone system or toll-free telephone number to represent the caller as the buyer in submitting a dispute of a buyer or requesting disclosure without prior authorization of the buyer.(n) Directly or indirectly extend credit to a buyer.(o) Refer a buyer to a credit grantor that is related to the credit services organization by a common ownership, management, or control, including a common owner, director, or officer.(p) Refer a buyer to a credit grantor for which the credit services organization provides, or arranges for a third party to provide, services related to the extension of credit such as underwriting, billing, payment processing, or debt collection.(q) Provide a credit grantor with an assurance that a portion of an extension of credit to a buyer referred by the credit services organization will be repaid, including providing a guaranty, letter of credit, or agreement to acquire a part of the credit grantors financial interest in the extension of credit.(r) Use a scheme, device, or contrivance to evade the prohibitions contained in this section.(s) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 32. Section 1789.13 is added to the Civil Code, to read:1789.13. (a) A credit services organization and its salespersons, agents, representatives, and independent contractors who sell or attempt to sell the services of a credit services organization shall not do any of the following:(1) Charge or receive any money or other valuable consideration prior to full and complete performance of the services the credit services organization has agreed to perform for or on behalf of the consumer.(2) Fail to perform the agreed services within 180 days following the date the consumer signs the contract for those services.(3) Fail to provide an itemized monthly statement to the consumer showing each service performed, including each call or written communication, and credit check made or sent on behalf of the consumer, and the date of each such service.(4) Fail to include in any written or digital communication to a consumer the California license number of the credit services organization in at least 12-point type.(5) Charge or receive any money or other valuable consideration for referral of the consumer to a retail seller or other credit grantor who will or may extend credit to the consumer, if either of the following apply:(A) The credit that is or will be extended to the consumer (i) is upon substantially the same terms as those available to the general public or (ii) is upon substantially the same terms that would have been extended to the consumer without the assistance of the credit services organization.(B) The money or consideration is paid by the credit grantor or is derived from the consumers payments to the credit grantor for costs, fees, finance charges, or principal.(6) Make, or counsel or advise a consumer to make, a statement that is untrue or misleading and that is known, or that by the exercise of reasonable care should be known, to be untrue or misleading, to a consumer credit reporting agency or to a person who has extended credit to a consumer, to a data furnisher, or to any person with whom a consumer is applying for an extension of credit, such as statements concerning a consumers identification, home address, creditworthiness, credit standing, or credit capacity.(7) Seek to remove, or assist or advise the consumer to remove or seek to remove, adverse information from the consumers credit record that is known to the credit services organization or that by the exercise of reasonable care should be known to the credit services organization to be accurate and not obsolete.(8) Create, or assist or advise the consumer to create, a new credit record by using a different name, address, social security number, or employee identification number.(9) Make or use untrue or misleading representations in the offer or sale of the services of a credit services organization, including either of the following:(A) Guaranteeing or otherwise stating that the credit services organization is able to delete an adverse credit history, unless the representation clearly discloses, in a manner equally as conspicuous as the guarantee, that this can be done only if the credit history is inaccurate or obsolete and is not claimed to be accurate by the creditor who submitted the information.(B) Guaranteeing or otherwise stating that the credit services organization is able to obtain an extension of credit, regardless of the consumers previous credit problems or credit history, unless the representation clearly discloses, in a manner equally as conspicuous as the guarantee, the eligibility requirements for obtaining an extension of credit.(10) Engage, directly or indirectly, in an act, practice, or course of business that operates or would operate as a fraud or deception upon a person in connection with the offer or sale of the services of a credit services organization.(11) Advertise or cause to be advertised, in any manner, the services of the credit services organization, without being registered with the Department of Financial Protection and Innovation.(12) Fail to maintain an agent for service of process in this state.(13) Transfer or assign its license.(14) Call or submit any communication to a consumer credit reporting agency, creditor, debt collector, or debt buyer without the prior written authorization of the consumer.(15) Call or submit any communication to a consumer reporting agency, creditor, debt collector, or debt buyer impersonating a consumer and failing to identify when the communication originates from the credit services organization.(16) Submit a consumers dispute to a consumer credit reporting agency, creditor, debt collector, or debt buyer more than 180 days after the account subject to the dispute has been removed.(17) Use the online electronic portal, electronic email system, or telephone system of a credit reporting agency, creditor, debt collector, or debt buyer to submit a dispute of a consumer or to request disclosure without the prior written authorization of the consumer.(18) Directly or indirectly extend credit to a consumer.(19) Refer a consumer to a credit grantor that is related to the credit services organization by a common ownership, management, or control, including a common owner, director, or officer.(20) Refer a consumer to a credit grantor for which the credit services organization provides, or arranges for a third party to provide, services related to the extension of credit such as underwriting, billing, payment processing, or debt collection.(21) Provide a credit grantor with an assurance that a portion of an extension of credit to a consumer referred by the credit services organization will be repaid, including providing a guaranty, letter of credit, or agreement to acquire a part of the credit grantors financial interest in the extension of credit.(22) Use a scheme, device, or contrivance to evade the prohibitions contained in this section.(23) Send any communication, directly or indirectly, to any person on behalf of a consumer without disclosing the senders identity, street address, telephone number, and facsimile number, and, if applicable, the name and street address of any parent organization of sender.(24) Send any written communication on behalf of a consumer to any person other than the consumer without providing a copy of the communication to the consumer within five days thereafter.(25) Fail to provide along with its first written communication to a credit reporting agency or data furnisher sufficient information to investigate a dispute of an account, including, but not limited to any pertinent information and copies of any documents that are available to it concerning the disputed item.(b) This section shall become operative on January 1, 2023.SEC. 33. Section 1789.134 is added to the Civil Code, to read:1789.134. (a) A consumer credit reporting agency, creditor, debt collector, or debt buyer that knows that a consumer is represented by a credit services organization pursuant to a power of attorney, and that also has knowledge of, or can readily ascertain the credit services organizations name and address shall communicate with the credit services organization unless either of the following circumstances apply:(1) The credit services organization fails to respond within a reasonable period of time to a communication from a consumer credit reporting agency, creditor, debt collector, or debt buyer.(2) The consumer expressly directs the consumer credit reporting agency, creditor, debt collector, or debt buyer not to communicate with the credit services organization.(b) Notwithstanding subdivision (a), a consumer credit reporting agency, creditor, or debt collector shall not be required to communicate with a credit services organization concerning an account that is subject to a dispute if any of the following apply:(1) The account subject to the dispute has been paid, settled, or otherwise resolved and has been reported as paid, settled, or otherwise resolved on the consumers credit report.(2) The account subject to the dispute has been removed from the consumers credit report.(3) The debt collector has provided to the credit services organization or to the consumer the verification information or documentation described in Section 1692g(b) of Title 15 of the United States Code regarding the account subject to dispute.(4) The debt buyer has provided to the credit services organization or to the consumer the information or documentation described in subdivisions (a) and (b) of Section 1788.52 regarding the account subject to the dispute.(5) The consumer credit reporting agency, creditor, or debt collector reasonably determines that the dispute is frivolous or irrelevant pursuant to Section 1681i(a)(3) or Section 1681s-2(a)(1)(F) of Title 15 of the United States Code. (c) This section shall become operative on January 1, 2023.SEC. 34. Section 1789.135 is added to the Civil Code, to read:1789.135. (a) To protect against fraud and identity theft, when a credit services organization sends a written communication by facsimile, electronic mail, United States mail, overnight courier, or other means that contains personal information of a consumer, the credit services organization shall redact the personal information to include only the last four digits of the social security number, taxpayer identification number, or state identification number, the last four digits of the financial account number, credit card number, or debit card number, or the month and year of the consumers date of birth, unless the inclusion of the full number or date is otherwise required by law, or is legally permissible and required to achieve the desired objective.(b) This section shall become operative on January 1, 2023.SEC. 35. Section 1789.14 of the Civil Code is amended to read:1789.14. (a) Prior to Before the execution of a contract or agreement between the buyer and a credit services organization, the credit services organization shall provide the buyer a statement in writing, containing all the information required by Section 1789.15. The credit services organization shall maintain on file or microfilm for a period of two years an exact copy of the statement, personally signed by the buyer, acknowledging receipt of a copy of the statement.(b) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 36. Section 1789.14 is added to the Civil Code, to read:1789.14. (a) Before the execution of a contract or agreement between the consumer and a credit services organization, the credit services organization shall provide the consumer a statement in writing containing all the information required by Section 1789.15. The credit services organization shall maintain on file for a period of four years following the completion or termination of the credit services organization agreement with the consumer an exact copy of the statement, personally signed by the consumer, acknowledging receipt of a copy of the statement.(b) This section shall become operative on January 1, 2023.SEC. 37. Section 1789.15 of the Civil Code is amended to read:1789.15. (a) The information statement shall include all of the following:(a)(1) A complete and detailed description of the services to be performed by the credit services organization for or on behalf of the buyer and the total amount the buyer will have to pay, or become obligated to pay, for the services.(b)(2) The buyers right to proceed against the bond under the circumstances and in the manner set forth in Section 1789.18.(c)(3) The name and address of the surety company which issued the bond.(d)(4) A complete and accurate statement of the availability of nonprofit credit counseling services.The information statement shall be printed in at least 10-point boldface type and shall include the following statement or any substantially equivalent alternative that is approved by the Department of Justice:CONSUMER CREDIT FILE RIGHTS UNDER STATE AND FEDERAL LAWYou have a right to obtain a copy of your credit file from a consumer credit reporting agency. You may be charged a reasonable fee not exceeding eight dollars ($8). There is no fee, however, if you have been turned down for credit, employment, insurance, or a rental dwelling because of information in your credit report within the preceding 60 days. The consumer credit reporting agency must provide someone to help you interpret the information in your credit file.You have a right to dispute inaccurate information by contacting the consumer credit reporting agency directly. However, neither you nor any credit repair company or credit services organization has the right to have accurate, current, and verifiable information removed from your credit report. Under the Federal Fair Credit Reporting Act, the consumer credit reporting agency must remove accurate, negative information from your report only if it is over seven years old. Bankruptcy information can be reported for 10 years.If you have notified a credit reporting agency in writing that you dispute the accuracy of information in your credit file, the consumer credit reporting agency must then reinvestigate and modify or remove inaccurate information. The consumer credit reporting agency may not charge a fee for this service. Any pertinent information and copies of all documents you have concerning an error should be given to the consumer credit reporting agency.If reinvestigation does not resolve the dispute to your satisfaction, you may send a brief statement to the consumer credit reporting agency to keep in your file, explaining why you think the record is inaccurate. The consumer credit reporting agency must include your statement about disputed information in any report it issues about you.You have a right to cancel the contract for any reason within five working days from the date you signed it. If for any reason you do cancel the contract during this time, you do not owe any money.You have a right to sue a credit services organization if it misleads you.(b) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 38. Section 1789.15 is added to the Civil Code, to read:1789.15. (a) The information statement shall include all of the following:(1) A complete and detailed description of the services to be performed by the credit services organization for or on behalf of the consumer and the total amount the consumer will have to pay, or become obligated to pay, for the services.(2) The consumers right to proceed against the bond under the circumstances and in the manner set forth in Section 1789.18.(3) The name and address of the surety company which issued the bond.(4) A complete and accurate statement of the availability of nonprofit credit counseling services.(5) The following notice: If you have a complaint about the services provided by this credit services organization or the fees charged by this credit services organization, you may submit that complaint to the Department of Financial Protection and Innovation at www.dfpi.ca.gov, or the Attorney Generals office, California Department of Justice, Attn: ____, P.O. Box 944255, Sacramento, CA 94244-2550.The information statement shall be printed in at least 10-point boldface type and shall include the following statement:CONSUMER CREDIT FILE RIGHTS UNDER STATE AND FEDERAL LAWYou have a right to obtain a free copy of your credit report from a credit reporting agency. You may obtain this free copy of your credit report one time per year by visiting www.AnnualCreditReport.com. You will be able to view your credit report, dispute alleged inaccuracies, and obtain additional information at no fee. If requested, the consumer credit reporting agency must provide someone to help you interpret the information in your credit file.You have a right to dispute inaccurate information by contacting the consumer credit reporting agency directly. However, neither you nor any credit repair company or credit services organization has the right to have accurate, current, and verifiable information removed from your credit report. Under the Federal Fair Credit Reporting Act, the consumer credit reporting agency must remove accurate, negative information from your report only if it is over seven years old. Bankruptcy information can be reported for 10 years.If you have notified a credit reporting agency in writing that you dispute the accuracy of information in your credit file, the consumer credit reporting agency must then reinvestigate and modify or remove inaccurate information. The consumer credit reporting agency may not charge a fee for this service. Any pertinent information and copies of all documents you have concerning an error should be given to the consumer credit reporting agency.If the reinvestigation does not resolve the dispute to your satisfaction, you may send a brief statement to the consumer credit reporting agency to keep in your file, explaining why you think the record is inaccurate. The consumer credit reporting agency must include your statement about disputed information in any report it issues about you.You have a right to cancel the contract with the credit services organization for any reason before midnight on the fifth working day after you signed it. If for any reason you cancel the contract during this time, you do not owe any money.You have a right to sue a credit services organization if it misleads you.(b) This section shall become operative on January 1, 2023.SEC. 39. Section 1789.16 of the Civil Code is amended to read:1789.16. (a) A credit services organization shall not provide any service to a buyer except pursuant to a written contract that complies with this section. Every contract between the buyer and a credit services organization for the purchase of the services of the credit services organization shall be in writing, shall be dated, signed by the buyer, and include all of the following:(1) A conspicuous statement in size equal to at least 10-point boldface type, in immediate proximity to the space reserved for the signature of the buyer, as follows:You, the buyer, may cancel this contract at any time prior to midnight of the fifth day after the date of the transaction. See the attached notice of cancellation form for an explanation of this right.(2) The terms and conditions of payment, including the total of all payments to be made by the buyer, whether to the credit services organization or to some other person.(3) A full and detailed description of the services to be performed by the credit services organization for the buyer, including all guarantees and all promises of full or partial refunds, and the estimated date by which the services are to be performed, or the estimated length of time for performing the services not to exceed six months or a shorter period consistent with the purposes of this title as may be prescribed by the Department of Justice.(4) The credit services organizations principal business address and the name and address of its agent, other than the Secretary of State, in the State of California, authorized to receive service of process.(b) The contract shall be accompanied by a completed form in duplicate, captioned Notice of Cancellation, which shall be attached to the contract and easily detachable, and which shall contain in type of at least 10-point the following statement written in the same language as used in the contract:Notice of CancellationYou may cancel this contract, without any penalty or obligation, within five days from the date the contract is signed.If you cancel, any payment made by you under this contract must be returned within 15 days following receipt by the seller of your cancellation notice.To cancel this contract, mail or deliver a signed and dated copy of this cancellation notice, or any other written notice, to _____ (name of seller) _____ at _____ (address of seller)(place of business) _____ not later than midnight (date).I hereby cancel this transaction.(date) _____ (purchasers signature) _____ A copy of the fully completed contract and all other documents the credit services organization requires the buyer to sign shall be given to the buyer at the time they are signed.(c) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 40. Section 1789.16 is added to the Civil Code, to read:1789.16. (a) A credit services organization shall not provide any service to a consumer except pursuant to a written contract that complies with this section. Every contract between the consumer and a credit services organization for the purchase of the services of the credit services organization shall identify the physical address, electronic mail address, and facsimile number if applicable, of the credit services organization, shall be in writing, shall be dated, shall be signed by the consumer, and shall include all of the following:(1) A conspicuous statement in size equal to at least 10-point boldface type, in immediate proximity to the space reserved for the signature of the buyer, as follows:You, the consumer, may cancel this contract at any time before midnight on the fifth working day after you sign it. See the attached notice of cancellation form for an explanation of this right.(2) The terms and conditions of payment, including the total of all payments to be made by the consumer, whether to the credit services organization or to some other person.(3) A full and detailed description of the services to be performed by the credit services organization for the consumer, including a list of the inaccurate or obsolete adverse information appearing on the consumers credit report which the credit services organization will seek to delete or modify, the basis for the deletion or modification, and, if applicable, a description of each modification sought and the anticipated payment required by the consumer to achieve each account deletion or modification, all guarantees and all promises of full or partial refunds, and the estimated date by which the services are to be performed, or the estimated length of time for performing the services, not to exceed 180 days, or a shorter period consistent with the purposes of this title as may be prescribed by the Department of Financial Protection and Innovation.(4) The credit services organizations principal business address and the name and address of its agent, other than the Secretary of State, in the State of California, authorized to receive service of process.(b) The contract shall be accompanied by a completed form in duplicate, captioned Notice of Cancellation, which shall be attached to the contract and easily detachable, and which shall contain in type of at least 10-point the following statement written in the same language as used in the contract:Notice of CancellationYou may cancel this contract, without any penalty or obligation, before midnight on the fifth working day after you sign it.If you cancel, any payment made by you under this contract must be returned within 15 days following receipt by the seller of your cancellation notice.To cancel this contract, mail or deliver a signed and dated copy of this cancellation notice, or any other written notice, to _____ (name of seller) _____ at _____ (address of seller)(place of business) _____ not later than midnight (date).I hereby cancel this transaction.(date) _____ (purchasers signature) _____ A copy of the fully completed contract and all other documents the credit services organization requires the buyer to sign shall be given to the consumer at the time they are signed.(c) This section shall become operative on January 1, 2023.SEC. 41. Section 1789.19 of the Civil Code is amended to read:1789.19. (a) Any waiver by a buyer of the provisions of this title shall be deemed contrary to public policy and shall be void and unenforceable. Any attempt by a credit services organization to have a buyer waive rights given by this title shall constitute a violation of this title.(b) In any proceeding involving this title, the burden of proving an exemption or an exception from a definition is upon the person claiming it.(c) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 42. Section 1789.19 is added to the Civil Code, to read:1789.19. (a) Any waiver by a consumer of the provisions of this title shall be deemed contrary to public policy and shall be void and unenforceable. Any attempt by a credit services organization to have a consumer waive rights given by this title shall constitute a violation of this title.(b) In any proceeding involving this title, the burden of proving an exemption or an exception from a definition is upon the person claiming it.(c) This section shall become operative on January 1, 2023.SEC. 43. Section 1789.21 of the Civil Code is amended to read:1789.21. (a) Any buyer injured by a violation of this title or by the credit services organizations breach of a contract subject to this title may bring any action for recovery of damages, or for injunctive relief, or both. Judgment shall be entered for actual damages, but in no case less than the amount paid by the buyer to the credit services organization, plus reasonable attorneys fees and costs. An award, if the trial court deems it proper, may be entered for punitive damages.(b) Any person, including, but not limited to, a consumer credit reporting agency, as defined in subdivision (d) of Section 1785.3, and any consumer of, or user of, a consumer credit report under the Consumer Credit Reporting Agencies Act (Title 1.6 (commencing with Section 1785.1)), and any furnisher of credit information under the Consumer Credit Reporting Agencies Act, may bring an action for the recovery of damages or for injunctive relief, or both, for a violation of this title. Any person bringing such an action who prevails in the action shall be entitled to reasonable attorneys fees and costs.(c) This section shall remain in effect until January 1, 2023, and as of that date is repealed.SEC. 44. Section 1789.21 is added to the Civil Code, to read:1789.21. (a) Any consumer injured by a violation of this title or by the credit services organizations breach of a contract subject to this title may bring any action for recovery of damages, or for injunctive relief, or both. Judgment shall be entered for actual damages, but in no case less than the amount paid by the consumer to the credit services organization, plus reasonable attorneys fees and costs. An award, if the trial court deems it proper, may be entered for punitive damages.(b) Any credit services organization that willfully and knowingly violates this title with respect to any consumer, in addition to any damages awarded pursuant to subdivision (a), shall also be liable to the consumer, in an individual action, for a civil penalty of not less than one hundred dollars ($100) and not greater than one thousand dollars ($1,000), to be determined by the court.(c) Any person, including, but not limited to, a consumer credit reporting agency, as defined in subdivision (d) of Section 1785.3, and any consumer of, or user of, a consumer credit report under the Consumer Credit Reporting Agencies Act (Title 1.6 (commencing with Section 1785.1)), and any furnisher of credit information under the Consumer Credit Reporting Agencies Act, may bring an action for the recovery of damages or for injunctive relief, or both, for a violation of this title. Any person bringing such an action who prevails in the action shall be entitled to reasonable attorneys fees and costs.(d) This section shall become operative on January 1, 2023.SEC. 45. Section 1789.25 of the Civil Code is amended to read:1789.25. (a) Every credit services organization shall file a registration application with, and receive a certificate of registration from, the Department of Justice before conducting business in this state. The Department of Justice shall not issue a certificate of registration until the bond required by Section 1789.18 has been filed with the office of the Secretary of State and the department establishes that the organization seeking a certificate satisfies the requirements of subdivision (f). The application shall be accompanied by a registration fee of one hundred dollars ($100). The registration application shall contain all of the following information:(1) The name and address where business is actually conducted of the credit services organization.(2) The names, addresses, and drivers license numbers of any and all persons who directly or indirectly own or control 10 percent or more of the outstanding shares of stock in the credit services organization.(3) Either of the following:(A) A full and complete disclosure of any litigation commenced against the credit services organization or any resolved or unresolved complaint that relates to the operation of the credit services organization and that is filed with the Attorney General or any other governmental authority of this state, any other state, or the federal government. With respect to each resolved complaint identified by the disclosure, the disclosure shall include a brief description of the resolution.(B) An acknowledged declaration under penalty of perjury stating that no litigation has been commenced and no unresolved complaint relating to the operation of the organization has been filed with the Attorney General or any other governmental authority of this state, any other state, or the federal government.(4) Other information that the Department of Justice requires, either at the time of application or thereafter.(b) The Department of Justice may conduct an investigation to verify the accuracy of the registration application. If the application involves investigation outside this state, the applicant credit services organization may be required by the Department of Justice to advance sufficient funds to pay the actual expenses of the investigation. Any nonresident applying for registration under this section shall designate and maintain a resident of this state as the applicants agent for the purpose of receipt of service of process.(c) Each credit services organization shall notify the Department of Justice in writing within 30 days after the date of a change in the information required by subdivision (a), except that 30 days advance notice and approval by the Department of Justice shall be required before changing the corporate name or address, or persons owning more than 10 percent of the shares of stock in the organization. Each credit services organization registering under this section may use no more than one fictitious or trade name and shall maintain a copy of the registration application in its files. The organization shall allow a buyer to inspect the registration application upon request.(d) A certificate of registration issued pursuant to this section shall expire annually on the last day of December but may be renewed by filing a renewal application accompanied by a fee not to exceed the Department of Justices costs of administration.(e) The credit services organization shall attach to the registration statement a copy of the contract or contracts which the credit services organization intends to execute with its customers and a copy of the required bond.(f) The Department of Justice shall not issue a certificate of registration under this title to any person who has engaged in, or proposes to engage in, any activity that is in violation of Section 1789.13, any law prohibiting the use of untrue or misleading statements, or any law related to the extension of credit to persons for personal, family, or household purposes.(g) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 46. Section 1789.25 is added to the Civil Code, to read:1789.25. (a) Every credit services organization shall file an application for licensure with, and receive a license from, the Department of Financial Protection and Innovation before conducting business in this state. The Department of Financial Protection and Innovation shall not issue a license until the bond required by Section 1789.18 has been filed with the Office of the Secretary of State and the department establishes that the organization seeking a license satisfies the requirements of subdivision (f). The application shall be accompanied by a license fee of one hundred dollars ($100). The Department of Financial Protection and Innovation may, periodically, increase the fee, but the amount of the fee shall not exceed that which is reasonable and necessary to satisfy its costs in complying with its duties under this title to regulate credit services organizations. The application shall contain all of the following information:(1) The name and address where business is actually conducted of the credit services organization.(2) The names, addresses, and drivers license numbers of any and all persons who directly or indirectly own or control 10 percent or more of the outstanding shares of stock in the credit services organization.(3) Either of the following:(A) A full and complete disclosure of any litigation commenced against the credit services organization or any resolved or unresolved complaint that relates to the operation of the credit services organization and that is filed with the Department of Financial Protection and Innovation, the Attorney General, or any other governmental authority of this state, any other state, or the federal government. With respect to each resolved complaint identified by the disclosure, the disclosure shall include a brief description of the resolution.(B) An acknowledged declaration under penalty of perjury stating that no litigation has been commenced and no unresolved complaint relating to the operation of the organization has been filed with the Department of Financial Protection and Innovation, the Attorney General, or any other governmental authority of this state, any other state, or the federal government.(4) Other information that the Department of Financial Protection and Innovation requires, either at the time of application or thereafter.(b) The Department of Financial Protection and Innovation may conduct an investigation to verify the accuracy of the licensure application. If the application involves investigation outside this state, the applicant credit services organization may be required by the Department of Financial Protection and Innovation to advance sufficient funds to pay the actual expenses of the investigation. Any nonresident applying for licensure under this section shall designate and maintain a resident of this state as the applicants agent for the purpose of receipt of service of process.(c) Each credit services organization shall notify the Department of Financial Protection and Innovation in writing within 30 days after the date of a change in the information required by subdivision (a), except that 30 days advance notice and approval by the Department of Financial Protection and Innovation shall be required before changing the corporate name or address, or persons owning more than 10 percent of the shares of stock in the organization. Each credit services organization applying for licensure under this section may use no more than one fictitious or trade name and shall maintain a copy of the license application in its files. The organization shall allow a buyer to inspect the license application upon request.(d) A license issued pursuant to this section shall expire one year after it was issued, but may be renewed by filing a renewal application accompanied by a fee in an amount to be determined annually by the Department of Financial Protection and Innovation as is reasonable and necessary to satisfy its costs in complying with its duties under this title to regulate credit services organizations. The Department of Financial Protection and Innovation may, periodically, increase the fee, but the amount of the fee shall not exceed that which is reasonable and necessary to satisfy its costs in complying with its duties under this title to regulate credit services organizations.(e) The credit services organization shall attach to the license statement a copy of the contract or contracts which the credit services organization intends to execute with its customers and a copy of the required bond.(f) The Department of Financial Protection and Innovation shall not issue a license under this title to any person who has engaged in, or proposes to engage in, any activity that is in violation of Section 1789.13, any law prohibiting the use of untrue or misleading statements, or any law related to the extension of credit to persons for personal, family, or household purposes.(g) The Department of Financial Protection and Innovation shall maintain on a publicly available internet website a list of the credit services organizations that are licensed in this state.(h) This section shall become operative on January 1, 2023.SEC. 47. The Legislature finds and declares that Section 30 of this act, which adds Section 1789.12.35 of the Civil Code, imposes a limitation on the publics right of access to the meetings of public bodies or the writings of public officials and agencies within the meaning of Section 3 of Article I of the California Constitution. Pursuant to that constitutional provision, the Legislature makes the following findings to demonstrate the interest protected by this limitation and the need for protecting that interest:Protecting from public disclosure limited confidential information provided by licensees to the Commissioner of the Department of Financial Protection and Innovation properly balances protecting legitimate private economic interests and public interests in effective regulation. SEC. 48. No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIIIB of the California Constitution. |
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| 64 | | - | The people of the State of California do enact as follows:SECTION 1. Section 1789.11 of the Civil Code is amended to read:1789.11. The Legislature finds and declares that:(a) The ability to obtain and use credit has become of great importance to consumers, who have a vital interest in establishing and maintaining their credit worthiness and credit standing. As a result, consumers who have experienced credit problems may seek assistance from credit services organizations which offer to obtain credit or improve the credit standing of such consumers.Certain advertising and business practices of some credit services organizations have worked a financial hardship upon the people of this state, often those who are of limited economic means and inexperienced in credit matters. Credit services organizations have significant impact upon the economy and well-being of this state and its people.(b) The purposes of this title are to provide prospective buyers of services of credit services organizations with the information necessary to make an intelligent decision regarding the purchase of those services and to protect the public from unfair or deceptive advertising and business practices.(c) This title shall be construed liberally to achieve these purposes.(d) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 2. Section 1789.11 is added to the Civil Code, to read:1789.11. The Legislature finds and declares that:(a) The ability to obtain and use credit has become of great importance to consumers, who have a vital interest in establishing and maintaining their credit worthiness and credit standing. As a result, consumers who have experienced credit problems may seek assistance from credit services organizations which offer to obtain credit or improve the credit standing of such consumers.Certain advertising and business practices of some credit services organizations have worked a financial hardship upon the people of this state, often those who are of limited economic means and inexperienced in credit matters. Credit services organizations have significant impact upon the economy and well-being of this state and its people.(b) The purposes of this title are to license, regulate, and oversee licensees, to provide prospective consumers of services of credit services organizations with the information necessary to make an intelligent decision regarding the purchase of those services and to protect the public from unfair or deceptive advertising and business practices.(c) This title shall be construed liberally to achieve these purposes.(d) This section shall become operative on January 1, 2023.SEC. 3. Section 1789.11.1 is added to the Civil Code, to read:1789.11.1. (a) Beginning on January 1, 2022, the Department of Financial Protection and Innovation shall take all action necessary to prepare to be able, commencing on January 1, 2023, to fully enforce the licensing and regulatory provisions of this title, including, but not limited to, adoption of all necessary regulations.(b) The Department of Financial Protection and Innovation shall allow any credit services organization that submits an application for licensure before January 1, 2023, to operate pending the denial or approval of the application.SEC. 4. Section 1789.11.3 is added to the Civil Code, to read:1789.11.3. (a) No city, county, city and county, or other political subdivision within this state shall require a credit services organization to be licensed.(b) This section shall become operative on January 1, 2023.SEC. 5. Section 1789.11.5 is added to the Civil Code, to read:1789.11.5. (a) No person shall provide credit services in this state without first obtaining a license pursuant to this title. A person is acting in this state if the person is located in this state and is seeking to provide credit services to a consumer that resides inside or outside the state, or is located outside of the state and is seeking to provide credit services to a consumer that resides in this state. (b) A license shall be obtained for the licensees principal place of business and shall not be transferred or assigned.(c) A separate license is not required for each individual branch office.(d) This section shall become operative on January 1, 2023.SEC. 6. Section 1789.12 of the Civil Code is amended to read:1789.12. As used in this title:(a) Credit services organization means a person who, with respect to the extension of credit by others, sells, provides, or performs, or represents that the person can or will sell, provide or perform, any of the following services, in return for the payment of money or other valuable consideration:(1) Improving a buyers credit record, history, or rating.(2) Obtaining a loan or other extension of credit for a buyer.(3) Providing advice or assistance to a buyer with regard to either paragraph (1) or (2).(b) Credit services organization does not include any of the following:(1) Any person holding a license to make loans or extensions of credit pursuant to the laws of this state or the United States who is subject to regulation and supervision with respect to the making of those loans or extensions of credit by an official or agency of this state or the United States and whose business is the making of those loans or extensions of credit.(2) Any bank, as defined in Section 103 of the Financial Code, or any savings institution, as specified in subdivision (a) or (b) of Section 5102 of the Financial Code, whose deposits or accounts are eligible for insurance by the Federal Deposit Insurance Corporation.(3) Any person licensed as a prorater by the Department of Business Oversight when the person is acting within the course and scope of that license.(4) Any person licensed as a real estate broker performing an act for which a real estate license is required under the Real Estate Law (Part 1 (commencing with Section 10000) of Division 4 of the Business and Professions Code) and who is acting within the course and scope of that license license.(5) Any attorney licensed to practice law in this state, where the attorney renders services within the course and scope of the practice of law, unless the attorney is an employee of, or otherwise directly affiliated with, a credit services organization.(6) Any broker-dealer registered with the Securities and Exchange Commission or the Commodity Futures Trading Commission where the broker-dealer is acting within the course and scope of the regulation.(7) Any nonprofit organization described in Section 501(c)(3) of the Internal Revenue Code that, according to a final ruling or determination by the Internal Revenue Service, is both of the following:(A) Exempt from taxation under Section 501(a) of the Internal Revenue Code.(B) Not a private foundation as defined in Section 509 of the Internal Revenue Code.An advance ruling or determination of tax-exempt or foundation status by the Internal Revenue Service does not meet the requirements of this paragraph.(c) Buyer means any natural person who is solicited to purchase or who purchases the services of a credit services organization.(d) Extension of credit means the right to defer payment of debt or to incur debt and defer its payment, offered or granted primarily for personal, family, or household purposes.(e) Consumer credit reporting agency means a consumer credit reporting agency subject to the Consumer Credit Reporting Agencies Act, Title 1.6 (commencing with Section 1785.1).(f) Person includes an individual, corporation, partnership, joint venture, or any business entity.(g) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 7. Section 1789.12 is added to the Civil Code, to read:1789.12. (a) As used in this title:(1) Applicant means a person who has applied for a license pursuant to this title.(2) Commissioner means the Commissioner of the Department of Financial Protection and Innovation.(3) Communication means the conveyance of any information regarding a debt, credit record, credit history, or credit rating, directly or indirectly, to any person by any means or through any medium.(4) Consumer means any natural person who resides in California and is solicited to purchase or who purchases the services of a credit services organization.(5) Consumer credit reporting agency has the same meaning as in Section 1785.3.(6) (A) Credit services organization means a person who, with respect to the extension of credit by others, sells, provides, or performs, or represents that the person can or will sell, provide, or perform, any of the following services, in return for the payment of money or other valuable consideration:(i) Improving a consumers credit record, history, or rating.(ii) Obtaining a loan or other extension of credit for a consumer.(iii) Providing advice or assistance to a consumer with regard to either clause (i) or (ii).(B) Credit services organization does not include any of the following:(i) Any person holding a license to make loans or extensions of credit pursuant to the laws of this state or the United States who is subject to regulation and supervision with respect to the making of those loans or extensions of credit by an official or agency of this state or the United States and whose business is the making of those loans or extensions of credit.(ii) Any bank, as defined in Section 103 of the Financial Code, or any savings institution, as specified in subdivision (a) or (b) of Section 5102 of the Financial Code, whose deposits or accounts are eligible for insurance by the Federal Deposit Insurance Corporation.(iii) Any person licensed as a prorater by the Department of Financial Protection and Innovation when the person is acting within the course and scope of that license.(iv) Any person licensed as a real estate broker performing an act for which a real estate license is required under the Real Estate Law (Part 1 (commencing with Section 10000) of Division 4 of the Business and Professions Code) and who is acting within the course and scope of that license.(v) Any attorney licensed to practice law in this state, where the attorney renders services within the course and scope of the practice of law, unless the attorney is an employee of, or otherwise directly affiliated with, a credit services organization.(vi) Any broker-dealer registered with the Securities and Exchange Commission or the Commodity Futures Trading Commission where the broker-dealer is acting within the course and scope of the regulation.(vii) Any nonprofit organization described in Section 501(c)(3) of the Internal Revenue Code that, according to a final ruling or determination by the Internal Revenue Service, is both of the following:(I) Exempt from taxation under Section 501(a) of the Internal Revenue Code.(II) Not a private foundation as defined in Section 509 of the Internal Revenue Code.An advance ruling or determination of tax-exempt or foundation status by the Internal Revenue Service does not meet the requirements of this paragraph.(7) Data Furnisher has the same meaning as the term furnisher is defined in Section 660.2 of Title 16 of the Code of Federal Regulations.(8) Department means the Department of Financial Protection and Innovation.(9) Extension of credit means the right to defer payment of debt or to incur debt and defer its payment, offered or granted primarily for personal, family, or household purposes.(10) Fund means the Credit Services Organization Licensing Fund established pursuant to Section 1789.12.13.(11) Licensee means a person licensed pursuant to this chapter.(12) Nationwide Multistate Licensing System and Registry means a system of record, created by the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators, for nondepository, financial services licensing or registration in participating state agencies, the District of Colombia, Puerto Rico, the United States Virgin Islands, and Guam.(13) Person includes a natural person, corporation, partnership, limited liability company, joint venture, or any business entity.(b) This section shall become operative on January 1, 2023.SEC. 8. Section 1789.12.1 is added to the Civil Code, to read:1789.12.1. (a) The commissioner shall administer this title and may adopt rules and regulations, and issue orders, consistent with that authority.(b) Without limitation, the functions, powers, and duties of the commissioner include all of the following:(1) To issue or to refuse to issue a license as provided in this title.(2) To allow affiliated companies to be under a single license. The commissioner shall adopt regulations specifying what constitutes an affiliated company for these purposes.(3) To keep records of licenses issued under this title.(4) To receive, consider, investigate, and act upon a complaint made in connection with a licensee.(5) To prescribe the form of and to receive applications for licenses and reports, books, and records required to be made or retained by a licensee.(6) To subpoena documents and witnesses, and to compel their attendance and production, to administer oaths, and to require the production of books, papers, or other materials relevant to any inquiry authorized by this title.(7) To require information with regard to an applicant that the commissioner may deem necessary, with regard for the paramount public interest in ascertaining the experience, background, honesty, truthfulness, integrity, and competency of an applicant for providing credit services, and if an applicant is an entity other than an individual, in ascertaining the honesty, truthfulness, integrity, and competency of officers, directors, or managing members of the corporation, association, or other entity, or the general patterns of a partnership.(8) To enforce by order any provision of this title.(9) To levy fees, fines, and charges in an amount sufficient to cover the cost of the services performed in administering this title. The fees collected pursuant to this title shall not exceed the costs of administering this title.(c) This section shall become operative on January 1, 2023.SEC. 9. Section 1789.12.3 is added to the Civil Code, to read:1789.12.3. (a) The proceedings for a revocation of a license shall be conducted in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code.(b) The commissioner may suspend or revoke a license if, after notice and an opportunity for hearing, the commissioner finds any of the following:(1) The licensee violated this title or a regulation adopted or an order issued under this title.(2) The licensee does not cooperate with an examination or investigation by the commissioner.(3) The licensee is insolvent, suspends payment of its obligations, or makes a general assignment for the benefit of its creditors.(4) A receiver, liquidator, or conservator has been appointed for a licensee.(5) Any fact or condition exists that, if it had existed at the time that the licensee applied for the license, would have been grounds for denying the application.(c) This section shall become operative on January 1, 2023.SEC. 10. Section 1789.12.5 is added to the Civil Code, to read:1789.12.5. (a) Notwithstanding any law the commissioner shall have the authority to conduct investigations and examinations of an applicant or licensee as follows:(1) For purposes of determining whether an applicant is eligible for a license, or that a licensee is complying with the provisions of this title or any regulation or order of the commissioner, the commissioner may access, receive, and use any books, accounts, records, files, documents, information, or evidence that relates to the licensees credit services, including, but not limited to, any of the following relating to the intent to, or the practice of, providing credit services:(A) Criminal, civil, and administrative history information.(B) Personal history and experience information, including, but not limited to, independent credit reports obtained from a consumer reporting agency.(C) Any other documents, information, or evidence that the commissioner deems relevant to the inquiry or investigation regardless of the location, possession, control, or custody of those documents, information, or evidence.(2) For the purposes of investigating violations or complaints arising under this title, the commissioner may direct, subpoena, or order the attendance of, and examine under oath, any person whose testimony may be required about the consumer or the credit services organization.(b) In making any examination or investigation authorized by this section, the commissioner may control access to any documents and records of the licensee or person under examination or investigation. The commissioner may take possession of the documents and records or place a person in exclusive charge of the documents and records in the place where they are usually kept. During the period of control, no person shall remove or attempt to remove any of the documents and records except pursuant to a court order or with the consent of the commissioner. Unless the commissioner has reasonable grounds to believe the documents or records of a licensee have been, or are at risk of being, altered or destroyed for purposes of concealing a violation of this title, the licensee or owner of the documents and records shall have access to the documents or records as necessary to conduct their ordinary business affairs.(c) The commissioner may permit affiliated companies to be subject to a single examination. The department shall list all affiliated company names on the license and shall post them on the departments internet website.(d) This section shall become operative on January 1, 2023.SEC. 11. Section 1789.12.7 is added to the Civil Code, to read:1789.12.7. (a) If, in the opinion of the commissioner, a person who is required to be licensed under this title is engaged in the business of providing credit services without a license from the commissioner, or a person or licensee has violated any provision of this title, an order, or a regulation adopted pursuant to this title, the commissioner may do any of the following:(1) After notice and an opportunity for a hearing, order the person or licensee to desist and to refrain from engaging in the business of further continuing the violation.(2) After notice and an opportunity for a hearing, order the person or licensee to pay ancillary relief. The ancillary relief may include, but need not be limited to, refunds, restitution, disgorgement, and payment of damages, as appropriate, on behalf of a person injured by the conduct or practice that constitutes the subject matter of the assessment.(b) If, within 30 days after an order issued pursuant to subdivision (a) or (b) is served, a written request for a hearing is filed and no hearing is held within 30 days thereafter, the order shall be deemed rescinded.(c) This section shall become operative on January 1, 2023.SEC. 12. Section 1789.12.9 is added to the Civil Code, to read:1789.12.9. (a) Notwithstanding any law, the commissioner may by rule or order prescribe circumstances under which to accept electronic records or electronic signatures. This section shall not be deemed to require the commissioner to accept electronic records or electronic signatures.(b) For purposes of this section, the following terms have the following meanings:(1) Electronic record means an initial license application, or material modification of that license application, and any other record created, generated, sent, communicated, received, or stored by electronic means. Electronic record also includes, but is not limited to, all of the following electronic documents:(A) An application, amendment, supplement, and exhibit, filed for any license, consent, or other authority.(B) A financial statement, report, or advertising.(C) A surety bond, rider, or endorsement thereto.(D) An order, license, consent, or other authority.(E) A notice of public hearing, accusation, and statement of issues in connection with any application, license, consent, or other authority.(F) A proposed decision of a hearing officer and a decision of the commissioner.(G) The transcripts of a hearing and correspondence between a party and the commissioner directly relating to the record.(H) A release, newsletter, interpretive opinion, determination, or specific ruling.(I) Correspondence between a party and the commissioner directly relating to any document listed in subparagraphs (A) to (H), inclusive.(2) Electronic signature means an electronic sound, symbol, or process attached to or logically associated with an electronic record and executed or adopted by a person with the intent to sign the electronic record.(c) The Legislature finds and declares that the Department has continuously implemented methods to accept records filed electronically, and is encouraged to continue to expand its use of electronic filings to the extent feasible, as budget, resources, and equipment are made available to accomplish that goal. (d) This section shall become operative on January 1, 2023.SEC. 13. Section 1789.12.11 is added to the Civil Code, to read:1789.12.11. (a) The commissioner may require an applicant for a license to make some or all of the filings with the commissioner through the Nationwide Multistate Licensing System and Registry.(b) The commissioner may require an application to be made through the Nationwide Multistate Licensing System and Registry, and may require fees, fingerprints, financial statements, supporting documents, changes of address, and any other information, and amendments or modifications thereto, to be submitted by applicants and licensees through the Nationwide Multistate Licensing System and Registry.(c) The commissioner may require licensees to pay annual fees through the Nationwide Multistate Licensing System and Registry.(d) This section shall become operative on January 1, 2023.SEC. 14. Section 1789.12.13 is added to the Civil Code, to read:1789.12.13. (a) The Credit Services Licensing Fund is hereby established within the state treasury.(b) All licensing fees collected shall be deposited into the Fees Account which is hereby established within the fund.(c) All fines and penalties collected shall be deposited into the Penalties Account which is hereby established within the fund.(d) All monies deposited into the fund shall be available to the commissioner, upon appropriation by the Legislature, for the purposes of this title. (e) This section shall become operative on January 1, 2023.SEC. 15. Section 1789.12.15 is added to the Civil Code, to read:1789.12.15. An applicant shall apply for a license by submitting all of the following to the commissioner:(a) A completed application for a license in a form prescribed by the commissioner and signed under penalty of perjury. Every application shall include the location of the applicants principal place of business and all branch office locations.(b) An application fee and investigation fee, the amount of which shall be determined by the department, to cover any costs incurred in processing an application, including a fingerprint processing and criminal history record check under Section 1789.12.7. The investigation fee, including the amount for the criminal history record check, and the application fee are not refundable if an application is denied or withdrawn.(c) This section shall become operative on January 1, 2023.SEC. 16. Section 1789.12.17 is added to the Civil Code, to read:1789.12.17. (a) The commissioner shall submit to the Department of Justice fingerprint images and related information required by the Department of Justice of every applicant, as defined in paragraph (1) of subdivision (a) of Section 1789.12, for purposes of obtaining information as to the existence and content of a record of state or federal convictions, state or federal arrests, and information as to the existence and content of a record of state or federal arrests for which the Department of Justice establishes that the person is free on bail or on their own recognizance pending trial or appeal.(b) When received, the Department of Justice shall transmit fingerprint images and related information received pursuant to this section to the Federal Bureau of Investigation for the purpose of obtaining a federal criminal history records check. The Department of Justice shall review the information returned from the Federal Bureau of Investigation and compile and disseminate a response to the commissioner.(c) The Department of Justice shall provide a state or federal response to the commissioner pursuant to paragraph (1) of subdivision (p) of Section 11105 of the Penal Code.(d) The commissioner shall request from the Department of Justice subsequent arrest notification service, as provided pursuant to Section 11105.2 of the Penal Code, for the license applicant described in subdivision (a).(e) The Department of Justice shall charge a fee, payable by the applicant, sufficient to cover the costs of processing the requests pursuant to this section.(f) This section shall become operative on January 1, 2023.SEC. 17. Section 1789.12.19 is added to the Civil Code, to read:1789.12.19. (a) (1) Upon the filing of an application for a license pursuant to Section 1789.25 and the payment of the fees, if the applicant is a partnership, the commissioner shall investigate the applicant and its general partners and individuals owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or any individual responsible for the conduct of the applicants servicing activities in this state.(2) Upon the filing of an application for a license pursuant to Section 1789.25 and the payment of the fees, if the applicant is a corporation, trust, limited liability company, or association, including an unincorporated organization, the commissioner shall investigate the applicant, its principal officers, directors, trustee, managing members, and individuals owning or controlling, directly or indirectly, 10 percent or more of the outstanding equity securities or any individual responsible for the conduct of the applicants credit services in this state.(b) Upon the filing of an application for a license pursuant to Section 1789.25 and the payment of the fees, the commissioner shall investigate the individual responsible for the credit services of the licensee at the location described in the application. The investigation may be limited to information that was not included in prior applications filed pursuant to this title.(c) For the purposes of this section, principal officers shall mean president, chief executive officer, treasurer, and chief financial officer, as may be applicable, and any other officer with direct responsibility for the conduct of the applicants credit services in this state.(d) This section shall become operative on January 1, 2023.SEC. 18. Section 1789.12.21 is added to the Civil Code, to read:1789.12.21. (a) When the application is complete, including the information from the Department of Justice, and the commissioner determines that the applicant has satisfied the requirements set forth in this title and does not find facts constituting reasons for denial, the commissioner shall issue and deliver a license to the applicant.(b) If the commissioner determines that the requirements have not been satisfied, after notice and an opportunity for a hearing, the commissioner may deny the application and shall provide a written explanation for the denial.(c) This section shall become operative on January 1, 2023.SEC. 19. Section 1789.12.23 is added to the Civil Code, to read:1789.12.23. (a) The proceedings for a denial of a license shall be conducted in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code.(b) After notice and an opportunity for a hearing, the commissioner may deny an application for a license for any of the following reasons:(1) A false statement of a material fact has been made in the application.(2) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, within the last 10 years has (A) been convicted of, or pleaded nolo contendere to, a crime, other than traffic violations, or (B) committed any act involving dishonesty, fraud, or deceit, if the crime or act is substantially related to the qualifications, functions, or duties of a person engaged in business in accordance with this title.(3) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, has violated, or is not in material compliance with this title, or an order or rule of the commissioner.(4) A material requirement for issuance of a license has not been met, provided that a written notice of a material omission shall first be sent to the applicant with an opportunity to correct the omission prior to the applicants denial.(5) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, has violated this title or the rules thereunder, or any similar regulatory scheme of this or a foreign jurisdiction.(6) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, has been held liable by final judgment in a civil action under this title.(7) The commissioner, based on its investigation of the applicant, is unable to find that the financial responsibility, criminal records, experience, character, and general fitness of the applicant and its general partners, managing members, principal officers and directors, and individuals owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, support a finding that the business will be operated honestly, fairly, efficiently, and in accordance with the requirements of this title.(8) The commissioner may adopt regulations specifying the factors that the commissioner will consider in denying a license, including, but not limited to, the harm to the consumer, the frequency of prior violations, and the number of prior disciplinary actions taken against the licensee in California or in other states.(c) This section shall become operative on January 1, 2023.SEC. 20. Section 1789.12.25 is added to the Civil Code, to read:1789.12.25. (a) The commissioner may deem an application for a license abandoned if the applicant fails to respond to any request for information required by the commissioner or department during an investigation of the application.(b) The commissioner shall notify the applicant, in writing, that if the applicant fails to submit responsive information within 60 days from the date the commissioner sent the written request for information, the commissioner shall deem the application abandoned.(c) An application fee paid prior to the date an application is deemed abandoned shall not be refunded. Abandonment of an application pursuant to this subdivision shall not preclude the applicant from submitting a new application and fee for a license.(d) This section shall become operative on January 1, 2023.SEC. 21. Section 1789.12.27 is added to the Civil Code, to read:1789.12.27. (a) A license shall remain effective until the license is either suspended or revoked by the commissioner or surrendered by the licensee.(b) This section shall become operative on January 1, 2023.SEC. 22. Section 1789.12.29 is added to the Civil Code, to read:1789.12.29. (a) The commissioner is authorized to establish relationships or contracts with the Nationwide Multistate Licensing System and Registry or other entities designated by the Nationwide Multistate Licensing System and Registry to collect and maintain records and process transaction fees or other fees related to licensees or other persons subject to this title.(b) For the purpose of participating in the Nationwide Multistate Licensing System and Registry, the commissioner is authorized to waive or modify, in whole or in part, by rule, regulation, or order, any or all of the requirements of this title and to establish new requirements as reasonably necessary to participate in the Nationwide Multistate Licensing System and Registry.(c) The commissioner may use the Nationwide Multistate Licensing System and Registry as a channeling agent for requesting information from, and distributing information to, the Department of Justice, any other governmental agency, or any other source, as directed by the commissioner.(d) The commissioner shall establish a process through which applicants and licensees may challenge information entered into the Nationwide Multistate Licensing System and Registry by the commissioner.(e) This section shall become operative on January 1, 2023.SEC. 23. Section 1789.12.31 is added to the Civil Code, to read:1789.12.31. (a) Except as otherwise provided in Section 1512 of the SAFE Act (12 U.S.C. Sec. 5111(a)), the requirements under any federal law or the Information Practices Act of 1977 (Chapter 1 (commencing with Section 1798) of Part 4 of Division 3 of the Civil Code) regarding the privacy or confidentiality of any information or material provided to the Nationwide Multistate Licensing System and Registry, and any privilege arising under federal or state law, including the rules of any state court, with respect to that information or material, shall continue to apply to the information or material after the information or material has been disclosed to the Nationwide Multistate Licensing System and Registry. The information and material may be shared with all state and federal regulatory officials with industry oversight authority without the loss of privilege or the loss of confidentiality protections provided by federal law or the Information Practices Act.(b) Information or material that is subject to a privilege or confidentiality under subdivision (a) shall not be subject to any of the following:(1) Disclosure under any federal or state law governing the disclosure to the public of information held by an officer or an agency of the federal government or the state.(2) Subpoena or discovery, or admission into evidence, in any private civil action or administrative process, unless with respect to any privilege held by the Nationwide Multistate Licensing System and Registry with respect to the information or material, the person to whom the information or material pertains waives, in whole or in part, in the discretion of that person, that privilege.(c) This section shall not apply with respect to the information or material relating to the employment history of, and publicly adjudicated disciplinary and enforcement actions included in, the Nationwide Multistate Licensing System and Registry for access by the public.(d) This section shall become operative on January 1, 2023.SEC. 24. Section 1789.12.33 is added to the Civil Code, to read:1789.12.33. (a) The commissioner shall report regularly violations of this title, as well as enforcement actions and other relevant information, to the Nationwide Multistate Licensing System and Registry, to the extent that the information is a public record.(b) This section shall become operative on January 1, 2023.SEC. 25. Section 1789.12.35 is added to the Civil Code, to read:1789.12.35. (a) A licensee shall notify the commissioner, in writing, of any change in the information provided in the application for a license, as applicable, not later than 30 days after the occurrence of the event that results in the information becoming inaccurate or incomplete.(b) (1) If a licensee seeks to change its place of business to a street address other than that designated in its license, the licensee shall provide written notice to the commissioner at least 10 days prior to the change.(2) A licensee shall not engage in the business of credit services at a new location in a name other than a name approved by the commissioner.(3) A licensee that opens a new branch office or changes the location of an existing branch office shall notify the commissioner in writing of the new or changed branch office location within 30 days after the branch office begins business.(c) This section shall become operative on January 1, 2023.SEC. 26. Section 1789.12.37 is added to the Civil Code, to read:1789.12.37. A licensee shall do all of the following:(a) Develop policies and procedures reasonably intended to promote compliance with this title.(b) File with the commissioner any report required by the commissioner.(c) Comply with the provisions of this title and any regulation or order of the commissioner.(d) Submit to periodic examination by the commissioner as required by this title and any regulation or order of the commissioner.(e) Maintain a surety bond in accordance with this section in a minimum amount of twenty-five thousand dollars ($25,000). The bond shall be payable to the commissioner and issued by an insurer authorized to do business in this state. The surety bond, including any and all riders and endorsements executed subsequent to the effective date of the bond, shall be filed with the commissioner within 10 days of execution. The bond shall be used for the recovery of expenses, fines, and fees levied by the commissioner in accordance with this title. The commissioner may require licensees to submit bonds, riders, and endorsements electronically through the Nationwide Multistate Licensing System and Registrys electronic surety bond function.(1) When an action is commenced on a licensees bond, the commissioner may require the filing of a new bond. Immediately upon recovery of any action on the bond, the licensee shall file a new bond. Failure to file a new bond within 10 days of the recovery on a bond, or within 10 days after notification by the commissioner that a new bond is required, constitutes sufficient grounds for the suspension or revocation of the license. A licensee may provide the commissioner a refundable deposit in the amount of twenty-five thousand dollars ($25,000) in lieu of the bond while the licensee pursues a new bond.(2) The commissioner may require a higher bond amount for a licensee based on the number of affiliates under the license and the dollar amount of credit services performed by that licensee.(f) This section shall become operative on January 1, 2023.SEC. 27. Section 1789.12.39 is added to the Civil Code, to read:1789.12.39. (a) Each licensee shall pay to the commissioner its pro rata share of all costs and expenses reasonably incurred in the administration of this title, as estimated by the commissioner, for the ensuing year and any deficit actually incurred or anticipated in the administration of the title in the year in which the annual fee is levied. The pro rata share shall be based upon the proportion of net proceeds generated by California debtor accounts in the preceding year after the amount levied pursuant to subdivision (c).(b) On or before September 30 in each year, the commissioner shall notify each licensee of the amount of the annual fee schedule that will take effect on January 1. If payment is not made by January 1, the commissioner shall assess and collect a penalty, in addition to the fee, of 1 percent of the assessment for each month or part of a month that the payment is delayed or withheld.(c) In the levying and collection of the annual fees, a licensee shall neither be charged for nor be permitted to pay less than two hundred fifty dollars ($250) nor more than an aggregate of all reasonable costs to operate this title, with the exception of fees associated with investigations and examinations.(d) If a licensee fails to pay the annual fees on or before January 1, the commissioner may by order summarily suspend or revoke the license issued to the licensee. If, after an order is made, a request for hearing is filed in writing within 30 days, and a hearing is not held within 60 days thereafter, the order is deemed rescinded as of its effective date. During any period when the license is revoked or suspended, a licensee shall not engage in the business of credit services in this state pursuant to this title except as may be permitted by order of the commissioner. However, the revocation, suspension, or surrender of a license shall not affect the powers of the commissioner as provided in this title.(e) Notwithstanding subdivisions (a) to (d), inclusive, the commissioner may by rule require licensees to pay annual fees through the Nationwide Multistate Licensing System and Registry.(f) This section shall become operative on January 1, 2023.SEC. 28. Section 1789.12.41 is added to the Civil Code, to read:1789.12.41. (a) A licensee shall file an annual report with the commissioner, on or before March 15, that contains all relevant information that the commissioner reasonably requires concerning the business and operations conducted by the licensee in the state during the preceding calendar year, including information regarding credit services activity. The report shall, at minimum, require disclosure of all of the following information:(1) The total number of California consumers provided credit services in the preceding year.(2) The total dollar amount of credit services provided in the preceding year.(3) The face value dollar amount of credit services provided in the licensees portfolio in the preceding year.(4) The total dollar amount of California credit services provided in the preceding year, and the total dollar amount of outstanding debt that remains uncollected.(5) The total dollar amount of net proceeds generated by California consumers provided credit services in the preceding year.(6) The case number of any action in which the licensee was held liable by final judgment under this title.(b) The individual annual reports filed pursuant to this section shall be made available to the public for inspection.(c) The report shall be made under oath and in the form prescribed by the commissioner.(d) A licensee shall make other special reports that may be required by the commissioner.(e) This section shall become operative on January 1, 2023.SEC. 29. Section 1789.12.43 is added to the Civil Code, to read:1789.12.43. (a) A licensee that ceases to engage in providing credit services shall inform the commissioner in writing and surrender the license and all other indicia of license to the commissioner.(b) This section shall become operative on January 1, 2023.SEC. 30. Section 1789.12.45 is added to the Civil Code, to read:1789.12.45. (a) As often as the commissioner deems necessary and appropriate, the commissioner shall examine the affairs of each licensee for compliance with this title. The commissioner shall appoint suitable persons to perform the examination. The commissioner and their appointees may examine the books, records, and documents of the licensee, and may examine the licensees officers, directors, employees, or agents under oath regarding the licensees credit services.(b) The commissioner may cooperate with any agency of the state, the federal government, or other states in performing license examinations.(c) This section does not require the commissioner to conduct examinations at the business offices of licensees. Unless an onsite examination is considered necessary for the protection of the public, the commissioner may conduct some or all examinations without a site visit to the business office of a licensee, by requesting that licensees submit required books and records to the department electronically, via a secure portal.(d) Unless otherwise exempt pursuant to subparagraph (B) of paragraph (6) or subdivision (a) of Section 1789.12, affiliates of a licensee are subject to examination by the commissioner on the same terms as the licensee, but only when reports from, or examination of, a licensee provides documented evidence of unlawful activity between a licensee and affiliate benefitting, affecting, or arising from the activities regulated by this title.(e) The cost of each examination of a licensee shall be paid to the commissioner by the licensee examined, and the commissioner may maintain an action for the recovery of the cost in any court of competent jurisdiction. In determining the cost of the examination, the commissioner may use the estimated average hourly cost for all persons performing examinations of licensees or other persons subject to this title for the fiscal year.(f) The statement of the findings of an examination shall belong to the commissioner and shall not be disclosed to anyone other than the licensee, law enforcement officials, or other state or federal regulatory agencies for further investigation and enforcement. Reports required of licensees by the commissioner under this title and results of examinations performed by the commissioner under this title are the property of the commissioner.(g) The commissioner shall provide a written statement of the findings of the examination, issue a copy of that statement to the licensee and take appropriate steps to ensure correction of any violations of this title.(h) Notwithstanding any provision of this title, the commissioner shall have the authority to waive one or more branch office examinations, if the commissioner deems that the branch office examinations are not necessary for the protection of the public, due to the centralized operations of the licensee or other factors acceptable to the commissioner.(i) In any proceeding under this title, the burden of proving an exemption or an exception from a definition is upon the person claiming it.(j) This section shall become operative on January 1, 2023.SEC. 31. Section 1789.13 of the Civil Code is amended to read:1789.13. A credit services organization and its salespersons, agents, representatives, and independent contractors who sell or attempt to sell the services of a credit services organization shall not do any of the following:(a) Charge or receive any money or other valuable consideration prior to full and complete performance of the services the credit services organization has agreed to perform for or on behalf of the buyer.(b) Fail to perform the agreed services within six months following the date the buyer signs the contract for those services.(c) Charge or receive any money or other valuable consideration for referral of the buyer to a retail seller or other credit grantor who will or may extend credit to the buyer, if either of the following apply:(1) The credit that is or will be extended to the buyer (A) is upon substantially the same terms as those available to the general public or (B) is upon substantially the same terms that would have been extended to the buyer without the assistance of the credit services organization.(2) The money or consideration is paid by the credit grantor or is derived from the buyers payments to the credit grantor for costs, fees, finance charges, or principal.(d) Make, or counsel or advise a buyer to make, a statement that is untrue or misleading and that is known, or that by the exercise of reasonable care should be known, to be untrue or misleading, to a consumer credit reporting agency or to a person who has extended credit to a buyer or to whom a buyer is applying for an extension of credit, such as statements concerning a buyers identification, home address, creditworthiness, credit standing, or credit capacity.(e) Remove, or assist or advise the buyer to remove, adverse information from the buyers credit record which is accurate and not obsolete.(f) Create, or assist or advise the buyer to create, a new credit record by using a different name, address, social security number, or employee identification number.(g) Make or use untrue or misleading representations in the offer or sale of the services of a credit services organization, including either of the following:(1) Guaranteeing or otherwise stating that the organization is able to delete an adverse credit history, unless the representation clearly discloses, in a manner equally as conspicuous as the guarantee, that this can be done only if the credit history is inaccurate or obsolete and is not claimed to be accurate by the creditor who submitted the information.(2) Guaranteeing or otherwise stating that the organization is able to obtain an extension of credit, regardless of the buyers previous credit problems or credit history, unless the representation clearly discloses, in a manner equally as conspicuous as the guarantee, the eligibility requirements for obtaining an extension of credit.(h) Engage, directly or indirectly, in an act, practice, or course of business that operates or would operate as a fraud or deception upon a person in connection with the offer or sale of the services of a credit services organization.(i) Advertise or cause to be advertised, in any manner, the services of the credit services organization, without being registered with the Department of Justice.(j) Fail to maintain an agent for service of process in this state.(k) Transfer or assign its certificate of registration.(l) Submit a buyers dispute to a consumer credit reporting agency without the buyers knowledge.(m) Use a consumer credit reporting agencys telephone system or toll-free telephone number to represent the caller as the buyer in submitting a dispute of a buyer or requesting disclosure without prior authorization of the buyer.(n) Directly or indirectly extend credit to a buyer.(o) Refer a buyer to a credit grantor that is related to the credit services organization by a common ownership, management, or control, including a common owner, director, or officer.(p) Refer a buyer to a credit grantor for which the credit services organization provides, or arranges for a third party to provide, services related to the extension of credit such as underwriting, billing, payment processing, or debt collection.(q) Provide a credit grantor with an assurance that a portion of an extension of credit to a buyer referred by the credit services organization will be repaid, including providing a guaranty, letter of credit, or agreement to acquire a part of the credit grantors financial interest in the extension of credit.(r) Use a scheme, device, or contrivance to evade the prohibitions contained in this section.(s) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 32. Section 1789.13 is added to the Civil Code, to read:1789.13. (a) A credit services organization and its salespersons, agents, representatives, and independent contractors who sell or attempt to sell the services of a credit services organization shall not do any of the following:(1) Charge or receive any money or other valuable consideration prior to full and complete performance of the services the credit services organization has agreed to perform for or on behalf of the consumer.(2) Fail to perform the agreed services within 180 days following the date the consumer signs the contract for those services.(3) Fail to provide an itemized a monthly statement to the consumer showing each service performed, including each call or written communication, and credit check made or sent on behalf of the consumer, and the date of each such service. detailing the services performed.(4) Fail to include in any written or digital communication to a consumer the California license number of the credit services organization in at least 12-point type.(5) Charge or receive any money or other valuable consideration for referral of the consumer to a retail seller or other credit grantor who will or may extend credit to the consumer, if either of the following apply:(A) The credit that is or will be extended to the consumer (i) is upon substantially the same terms as those available to the general public or (ii) is upon substantially the same terms that would have been extended to the consumer without the assistance of the credit services organization.(B) The money or consideration is paid by the credit grantor or is derived from the consumers payments to the credit grantor for costs, fees, finance charges, or principal.(6) Make, or counsel or advise a consumer to make, a statement that is untrue or misleading and that is known, or that by the exercise of reasonable care should be known, to be untrue or misleading, to a consumer credit reporting agency or to a person who has extended credit to a consumer, to a data furnisher, or to any person with whom a consumer is applying for an extension of credit, such as statements concerning a consumers identification, home address, creditworthiness, credit standing, or credit capacity.(7) Seek to remove, or assist or advise the consumer to remove or seek to remove, adverse information from the consumers credit record that is known to the credit services organization or that by the exercise of reasonable care should be known to the credit services organization to be accurate and not obsolete.(8) Create, or assist or advise the consumer to create, a new credit record by using a different name, address, social security number, or employee identification number.(9) Make or use untrue or misleading representations in the offer or sale of the services of a credit services organization, including either of the following:(A) Guaranteeing or otherwise stating that the credit services organization is able to delete an adverse credit history, unless the representation clearly discloses, in a manner equally as conspicuous as the guarantee, that this can be done only if the credit history is inaccurate or obsolete and is not claimed to be accurate by the creditor who submitted the information.(B) Guaranteeing or otherwise stating that the credit services organization is able to obtain an extension of credit, regardless of the consumers previous credit problems or credit history, unless the representation clearly discloses, in a manner equally as conspicuous as the guarantee, the eligibility requirements for obtaining an extension of credit.(10) Engage, directly or indirectly, in an act, practice, or course of business that operates or would operate as a fraud or deception upon a person in connection with the offer or sale of the services of a credit services organization.(11) Advertise or cause to be advertised, in any manner, the services of the credit services organization, without being registered with the Department of Financial Protection and Innovation.(12) Fail to maintain an agent for service of process in this state.(13) Transfer or assign its license.(14) Call or submit any communication to a consumer credit reporting agency, creditor, debt collector, or debt buyer without the prior written authorization of the consumer. A relevant authorization in the agreement or contract between a consumer and a credit services organization is sufficient for the purposes of this paragraph.(15)Call or submit any communication to a consumer reporting agency, creditor, debt collector, or debt buyer impersonating a consumer and failing to identify when the communication originates from the credit services organization. (16)(15) Submit a consumers dispute to a consumer credit reporting agency, creditor, debt collector, or debt buyer more than 180 days after the account subject to the dispute has been removed.(17)(16) Use the online electronic portal, electronic email system, or telephone system of a credit reporting agency, creditor, debt collector, or debt buyer to submit a dispute of a consumer or to request disclosure without the prior written authorization of the consumer. A relevant authorization in the agreement or contract between a consumer and a credit services organization is sufficient for the purposes of this paragraph.(18)(17) Directly or indirectly extend credit to a consumer.(19)(18) Refer a consumer to a credit grantor that is related to the credit services organization by a common ownership, management, or control, including a common owner, director, or officer.(20)(19) Refer a consumer to a credit grantor for which the credit services organization provides, or arranges for a third party to provide, services related to the extension of credit such as underwriting, billing, payment processing, or debt collection.(21)(20) Provide a credit grantor with an assurance that a portion of an extension of credit to a consumer referred by the credit services organization will be repaid, including providing a guaranty, letter of credit, or agreement to acquire a part of the credit grantors financial interest in the extension of credit.(22)(21) Use a scheme, device, or contrivance to evade the prohibitions contained in this section.(23)(22) Send any communication, directly or indirectly, to any person on behalf of a consumer without disclosing the senders identity, street address, telephone number, and facsimile number, and, if applicable, the name and street address of any parent organization of sender.(24)Send(23) Ensure that any written communication sent on behalf of a consumer to any person other than the consumer without providing a copy of the communication to the consumer within five days thereafter. is available to the consumer through the online portal.(25)(24) Fail to provide along with its first written communication to a credit reporting agency or data furnisher sufficient information to investigate a dispute of an account, including, but not limited to any pertinent information and copies of any documents that are available to it concerning the disputed item.(b) This section shall become operative on January 1, 2023.SEC. 33. Section 1789.134 is added to the Civil Code, to read:1789.134. (a) A consumer credit reporting agency, creditor, debt collector, or debt buyer that knows that a consumer is represented by a credit services organization pursuant to a power of attorney, organization, and that also has knowledge of, or can readily ascertain the credit services organizations name and address shall communicate with the credit services organization unless either of the following circumstances apply:(1) The credit services organization fails to respond within a reasonable period of time 30 days to a communication from a consumer credit reporting agency, creditor, debt collector, or debt buyer.(2) The consumer expressly directs the consumer credit reporting agency, creditor, debt collector, or debt buyer not to communicate with the credit services organization.(b) Notwithstanding subdivision (a), a consumer credit reporting agency, creditor, or debt collector shall not be required to communicate with a credit services organization concerning an account that is subject to a dispute if any of the following apply:(1) The account subject to the dispute has been paid, settled, or otherwise resolved and has been reported as paid, settled, or otherwise resolved on the consumers credit report.(2) The account subject to the dispute has been removed from the consumers credit report.(3) The debt collector has provided to the credit services organization or to the consumer the verification information or documentation described in Section 1692g(b) of Title 15 of the United States Code regarding the account subject to dispute.(4) The debt buyer has provided to the credit services organization or to the consumer the information or documentation described in subdivisions (a) and (b) of Section 1788.52 regarding the account subject to the dispute.(5) The consumer credit reporting agency, creditor, or debt collector reasonably determines that the dispute is frivolous or irrelevant pursuant to Section 1681i(a)(3) or Section 1681s-2(a)(1)(F) of Title 15 of the United States Code. (c) This section shall become operative on January 1, 2023.SEC. 34. Section 1789.135 is added to the Civil Code, to read:1789.135. (a) To protect against fraud and identity theft, when a credit services organization sends a written communication by facsimile, electronic mail, United States mail, overnight courier, or other means that contains personal information of a consumer, the credit services organization shall redact the personal information to include only the last four digits of the social security number, taxpayer identification number, or state identification number, the last four digits of the financial account number, credit card number, or debit card number, or the month and year of the consumers date of birth, unless the inclusion of the full number or date is otherwise required by law, or is legally permissible and required to achieve the desired objective. Redacting information pursuant to this subdivision shall not be considered a violation of paragraph (24) of subdivision (a) of Section 1789.13.(b) This section shall become operative on January 1, 2023.SEC. 35. Section 1789.14 of the Civil Code is amended to read:1789.14. (a) Before the execution of a contract or agreement between the buyer and a credit services organization, the credit services organization shall provide the buyer a statement in writing, containing all the information required by Section 1789.15. The credit services organization shall maintain on file or microfilm for a period of two years an exact copy of the statement, personally signed by the buyer, acknowledging receipt of a copy of the statement.(b) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 36. Section 1789.14 is added to the Civil Code, to read:1789.14. (a) Before the execution of a contract or agreement between the consumer and a credit services organization, the credit services organization shall provide the consumer a statement in writing containing all the information required by Section 1789.15. The credit services organization shall maintain on file for a period of four years following the completion or termination of the credit services organization agreement with the consumer an exact copy of the statement, personally signed by the consumer, acknowledging receipt of a copy of the statement.(b) This section shall become operative on January 1, 2023.SEC. 37. Section 1789.15 of the Civil Code is amended to read:1789.15. (a) The information statement shall include all of the following:(1) A complete and detailed description of the services to be performed by the credit services organization for or on behalf of the buyer and the total amount the buyer will have to pay, or become obligated to pay, for the services.(2) The buyers right to proceed against the bond under the circumstances and in the manner set forth in Section 1789.18.(3) The name and address of the surety company which issued the bond.(4) A complete and accurate statement of the availability of nonprofit credit counseling services.The information statement shall be printed in at least 10-point boldface type and shall include the following statement or any substantially equivalent alternative that is approved by the Department of Justice:CONSUMER CREDIT FILE RIGHTS UNDER STATE AND FEDERAL LAWYou have a right to obtain a copy of your credit file from a consumer credit reporting agency. You may be charged a reasonable fee not exceeding eight dollars ($8). There is no fee, however, if you have been turned down for credit, employment, insurance, or a rental dwelling because of information in your credit report within the preceding 60 days. The consumer credit reporting agency must provide someone to help you interpret the information in your credit file.You have a right to dispute inaccurate information by contacting the consumer credit reporting agency directly. However, neither you nor any credit repair company or credit services organization has the right to have accurate, current, and verifiable information removed from your credit report. Under the Federal Fair Credit Reporting Act, the consumer credit reporting agency must remove accurate, negative information from your report only if it is over seven years old. Bankruptcy information can be reported for 10 years.If you have notified a credit reporting agency in writing that you dispute the accuracy of information in your credit file, the consumer credit reporting agency must then reinvestigate and modify or remove inaccurate information. The consumer credit reporting agency may not charge a fee for this service. Any pertinent information and copies of all documents you have concerning an error should be given to the consumer credit reporting agency.If reinvestigation does not resolve the dispute to your satisfaction, you may send a brief statement to the consumer credit reporting agency to keep in your file, explaining why you think the record is inaccurate. The consumer credit reporting agency must include your statement about disputed information in any report it issues about you.You have a right to cancel the contract for any reason within five working days from the date you signed it. If for any reason you do cancel the contract during this time, you do not owe any money.You have a right to sue a credit services organization if it misleads you.(b) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 38. Section 1789.15 is added to the Civil Code, to read:1789.15. (a) The information statement shall include all of the following:(1) A complete and detailed description of the services to be performed by the credit services organization for or on behalf of the consumer and the total amount the consumer will have to pay, or become obligated to pay, for the services.(2) The consumers right to proceed against the bond under the circumstances and in the manner set forth in Section 1789.18.(3) The name and address of the surety company which issued the bond.(4) A complete and accurate statement of the availability of nonprofit credit counseling services.(5) The following notice: If you have a complaint about the services provided by this credit services organization or the fees charged by this credit services organization, you may submit that complaint to the Department of Financial Protection and Innovation at www.dfpi.ca.gov, or the Attorney Generals office, California Department of Justice, Attn: ____, P.O. Box 944255, Sacramento, CA 94244-2550.The information statement shall be printed in at least 10-point boldface type and shall include the following statement:CONSUMER CREDIT FILE RIGHTS UNDER STATE AND FEDERAL LAWYou have a right to obtain a free copy of your credit report from a credit reporting agency. You may obtain this free copy of your credit report one time per year by visiting www.AnnualCreditReport.com. You will be able to view your credit report, dispute alleged inaccuracies, and obtain additional information at no fee. If requested, the consumer credit reporting agency must provide someone to help you interpret the information in your credit file.You have a right to dispute inaccurate information by contacting the consumer credit reporting agency directly. However, neither you nor any credit repair company or credit services organization has the right to have accurate, current, and verifiable information removed from your credit report. Under the Federal Fair Credit Reporting Act, the consumer credit reporting agency must remove accurate, negative information from your report only if it is over seven years old. Bankruptcy information can be reported for 10 years.If you have notified a credit reporting agency in writing that you dispute the accuracy of information in your credit file, the consumer credit reporting agency must then reinvestigate and modify or remove inaccurate information. The consumer credit reporting agency may not charge a fee for this service. Any pertinent information and copies of all documents you have concerning an error should be given to the consumer credit reporting agency.If the reinvestigation does not resolve the dispute to your satisfaction, you may send a brief statement to the consumer credit reporting agency to keep in your file, explaining why you think the record is inaccurate. The consumer credit reporting agency must include your statement about disputed information in any report it issues about you.You have a right to cancel the contract with the credit services organization for any reason before midnight on the fifth working day after you signed it. If for any reason you cancel the contract during this time, you do not owe any money.You have a right to sue a credit services organization if it misleads you.(b) This section shall become operative on January 1, 2023.SEC. 39. Section 1789.16 of the Civil Code is amended to read:1789.16. (a) A credit services organization shall not provide any service to a buyer except pursuant to a written contract that complies with this section. Every contract between the buyer and a credit services organization for the purchase of the services of the credit services organization shall be in writing, shall be dated, signed by the buyer, and include all of the following:(1) A conspicuous statement in size equal to at least 10-point boldface type, in immediate proximity to the space reserved for the signature of the buyer, as follows:You, the buyer, may cancel this contract at any time prior to midnight of the fifth day after the date of the transaction. See the attached notice of cancellation form for an explanation of this right.(2) The terms and conditions of payment, including the total of all payments to be made by the buyer, whether to the credit services organization or to some other person.(3) A full and detailed description of the services to be performed by the credit services organization for the buyer, including all guarantees and all promises of full or partial refunds, and the estimated date by which the services are to be performed, or the estimated length of time for performing the services not to exceed six months or a shorter period consistent with the purposes of this title as may be prescribed by the Department of Justice.(4) The credit services organizations principal business address and the name and address of its agent, other than the Secretary of State, in the State of California, authorized to receive service of process.(b) The contract shall be accompanied by a completed form in duplicate, captioned Notice of Cancellation, which shall be attached to the contract and easily detachable, and which shall contain in type of at least 10-point the following statement written in the same language as used in the contract:Notice of CancellationYou may cancel this contract, without any penalty or obligation, within five days from the date the contract is signed.If you cancel, any payment made by you under this contract must be returned within 15 days following receipt by the seller of your cancellation notice.To cancel this contract, mail or deliver a signed and dated copy of this cancellation notice, or any other written notice, to _____ (name of seller) _____ at _____ (address of seller)(place of business) _____ not later than midnight (date).I hereby cancel this transaction.(date) _____ (purchasers signature) _____ A copy of the fully completed contract and all other documents the credit services organization requires the buyer to sign shall be given to the buyer at the time they are signed.(c) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 40. Section 1789.16 is added to the Civil Code, to read:1789.16. (a) A credit services organization shall not provide any service to a consumer except pursuant to a written contract that complies with this section. Every contract between the consumer and a credit services organization for the purchase of the services of the credit services organization shall identify the physical address, electronic mail address, and facsimile number if applicable, of the credit services organization, shall be in writing, shall be dated, shall be signed by the consumer, and shall include all of the following:(1) A conspicuous statement in size equal to at least 10-point boldface type, in immediate proximity to the space reserved for the signature of the buyer, as follows:You, the consumer, may cancel this contract at any time before midnight on the fifth working day after you sign it. See the attached notice of cancellation form for an explanation of this right.(2) The terms and conditions of payment, including the total of all payments to be made by the consumer, whether to the credit services organization or to some other person.(3) A full and detailed description of the services to be performed by the credit services organization for the consumer, including a list of the inaccurate or obsolete adverse information appearing on the consumers credit report which the credit services organization will seek to delete or modify, the basis for the deletion or modification, and, if applicable, a description of each modification sought and the anticipated payment required by the consumer to achieve each account deletion or modification, all guarantees and all promises of full or partial refunds, and the estimated date by which the services are to be performed, or the estimated length of time for performing the services, not to exceed 180 days, or a shorter period consistent with the purposes of this title as may be prescribed by the Department of Financial Protection and Innovation.(4) The credit services organizations principal business address and the name and address of its agent, other than the Secretary of State, in the State of California, authorized to receive service of process.(b) The contract shall be accompanied by a completed form in duplicate, captioned Notice of Cancellation, which shall be attached to the contract and easily detachable, and which shall contain in type of at least 10-point the following statement written in the same language as used in the contract:Notice of CancellationYou may cancel this contract, without any penalty or obligation, before midnight on the fifth working day after you sign it.If you cancel, any payment made by you under this contract must be returned within 15 days following receipt by the seller of your cancellation notice.To cancel this contract, mail or deliver a signed and dated copy of this cancellation notice, or any other written notice, to _____ (name of seller) _____ at _____ (address of seller)(place of business) _____ not later than midnight (date).I hereby cancel this transaction.(date) _____ (purchasers signature) _____ A copy of the fully completed contract and all other documents the credit services organization requires the buyer to sign shall be given to the consumer at the time they are signed.(c) This section shall become operative on January 1, 2023.SEC. 41. Section 1789.19 of the Civil Code is amended to read:1789.19. (a) Any waiver by a buyer of the provisions of this title shall be deemed contrary to public policy and shall be void and unenforceable. Any attempt by a credit services organization to have a buyer waive rights given by this title shall constitute a violation of this title.(b) In any proceeding involving this title, the burden of proving an exemption or an exception from a definition is upon the person claiming it.(c) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 42. Section 1789.19 is added to the Civil Code, to read:1789.19. (a) Any waiver by a consumer of the provisions of this title shall be deemed contrary to public policy and shall be void and unenforceable. Any attempt by a credit services organization to have a consumer waive rights given by this title shall constitute a violation of this title.(b) In any proceeding involving this title, the burden of proving an exemption or an exception from a definition is upon the person claiming it.(c) This section shall become operative on January 1, 2023.SEC. 43. Section 1789.21 of the Civil Code is amended to read:1789.21. (a) Any buyer injured by a violation of this title or by the credit services organizations breach of a contract subject to this title may bring any action for recovery of damages, or for injunctive relief, or both. Judgment shall be entered for actual damages, but in no case less than the amount paid by the buyer to the credit services organization, plus reasonable attorneys fees and costs. An award, if the trial court deems it proper, may be entered for punitive damages.(b) Any person, including, but not limited to, a consumer credit reporting agency, as defined in subdivision (d) of Section 1785.3, and any consumer of, or user of, a consumer credit report under the Consumer Credit Reporting Agencies Act (Title 1.6 (commencing with Section 1785.1)), and any furnisher of credit information under the Consumer Credit Reporting Agencies Act, may bring an action for the recovery of damages or for injunctive relief, or both, for a violation of this title. Any person bringing such an action who prevails in the action shall be entitled to reasonable attorneys fees and costs.(c) This section shall remain in effect until January 1, 2023, and as of that date is repealed.SEC. 44. Section 1789.21 is added to the Civil Code, to read:1789.21. (a) Any consumer injured by a violation of this title or by the credit services organizations breach of a contract subject to this title may bring any action for recovery of damages, or for injunctive relief, or both. Judgment shall be entered for actual damages, but in no case less than the amount paid by the consumer to the credit services organization, plus reasonable attorneys fees and costs. An award, if the trial court deems it proper, may be entered for punitive damages.(b) Any credit services organization that willfully and knowingly violates this title with respect to any consumer, in addition to any damages awarded pursuant to subdivision (a), shall also be liable to the consumer, in an individual action, for a civil penalty of not less than one hundred dollars ($100) and not greater than one thousand dollars ($1,000), to be determined by the court.(c) Any person, including, but not limited to, a consumer credit reporting agency, as defined in subdivision (d) of Section 1785.3, and any consumer of, or user of, a consumer credit report under the Consumer Credit Reporting Agencies Act (Title 1.6 (commencing with Section 1785.1)), and any furnisher of credit information under the Consumer Credit Reporting Agencies Act, may bring an action for the recovery of damages or for injunctive relief, or both, for a violation of this title. Any person bringing such an action who prevails in the action shall be entitled to reasonable attorneys fees and costs.(d) This section shall become operative on January 1, 2023.SEC. 45. Section 1789.25 of the Civil Code is amended to read:1789.25. (a) Every credit services organization shall file a registration application with, and receive a certificate of registration from, the Department of Justice before conducting business in this state. The Department of Justice shall not issue a certificate of registration until the bond required by Section 1789.18 has been filed with the office of the Secretary of State and the department establishes that the organization seeking a certificate satisfies the requirements of subdivision (f). The application shall be accompanied by a registration fee of one hundred dollars ($100). The registration application shall contain all of the following information:(1) The name and address where business is actually conducted of the credit services organization.(2) The names, addresses, and drivers license numbers of any and all persons who directly or indirectly own or control 10 percent or more of the outstanding shares of stock in the credit services organization.(3) Either of the following:(A) A full and complete disclosure of any litigation commenced against the credit services organization or any resolved or unresolved complaint that relates to the operation of the credit services organization and that is filed with the Attorney General or any other governmental authority of this state, any other state, or the federal government. With respect to each resolved complaint identified by the disclosure, the disclosure shall include a brief description of the resolution.(B) An acknowledged declaration under penalty of perjury stating that no litigation has been commenced and no unresolved complaint relating to the operation of the organization has been filed with the Attorney General or any other governmental authority of this state, any other state, or the federal government.(4) Other information that the Department of Justice requires, either at the time of application or thereafter.(b) The Department of Justice may conduct an investigation to verify the accuracy of the registration application. If the application involves investigation outside this state, the applicant credit services organization may be required by the Department of Justice to advance sufficient funds to pay the actual expenses of the investigation. Any nonresident applying for registration under this section shall designate and maintain a resident of this state as the applicants agent for the purpose of receipt of service of process.(c) Each credit services organization shall notify the Department of Justice in writing within 30 days after the date of a change in the information required by subdivision (a), except that 30 days advance notice and approval by the Department of Justice shall be required before changing the corporate name or address, or persons owning more than 10 percent of the shares of stock in the organization. Each credit services organization registering under this section may use no more than one fictitious or trade name and shall maintain a copy of the registration application in its files. The organization shall allow a buyer to inspect the registration application upon request.(d) A certificate of registration issued pursuant to this section shall expire annually on the last day of December but may be renewed by filing a renewal application accompanied by a fee not to exceed the Department of Justices costs of administration.(e) The credit services organization shall attach to the registration statement a copy of the contract or contracts which the credit services organization intends to execute with its customers and a copy of the required bond.(f) The Department of Justice shall not issue a certificate of registration under this title to any person who has engaged in, or proposes to engage in, any activity that is in violation of Section 1789.13, any law prohibiting the use of untrue or misleading statements, or any law related to the extension of credit to persons for personal, family, or household purposes.(g) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 46. Section 1789.25 is added to the Civil Code, to read:1789.25. (a) Every credit services organization shall file an application for licensure with, and receive a license from, the Department of Financial Protection and Innovation before conducting business in this state. The Department of Financial Protection and Innovation shall not issue a license until the bond required by Section 1789.18 has been filed with the Office of the Secretary of State and the department establishes that the organization seeking a license satisfies the requirements of subdivision (f). The application shall be accompanied by a license fee of one hundred dollars ($100). The Department of Financial Protection and Innovation may, periodically, increase the fee, but the amount of the fee shall not exceed that which is reasonable and necessary to satisfy its costs in complying with its duties under this title to regulate credit services organizations. The application shall contain all of the following information:(1) The name and address where business is actually conducted of the credit services organization.(2) The names, addresses, and drivers license numbers of any and all persons who directly or indirectly own or control 10 percent or more of the outstanding shares of stock in the credit services organization.(3) Either of the following:(A) A full and complete disclosure of any litigation commenced against the credit services organization or any resolved or unresolved complaint that relates to the operation of the credit services organization and that is filed with the Department of Financial Protection and Innovation, the Attorney General, or any other governmental authority of this state, any other state, or the federal government. With respect to each resolved complaint identified by the disclosure, the disclosure shall include a brief description of the resolution.(B) An acknowledged declaration under penalty of perjury stating that no litigation has been commenced and no unresolved complaint relating to the operation of the organization has been filed with the Department of Financial Protection and Innovation, the Attorney General, or any other governmental authority of this state, any other state, or the federal government.(4) Other information that the Department of Financial Protection and Innovation requires, either at the time of application or thereafter.(b) The Department of Financial Protection and Innovation may conduct an investigation to verify the accuracy of the licensure application. If the application involves investigation outside this state, the applicant credit services organization may be required by the Department of Financial Protection and Innovation to advance sufficient funds to pay the actual expenses of the investigation. Any nonresident applying for licensure under this section shall designate and maintain a resident of this state as the applicants agent for the purpose of receipt of service of process.(c) Each credit services organization shall notify the Department of Financial Protection and Innovation in writing within 30 days after the date of a change in the information required by subdivision (a), except that 30 days advance notice and approval by the Department of Financial Protection and Innovation shall be required before changing the corporate name or address, or persons owning more than 10 percent of the shares of stock in the organization. Each credit services organization applying for licensure under this section may use no more than one fictitious or trade name and shall maintain a copy of the license application in its files. The organization shall allow a buyer to inspect the license application upon request.(d) A license issued pursuant to this section shall expire one year after it was issued, but may be renewed by filing a renewal application accompanied by a fee in an amount to be determined annually by the Department of Financial Protection and Innovation as is reasonable and necessary to satisfy its costs in complying with its duties under this title to regulate credit services organizations. The Department of Financial Protection and Innovation may, periodically, increase the fee, but the amount of the fee shall not exceed that which is reasonable and necessary to satisfy its costs in complying with its duties under this title to regulate credit services organizations.(e) The credit services organization shall attach to the license statement a copy of the contract or contracts which the credit services organization intends to execute with its customers and a copy of the required bond.(f) The Department of Financial Protection and Innovation shall not issue a license under this title to any person who has engaged in, or proposes to engage in, any activity that is in violation of Section 1789.13, any law prohibiting the use of untrue or misleading statements, or any law related to the extension of credit to persons for personal, family, or household purposes.(g) The Department of Financial Protection and Innovation shall maintain on a publicly available internet website a list of the credit services organizations that are licensed in this state.(h) This section shall become operative on January 1, 2023.SEC. 47. The Legislature finds and declares that Section 30 of this act, which adds Section 1789.12.35 of the Civil Code, imposes a limitation on the publics right of access to the meetings of public bodies or the writings of public officials and agencies within the meaning of Section 3 of Article I of the California Constitution. Pursuant to that constitutional provision, the Legislature makes the following findings to demonstrate the interest protected by this limitation and the need for protecting that interest:Protecting from public disclosure limited confidential information provided by licensees to the Commissioner of the Department of Financial Protection and Innovation properly balances protecting legitimate private economic interests and public interests in effective regulation. SEC. 48. No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIIIB of the California Constitution. |
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| 64 | + | The people of the State of California do enact as follows:SECTION 1. Section 1789.11 of the Civil Code is amended to read:1789.11. The Legislature finds and declares that:(a) The ability to obtain and use credit has become of great importance to consumers, who have a vital interest in establishing and maintaining their credit worthiness and credit standing. As a result, consumers who have experienced credit problems may seek assistance from credit services organizations which offer to obtain credit or improve the credit standing of such consumers.Certain advertising and business practices of some credit services organizations have worked a financial hardship upon the people of this state, often those who are of limited economic means and inexperienced in credit matters. Credit services organizations have significant impact upon the economy and well-being of this state and its people.(b) The purposes of this title are to provide prospective buyers of services of credit services organizations with the information necessary to make an intelligent decision regarding the purchase of those services and to protect the public from unfair or deceptive advertising and business practices.(c) This title shall be construed liberally to achieve these purposes.(d) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 2. Section 1789.11 is added to the Civil Code, to read:1789.11. The Legislature finds and declares that:(a) The ability to obtain and use credit has become of great importance to consumers, who have a vital interest in establishing and maintaining their credit worthiness and credit standing. As a result, consumers who have experienced credit problems may seek assistance from credit services organizations which offer to obtain credit or improve the credit standing of such consumers.Certain advertising and business practices of some credit services organizations have worked a financial hardship upon the people of this state, often those who are of limited economic means and inexperienced in credit matters. Credit services organizations have significant impact upon the economy and well-being of this state and its people.(b) The purposes of this title are to license, regulate, and oversee licensees, to provide prospective consumers of services of credit services organizations with the information necessary to make an intelligent decision regarding the purchase of those services and to protect the public from unfair or deceptive advertising and business practices.(c) This title shall be construed liberally to achieve these purposes.(d) This section shall become operative on January 1, 2023.SEC. 3. Section 1789.11.1 is added to the Civil Code, to read:1789.11.1. (a) Beginning on January 1, 2022, the Department of Financial Protection and Innovation shall take all action necessary to prepare to be able, commencing on January 1, 2023, to fully enforce the licensing and regulatory provisions of this title, including, but not limited to, adoption of all necessary regulations.(b) The Department of Financial Protection and Innovation shall allow any credit services organization that submits an application for licensure before January 1, 2023, to operate pending the denial or approval of the application.SEC. 4. Section 1789.11.3 is added to the Civil Code, to read:1789.11.3. (a) No city, county, city and county, or other political subdivision within this state shall require a credit services organization to be licensed.(b) This section shall become operative on January 1, 2023.SEC. 5. Section 1789.11.5 is added to the Civil Code, to read:1789.11.5. (a) No person shall provide credit services in this state without first obtaining a license pursuant to this title. A person is acting in this state if the person is located in this state and is seeking to provide credit services to a consumer that resides inside or outside the state, or is located outside of the state and is seeking to provide credit services to a consumer that resides in this state. (b) A license shall be obtained for the licensees principal place of business and shall not be transferred or assigned.(c) A separate license is not required for each individual branch office.(d) This section shall become operative on January 1, 2023.SEC. 6. Section 1789.12 of the Civil Code is amended to read:1789.12. As used in this title:(a) Credit services organization means a person who, with respect to the extension of credit by others, sells, provides, or performs, or represents that he or she the person can or will sell, provide or perform, any of the following services, in return for the payment of money or other valuable consideration:(1) Improving a buyers credit record, history, or rating.(2) Obtaining a loan or other extension of credit for a buyer.(3) Providing advice or assistance to a buyer with regard to either paragraph (1) or (2).(b) Credit services organization does not include any of the following:(1) Any person holding a license to make loans or extensions of credit pursuant to the laws of this state or the United States who is subject to regulation and supervision with respect to the making of those loans or extensions of credit by an official or agency of this state or the United States and whose business is the making of those loans or extensions of credit.(2) Any bank, as defined in Section 102 103 of the Financial Code, or any savings institution, as specified in subdivision (a) or (b) of Section 5102 of the Financial Code, whose deposits or accounts are eligible for insurance by the Federal Deposit Insurance Corporation.(3) Any person licensed as a prorater by the Department of Business Oversight when the person is acting within the course and scope of that license.(4)Any person licensed as a real estate broker performing an act for which a real estate license is required under the Real Estate Law (Pt. 1 (commencing with Sec. 10000), Div. 4, B. & P.C.) and who is acting within the course and scope of that license.(4) Any person licensed as a real estate broker performing an act for which a real estate license is required under the Real Estate Law (Part 1 (commencing with Section 10000) of Division 4 of the Business and Professions Code) and who is acting within the course and scope of that license(5) Any attorney licensed to practice law in this state, where the attorney renders services within the course and scope of the practice of law, unless the attorney is an employee of, or otherwise directly affiliated with, a credit services organization.(6) Any broker-dealer registered with the Securities and Exchange Commission or the Commodity Futures Trading Commission where the broker-dealer is acting within the course and scope of the regulation.(7) Any nonprofit organization described in Section 501(c)(3) of the Internal Revenue Code that, according to a final ruling or determination by the Internal Revenue Service, is both of the following:(A) Exempt from taxation under Section 501(a) of the Internal Revenue Code.(B) Not a private foundation as defined in Section 509 of the Internal Revenue Code.An advance ruling or determination of tax-exempt or foundation status by the Internal Revenue Service does not meet the requirements of this paragraph.(c) Buyer means any natural person who is solicited to purchase or who purchases the services of a credit services organization.(d) Extension of credit means the right to defer payment of debt or to incur debt and defer its payment, offered or granted primarily for personal, family, or household purposes.(e) Consumer credit reporting agency means a consumer credit reporting agency subject to the Consumer Credit Reporting Agencies Act, Title 1.6 (commencing with Section 1785.1).(f) Person includes an individual, corporation, partnership, joint venture, or any business entity.(g) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 7. Section 1789.12 is added to the Civil Code, to read:1789.12. (a) As used in this title:(1) Applicant means a person who has applied for a license pursuant to this title.(2) Commissioner means the Commissioner of the Department of Financial Protection and Innovation.(3) Communication means the conveyance of any information regarding a debt, credit record, credit history, or credit rating, directly or indirectly, to any person by any means or through any medium.(4) Consumer means any natural person who resides in California and is solicited to purchase or who purchases the services of a credit services organization.(5) Consumer credit reporting agency has the same meaning as in Section 1785.3.(6) (A) Credit services organization means a person who, with respect to the extension of credit by others, sells, provides, or performs, or represents that the person can or will sell, provide, or perform, any of the following services, in return for the payment of money or other valuable consideration:(i) Improving a consumers credit record, history, or rating.(ii) Obtaining a loan or other extension of credit for a consumer.(iii) Providing advice or assistance to a consumer with regard to either clause (i) or (ii).(B) Credit services organization does not include any of the following:(i) Any person holding a license to make loans or extensions of credit pursuant to the laws of this state or the United States who is subject to regulation and supervision with respect to the making of those loans or extensions of credit by an official or agency of this state or the United States and whose business is the making of those loans or extensions of credit.(ii) Any bank, as defined in Section 103 of the Financial Code, or any savings institution, as specified in subdivision (a) or (b) of Section 5102 of the Financial Code, whose deposits or accounts are eligible for insurance by the Federal Deposit Insurance Corporation.(iii) Any person licensed as a prorater by the Department of Financial Protection and Innovation when the person is acting within the course and scope of that license.(iv) Any person licensed as a real estate broker performing an act for which a real estate license is required under the Real Estate Law (Part 1 (commencing with Section 10000) of Division 4 of the Business and Professions Code) and who is acting within the course and scope of that license.(v) Any attorney licensed to practice law in this state, where the attorney renders services within the course and scope of the practice of law, unless the attorney is an employee of, or otherwise directly affiliated with, a credit services organization.(vi) Any broker-dealer registered with the Securities and Exchange Commission or the Commodity Futures Trading Commission where the broker-dealer is acting within the course and scope of the regulation.(vii) Any nonprofit organization described in Section 501(c)(3) of the Internal Revenue Code that, according to a final ruling or determination by the Internal Revenue Service, is both of the following:(I) Exempt from taxation under Section 501(a) of the Internal Revenue Code.(II) Not a private foundation as defined in Section 509 of the Internal Revenue Code.An advance ruling or determination of tax-exempt or foundation status by the Internal Revenue Service does not meet the requirements of this paragraph.(7) Data Furnisher has the same meaning as the term furnisher is defined in Section 660.2 of Title 16 of the Code of Federal Regulations.(8) Department means the Department of Financial Protection and Innovation.(9) Extension of credit means the right to defer payment of debt or to incur debt and defer its payment, offered or granted primarily for personal, family, or household purposes.(10) Fund means the Credit Services Organization Licensing Fund established pursuant to Section 1789.12.13.(11) Licensee means a person licensed pursuant to this chapter.(12) Nationwide Multistate Licensing System and Registry means a system of record, created by the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators, for nondepository, financial services licensing or registration in participating state agencies, the District of Colombia, Puerto Rico, the United States Virgin Islands, and Guam.(13) Person includes a natural person, corporation, partnership, limited liability company, joint venture, or any business entity.(b) This section shall become operative on January 1, 2023.SEC. 8. Section 1789.12.1 is added to the Civil Code, to read:1789.12.1. (a) The commissioner shall administer this title and may adopt rules and regulations, and issue orders, consistent with that authority.(b) Without limitation, the functions, powers, and duties of the commissioner include all of the following:(1) To issue or to refuse to issue a license as provided in this title.(2) To allow affiliated companies to be under a single license. The commissioner shall adopt regulations specifying what constitutes an affiliated company for these purposes.(3) To keep records of licenses issued under this title.(4) To receive, consider, investigate, and act upon a complaint made in connection with a licensee.(5) To prescribe the form of and to receive applications for licenses and reports, books, and records required to be made or retained by a licensee.(6) To subpoena documents and witnesses, and to compel their attendance and production, to administer oaths, and to require the production of books, papers, or other materials relevant to any inquiry authorized by this title.(7) To require information with regard to an applicant that the commissioner may deem necessary, with regard for the paramount public interest in ascertaining the experience, background, honesty, truthfulness, integrity, and competency of an applicant for providing credit services, and if an applicant is an entity other than an individual, in ascertaining the honesty, truthfulness, integrity, and competency of officers, directors, or managing members of the corporation, association, or other entity, or the general patterns of a partnership.(8) To enforce by order any provision of this title.(9) To levy fees, fines, and charges in an amount sufficient to cover the cost of the services performed in administering this title. The fees collected pursuant to this title shall not exceed the costs of administering this title.(c) This section shall become operative on January 1, 2023.SEC. 9. Section 1789.12.3 is added to the Civil Code, to read:1789.12.3. (a) The proceedings for a revocation of a license shall be conducted in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code.(b) The commissioner may suspend or revoke a license if, after notice and an opportunity for hearing, the commissioner finds any of the following:(1) The licensee violated this title or a regulation adopted or an order issued under this title.(2) The licensee does not cooperate with an examination or investigation by the commissioner.(3) The licensee is insolvent, suspends payment of its obligations, or makes a general assignment for the benefit of its creditors.(4) A receiver, liquidator, or conservator has been appointed for a licensee.(5) Any fact or condition exists that, if it had existed at the time that the licensee applied for the license, would have been grounds for denying the application.(c) This section shall become operative on January 1, 2023.SEC. 10. Section 1789.12.5 is added to the Civil Code, to read:1789.12.5. (a) Notwithstanding any law the commissioner shall have the authority to conduct investigations and examinations of an applicant or licensee as follows:(1) For purposes of determining whether an applicant is eligible for a license, or that a licensee is complying with the provisions of this title or any regulation or order of the commissioner, the commissioner may access, receive, and use any books, accounts, records, files, documents, information, or evidence that relates to the licensees credit services, including, but not limited to, any of the following relating to the intent to, or the practice of, providing credit services:(A) Criminal, civil, and administrative history information.(B) Personal history and experience information, including, but not limited to, independent credit reports obtained from a consumer reporting agency.(C) Any other documents, information, or evidence that the commissioner deems relevant to the inquiry or investigation regardless of the location, possession, control, or custody of those documents, information, or evidence.(2) For the purposes of investigating violations or complaints arising under this title, the commissioner may direct, subpoena, or order the attendance of, and examine under oath, any person whose testimony may be required about the consumer or the credit services organization.(b) In making any examination or investigation authorized by this section, the commissioner may control access to any documents and records of the licensee or person under examination or investigation. The commissioner may take possession of the documents and records or place a person in exclusive charge of the documents and records in the place where they are usually kept. During the period of control, no person shall remove or attempt to remove any of the documents and records except pursuant to a court order or with the consent of the commissioner. Unless the commissioner has reasonable grounds to believe the documents or records of a licensee have been, or are at risk of being, altered or destroyed for purposes of concealing a violation of this title, the licensee or owner of the documents and records shall have access to the documents or records as necessary to conduct their ordinary business affairs.(c) The commissioner may permit affiliated companies to be subject to a single examination. The department shall list all affiliated company names on the license and shall post them on the departments internet website.(d) This section shall become operative on January 1, 2023.SEC. 11. Section 1789.12.7 is added to the Civil Code, to read:1789.12.7. (a) If, in the opinion of the commissioner, a person who is required to be licensed under this title is engaged in the business of providing credit services without a license from the commissioner, or a person or licensee has violated any provision of this title, an order, or a regulation adopted pursuant to this title, the commissioner may do any of the following:(1) After notice and an opportunity for a hearing, order the person or licensee to desist and to refrain from engaging in the business of further continuing the violation.(2) After notice and an opportunity for a hearing, order the person or licensee to pay ancillary relief. The ancillary relief may include, but need not be limited to, refunds, restitution, disgorgement, and payment of damages, as appropriate, on behalf of a person injured by the conduct or practice that constitutes the subject matter of the assessment.(b) If, within 30 days after an order issued pursuant to subdivision (a) or (b) is served, a written request for a hearing is filed and no hearing is held within 30 days thereafter, the order shall be deemed rescinded.(c) This section shall become operative on January 1, 2023.SEC. 12. Section 1789.12.9 is added to the Civil Code, to read:1789.12.9. (a) Notwithstanding any law, the commissioner may by rule or order prescribe circumstances under which to accept electronic records or electronic signatures. This section shall not be deemed to require the commissioner to accept electronic records or electronic signatures.(b) For purposes of this section, the following terms have the following meanings:(1) Electronic record means an initial license application, or material modification of that license application, and any other record created, generated, sent, communicated, received, or stored by electronic means. Electronic record also includes, but is not limited to, all of the following electronic documents:(A) An application, amendment, supplement, and exhibit, filed for any license, consent, or other authority.(B) A financial statement, report, or advertising.(C) A surety bond, rider, or endorsement thereto.(D) An order, license, consent, or other authority.(E) A notice of public hearing, accusation, and statement of issues in connection with any application, license, consent, or other authority.(F) A proposed decision of a hearing officer and a decision of the commissioner.(G) The transcripts of a hearing and correspondence between a party and the commissioner directly relating to the record.(H) A release, newsletter, interpretive opinion, determination, or specific ruling.(I) Correspondence between a party and the commissioner directly relating to any document listed in subparagraphs (A) to (H), inclusive.(2) Electronic signature means an electronic sound, symbol, or process attached to or logically associated with an electronic record and executed or adopted by a person with the intent to sign the electronic record.(c) The Legislature finds and declares that the Department has continuously implemented methods to accept records filed electronically, and is encouraged to continue to expand its use of electronic filings to the extent feasible, as budget, resources, and equipment are made available to accomplish that goal. (d) This section shall become operative on January 1, 2023.SEC. 13. Section 1789.12.11 is added to the Civil Code, to read:1789.12.11. (a) The commissioner may require an applicant for a license to make some or all of the filings with the commissioner through the Nationwide Multistate Licensing System and Registry.(b) The commissioner may require an application to be made through the Nationwide Multistate Licensing System and Registry, and may require fees, fingerprints, financial statements, supporting documents, changes of address, and any other information, and amendments or modifications thereto, to be submitted by applicants and licensees through the Nationwide Multistate Licensing System and Registry.(c) The commissioner may require licensees to pay annual fees through the Nationwide Multistate Licensing System and Registry.(d) This section shall become operative on January 1, 2023.SEC. 14. Section 1789.12.13 is added to the Civil Code, to read:1789.12.13. (a) The Credit Services Licensing Fund is hereby established within the state treasury.(b) All licensing fees collected shall be deposited into the Fees Account which is hereby established within the fund.(c) All fines and penalties collected shall be deposited into the Penalties Account which is hereby established within the fund.(d) All monies deposited into the fund shall be available to the commissioner, upon appropriation by the Legislature, for the purposes of this title. (e) This section shall become operative on January 1, 2023.SEC. 15. Section 1789.12.15 is added to the Civil Code, to read:1789.12.15. An applicant shall apply for a license by submitting all of the following to the commissioner:(a) A completed application for a license in a form prescribed by the commissioner and signed under penalty of perjury. Every application shall include the location of the applicants principal place of business and all branch office locations.(b) An application fee and investigation fee, the amount of which shall be determined by the department, to cover any costs incurred in processing an application, including a fingerprint processing and criminal history record check under Section 1789.12.7. The investigation fee, including the amount for the criminal history record check, and the application fee are not refundable if an application is denied or withdrawn.(c) This section shall become operative on January 1, 2023.SEC. 16. Section 1789.12.17 is added to the Civil Code, to read:1789.12.17. (a) The commissioner shall submit to the Department of Justice fingerprint images and related information required by the Department of Justice of every applicant, as defined in paragraph (1) of subdivision (a) of Section 1789.12, for purposes of obtaining information as to the existence and content of a record of state or federal convictions, state or federal arrests, and information as to the existence and content of a record of state or federal arrests for which the Department of Justice establishes that the person is free on bail or on their own recognizance pending trial or appeal.(b) When received, the Department of Justice shall transmit fingerprint images and related information received pursuant to this section to the Federal Bureau of Investigation for the purpose of obtaining a federal criminal history records check. The Department of Justice shall review the information returned from the Federal Bureau of Investigation and compile and disseminate a response to the commissioner.(c) The Department of Justice shall provide a state or federal response to the commissioner pursuant to paragraph (1) of subdivision (p) of Section 11105 of the Penal Code.(d) The commissioner shall request from the Department of Justice subsequent arrest notification service, as provided pursuant to Section 11105.2 of the Penal Code, for the license applicant described in subdivision (a).(e) The Department of Justice shall charge a fee, payable by the applicant, sufficient to cover the costs of processing the requests pursuant to this section.(f) This section shall become operative on January 1, 2023.SEC. 17. Section 1789.12.19 is added to the Civil Code, to read:1789.12.19. (a) (1) Upon the filing of an application for a license pursuant to Section 1789.25 and the payment of the fees, if the applicant is a partnership, the commissioner shall investigate the applicant and its general partners and individuals owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or any individual responsible for the conduct of the applicants servicing activities in this state.(2) Upon the filing of an application for a license pursuant to Section 1789.25 and the payment of the fees, if the applicant is a corporation, trust, limited liability company, or association, including an unincorporated organization, the commissioner shall investigate the applicant, its principal officers, directors, trustee, managing members, and individuals owning or controlling, directly or indirectly, 10 percent or more of the outstanding equity securities or any individual responsible for the conduct of the applicants credit services in this state.(b) Upon the filing of an application for a license pursuant to Section 1789.25 and the payment of the fees, the commissioner shall investigate the individual responsible for the credit services of the licensee at the location described in the application. The investigation may be limited to information that was not included in prior applications filed pursuant to this title.(c) For the purposes of this section, principal officers shall mean president, chief executive officer, treasurer, and chief financial officer, as may be applicable, and any other officer with direct responsibility for the conduct of the applicants credit services in this state.(d) This section shall become operative on January 1, 2023.SEC. 18. Section 1789.12.21 is added to the Civil Code, to read:1789.12.21. (a) When the application is complete, including the information from the Department of Justice, and the commissioner determines that the applicant has satisfied the requirements set forth in this title and does not find facts constituting reasons for denial, the commissioner shall issue and deliver a license to the applicant.(b) If the commissioner determines that the requirements have not been satisfied, after notice and an opportunity for a hearing, the commissioner may deny the application and shall provide a written explanation for the denial.(c) This section shall become operative on January 1, 2023.SEC. 19. Section 1789.12.23 is added to the Civil Code, to read:1789.12.23. (a) The proceedings for a denial of a license shall be conducted in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code.(b) After notice and an opportunity for a hearing, the commissioner may deny an application for a license for any of the following reasons:(1) A false statement of a material fact has been made in the application.(2) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, within the last 10 years has (A) been convicted of, or pleaded nolo contendere to, a crime, other than traffic violations, or (B) committed any act involving dishonesty, fraud, or deceit, if the crime or act is substantially related to the qualifications, functions, or duties of a person engaged in business in accordance with this title.(3) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, has violated, or is not in material compliance with this title, or an order or rule of the commissioner.(4) A material requirement for issuance of a license has not been met, provided that a written notice of a material omission shall first be sent to the applicant with an opportunity to correct the omission prior to the applicants denial.(5) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, has violated this title or the rules thereunder, or any similar regulatory scheme of this or a foreign jurisdiction.(6) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, has been held liable by final judgment in a civil action under this title.(7) The commissioner, based on its investigation of the applicant, is unable to find that the financial responsibility, criminal records, experience, character, and general fitness of the applicant and its general partners, managing members, principal officers and directors, and individuals owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, support a finding that the business will be operated honestly, fairly, efficiently, and in accordance with the requirements of this title.(8) The commissioner may adopt regulations specifying the factors that the commissioner will consider in denying a license, including, but not limited to, the harm to the consumer, the frequency of prior violations, and the number of prior disciplinary actions taken against the licensee in California or in other states.(c) This section shall become operative on January 1, 2023.SEC. 20. Section 1789.12.25 is added to the Civil Code, to read:1789.12.25. (a) The commissioner may deem an application for a license abandoned if the applicant fails to respond to any request for information required by the commissioner or department during an investigation of the application.(b) The commissioner shall notify the applicant, in writing, that if the applicant fails to submit responsive information within 60 days from the date the commissioner sent the written request for information, the commissioner shall deem the application abandoned.(c) An application fee paid prior to the date an application is deemed abandoned shall not be refunded. Abandonment of an application pursuant to this subdivision shall not preclude the applicant from submitting a new application and fee for a license.(d) This section shall become operative on January 1, 2023.SEC. 21. Section 1789.12.27 is added to the Civil Code, to read:1789.12.27. (a) A license shall remain effective until the license is either suspended or revoked by the commissioner or surrendered by the licensee.(b) This section shall become operative on January 1, 2023.SEC. 22. Section 1789.12.29 is added to the Civil Code, to read:1789.12.29. (a) The commissioner is authorized to establish relationships or contracts with the Nationwide Multistate Licensing System and Registry or other entities designated by the Nationwide Multistate Licensing System and Registry to collect and maintain records and process transaction fees or other fees related to licensees or other persons subject to this title.(b) For the purpose of participating in the Nationwide Multistate Licensing System and Registry, the commissioner is authorized to waive or modify, in whole or in part, by rule, regulation, or order, any or all of the requirements of this title and to establish new requirements as reasonably necessary to participate in the Nationwide Multistate Licensing System and Registry.(c) The commissioner may use the Nationwide Multistate Licensing System and Registry as a channeling agent for requesting information from, and distributing information to, the Department of Justice, any other governmental agency, or any other source, as directed by the commissioner.(d) The commissioner shall establish a process through which applicants and licensees may challenge information entered into the Nationwide Multistate Licensing System and Registry by the commissioner.(e) This section shall become operative on January 1, 2023.SEC. 23. Section 1789.12.31 is added to the Civil Code, to read:1789.12.31. (a) Except as otherwise provided in Section 1512 of the SAFE Act (12 U.S.C. Sec. 5111(a)), the requirements under any federal law or the Information Practices Act of 1977 (Chapter 1 (commencing with Section 1798) of Part 4 of Division 3 of the Civil Code) regarding the privacy or confidentiality of any information or material provided to the Nationwide Multistate Licensing System and Registry, and any privilege arising under federal or state law, including the rules of any state court, with respect to that information or material, shall continue to apply to the information or material after the information or material has been disclosed to the Nationwide Multistate Licensing System and Registry. The information and material may be shared with all state and federal regulatory officials with industry oversight authority without the loss of privilege or the loss of confidentiality protections provided by federal law or the Information Practices Act.(b) Information or material that is subject to a privilege or confidentiality under subdivision (a) shall not be subject to any of the following:(1) Disclosure under any federal or state law governing the disclosure to the public of information held by an officer or an agency of the federal government or the state.(2) Subpoena or discovery, or admission into evidence, in any private civil action or administrative process, unless with respect to any privilege held by the Nationwide Multistate Licensing System and Registry with respect to the information or material, the person to whom the information or material pertains waives, in whole or in part, in the discretion of that person, that privilege.(c) This section shall not apply with respect to the information or material relating to the employment history of, and publicly adjudicated disciplinary and enforcement actions included in, the Nationwide Multistate Licensing System and Registry for access by the public.(d) This section shall become operative on January 1, 2023.SEC. 24. Section 1789.12.33 is added to the Civil Code, to read:1789.12.33. (a) The commissioner shall report regularly violations of this title, as well as enforcement actions and other relevant information, to the Nationwide Multistate Licensing System and Registry, to the extent that the information is a public record.(b) This section shall become operative on January 1, 2023.SEC. 25. Section 1789.12.35 is added to the Civil Code, to read:1789.12.35. (a) A licensee shall notify the commissioner, in writing, of any change in the information provided in the application for a license, as applicable, not later than 30 days after the occurrence of the event that results in the information becoming inaccurate or incomplete.(b) (1) If a licensee seeks to change its place of business to a street address other than that designated in its license, the licensee shall provide written notice to the commissioner at least 10 days prior to the change.(2) A licensee shall not engage in the business of credit services at a new location in a name other than a name approved by the commissioner.(3) A licensee that opens a new branch office or changes the location of an existing branch office shall notify the commissioner in writing of the new or changed branch office location within 30 days after the branch office begins business.(c) This section shall become operative on January 1, 2023.SEC. 26. Section 1789.12.37 is added to the Civil Code, to read:1789.12.37. A licensee shall do all of the following:(a) Develop policies and procedures reasonably intended to promote compliance with this title.(b) File with the commissioner any report required by the commissioner.(c) Comply with the provisions of this title and any regulation or order of the commissioner.(d) Submit to periodic examination by the commissioner as required by this title and any regulation or order of the commissioner.(e) Maintain a surety bond in accordance with this section in a minimum amount of twenty-five thousand dollars ($25,000). The bond shall be payable to the commissioner and issued by an insurer authorized to do business in this state. The surety bond, including any and all riders and endorsements executed subsequent to the effective date of the bond, shall be filed with the commissioner within 10 days of execution. The bond shall be used for the recovery of expenses, fines, and fees levied by the commissioner in accordance with this title. The commissioner may require licensees to submit bonds, riders, and endorsements electronically through the Nationwide Multistate Licensing System and Registrys electronic surety bond function.(1) When an action is commenced on a licensees bond, the commissioner may require the filing of a new bond. Immediately upon recovery of any action on the bond, the licensee shall file a new bond. Failure to file a new bond within 10 days of the recovery on a bond, or within 10 days after notification by the commissioner that a new bond is required, constitutes sufficient grounds for the suspension or revocation of the license. A licensee may provide the commissioner a refundable deposit in the amount of twenty-five thousand dollars ($25,000) in lieu of the bond while the licensee pursues a new bond.(2) The commissioner may require a higher bond amount for a licensee based on the number of affiliates under the license and the dollar amount of credit services performed by that licensee.(f) This section shall become operative on January 1, 2023.SEC. 27. Section 1789.12.39 is added to the Civil Code, to read:1789.12.39. (a) Each licensee shall pay to the commissioner its pro rata share of all costs and expenses reasonably incurred in the administration of this title, as estimated by the commissioner, for the ensuing year and any deficit actually incurred or anticipated in the administration of the title in the year in which the annual fee is levied. The pro rata share shall be based upon the proportion of net proceeds generated by California debtor accounts in the preceding year after the amount levied pursuant to subdivision (c).(b) On or before September 30 in each year, the commissioner shall notify each licensee of the amount of the annual fee schedule that will take effect on January 1. If payment is not made by January 1, the commissioner shall assess and collect a penalty, in addition to the fee, of 1 percent of the assessment for each month or part of a month that the payment is delayed or withheld.(c) In the levying and collection of the annual fees, a licensee shall neither be charged for nor be permitted to pay less than two hundred fifty dollars ($250) nor more than an aggregate of all reasonable costs to operate this title, with the exception of fees associated with investigations and examinations.(d) If a licensee fails to pay the annual fees on or before January 1, the commissioner may by order summarily suspend or revoke the license issued to the licensee. If, after an order is made, a request for hearing is filed in writing within 30 days, and a hearing is not held within 60 days thereafter, the order is deemed rescinded as of its effective date. During any period when the license is revoked or suspended, a licensee shall not engage in the business of credit services in this state pursuant to this title except as may be permitted by order of the commissioner. However, the revocation, suspension, or surrender of a license shall not affect the powers of the commissioner as provided in this title.(e) Notwithstanding subdivisions (a) to (d), inclusive, the commissioner may by rule require licensees to pay annual fees through the Nationwide Multistate Licensing System and Registry.(f) This section shall become operative on January 1, 2023.SEC. 28. Section 1789.12.41 is added to the Civil Code, to read:1789.12.41. (a) A licensee shall file an annual report with the commissioner, on or before March 15, that contains all relevant information that the commissioner reasonably requires concerning the business and operations conducted by the licensee in the state during the preceding calendar year, including information regarding credit services activity. The report shall, at minimum, require disclosure of all of the following information:(1) The total number of California consumers provided credit services in the preceding year.(2) The total dollar amount of credit services provided in the preceding year.(3) The face value dollar amount of credit services provided in the licensees portfolio in the preceding year.(4) The total dollar amount of California credit services provided in the preceding year, and the total dollar amount of outstanding debt that remains uncollected.(5) The total dollar amount of net proceeds generated by California consumers provided credit services in the preceding year.(6) The case number of any action in which the licensee was held liable by final judgment under this title.(b) The individual annual reports filed pursuant to this section shall be made available to the public for inspection.(c) The report shall be made under oath and in the form prescribed by the commissioner.(d) A licensee shall make other special reports that may be required by the commissioner.(e) This section shall become operative on January 1, 2023.SEC. 29. Section 1789.12.43 is added to the Civil Code, to read:1789.12.43. (a) A licensee that ceases to engage in providing credit services shall inform the commissioner in writing and surrender the license and all other indicia of license to the commissioner.(b) This section shall become operative on January 1, 2023.SEC. 30. Section 1789.12.45 is added to the Civil Code, to read:1789.12.45. (a) As often as the commissioner deems necessary and appropriate, the commissioner shall examine the affairs of each licensee for compliance with this title. The commissioner shall appoint suitable persons to perform the examination. The commissioner and their appointees may examine the books, records, and documents of the licensee, and may examine the licensees officers, directors, employees, or agents under oath regarding the licensees credit services.(b) The commissioner may cooperate with any agency of the state, the federal government, or other states in performing license examinations.(c) This section does not require the commissioner to conduct examinations at the business offices of licensees. Unless an onsite examination is considered necessary for the protection of the public, the commissioner may conduct some or all examinations without a site visit to the business office of a licensee, by requesting that licensees submit required books and records to the department electronically, via a secure portal.(d) Unless otherwise exempt pursuant to subparagraph (B) of paragraph (6) or subdivision (a) of Section 1789.12, affiliates of a licensee are subject to examination by the commissioner on the same terms as the licensee, but only when reports from, or examination of, a licensee provides documented evidence of unlawful activity between a licensee and affiliate benefitting, affecting, or arising from the activities regulated by this title.(e) The cost of each examination of a licensee shall be paid to the commissioner by the licensee examined, and the commissioner may maintain an action for the recovery of the cost in any court of competent jurisdiction. In determining the cost of the examination, the commissioner may use the estimated average hourly cost for all persons performing examinations of licensees or other persons subject to this title for the fiscal year.(f) The statement of the findings of an examination shall belong to the commissioner and shall not be disclosed to anyone other than the licensee, law enforcement officials, or other state or federal regulatory agencies for further investigation and enforcement. Reports required of licensees by the commissioner under this title and results of examinations performed by the commissioner under this title are the property of the commissioner.(g) The commissioner shall provide a written statement of the findings of the examination, issue a copy of that statement to the licensee and take appropriate steps to ensure correction of any violations of this title.(h) Notwithstanding any provision of this title, the commissioner shall have the authority to waive one or more branch office examinations, if the commissioner deems that the branch office examinations are not necessary for the protection of the public, due to the centralized operations of the licensee or other factors acceptable to the commissioner.(i) In any proceeding under this title, the burden of proving an exemption or an exception from a definition is upon the person claiming it.(j) This section shall become operative on January 1, 2023.SEC. 31. Section 1789.13 of the Civil Code is amended to read:1789.13. A credit services organization and its salespersons, agents, representatives, and independent contractors who sell or attempt to sell the services of a credit services organization shall not do any of the following:(a) Charge or receive any money or other valuable consideration prior to full and complete performance of the services the credit services organization has agreed to perform for or on behalf of the buyer.(b) Fail to perform the agreed services within six months following the date the buyer signs the contract for those services.(c) Charge or receive any money or other valuable consideration for referral of the buyer to a retail seller or other credit grantor who will or may extend credit to the buyer, if either of the following apply:(1) The credit that is or will be extended to the buyer (A) is upon substantially the same terms as those available to the general public or (B) is upon substantially the same terms that would have been extended to the buyer without the assistance of the credit services organization.(2) The money or consideration is paid by the credit grantor or is derived from the buyers payments to the credit grantor for costs, fees, finance charges, or principal.(d) Make, or counsel or advise a buyer to make, a statement that is untrue or misleading and that is known, or that by the exercise of reasonable care should be known, to be untrue or misleading, to a consumer credit reporting agency or to a person who has extended credit to a buyer or to whom a buyer is applying for an extension of credit, such as statements concerning a buyers identification, home address, creditworthiness, credit standing, or credit capacity.(e) Remove, or assist or advise the buyer to remove, adverse information from the buyers credit record which is accurate and not obsolete.(f) Create, or assist or advise the buyer to create, a new credit record by using a different name, address, social security number, or employee identification number.(g) Make or use untrue or misleading representations in the offer or sale of the services of a credit services organization, including either of the following:(1) Guaranteeing or otherwise stating that the organization is able to delete an adverse credit history, unless the representation clearly discloses, in a manner equally as conspicuous as the guarantee, that this can be done only if the credit history is inaccurate or obsolete and is not claimed to be accurate by the creditor who submitted the information.(2) Guaranteeing or otherwise stating that the organization is able to obtain an extension of credit, regardless of the buyers previous credit problems or credit history, unless the representation clearly discloses, in a manner equally as conspicuous as the guarantee, the eligibility requirements for obtaining an extension of credit.(h) Engage, directly or indirectly, in an act, practice, or course of business that operates or would operate as a fraud or deception upon a person in connection with the offer or sale of the services of a credit services organization.(i) Advertise or cause to be advertised, in any manner, the services of the credit services organization, without being registered with the Department of Justice.(j) Fail to maintain an agent for service of process in this state.(k) Transfer or assign its certificate of registration.(l) Submit a buyers dispute to a consumer credit reporting agency without the buyers knowledge.(m) Use a consumer credit reporting agencys telephone system or toll-free telephone number to represent the caller as the buyer in submitting a dispute of a buyer or requesting disclosure without prior authorization of the buyer.(n) Directly or indirectly extend credit to a buyer.(o) Refer a buyer to a credit grantor that is related to the credit services organization by a common ownership, management, or control, including a common owner, director, or officer.(p) Refer a buyer to a credit grantor for which the credit services organization provides, or arranges for a third party to provide, services related to the extension of credit such as underwriting, billing, payment processing, or debt collection.(q) Provide a credit grantor with an assurance that a portion of an extension of credit to a buyer referred by the credit services organization will be repaid, including providing a guaranty, letter of credit, or agreement to acquire a part of the credit grantors financial interest in the extension of credit.(r) Use a scheme, device, or contrivance to evade the prohibitions contained in this section.(s) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 32. Section 1789.13 is added to the Civil Code, to read:1789.13. (a) A credit services organization and its salespersons, agents, representatives, and independent contractors who sell or attempt to sell the services of a credit services organization shall not do any of the following:(1) Charge or receive any money or other valuable consideration prior to full and complete performance of the services the credit services organization has agreed to perform for or on behalf of the consumer.(2) Fail to perform the agreed services within 180 days following the date the consumer signs the contract for those services.(3) Fail to provide an itemized monthly statement to the consumer showing each service performed, including each call or written communication, and credit check made or sent on behalf of the consumer, and the date of each such service.(4) Fail to include in any written or digital communication to a consumer the California license number of the credit services organization in at least 12-point type.(5) Charge or receive any money or other valuable consideration for referral of the consumer to a retail seller or other credit grantor who will or may extend credit to the consumer, if either of the following apply:(A) The credit that is or will be extended to the consumer (i) is upon substantially the same terms as those available to the general public or (ii) is upon substantially the same terms that would have been extended to the consumer without the assistance of the credit services organization.(B) The money or consideration is paid by the credit grantor or is derived from the consumers payments to the credit grantor for costs, fees, finance charges, or principal.(6) Make, or counsel or advise a consumer to make, a statement that is untrue or misleading and that is known, or that by the exercise of reasonable care should be known, to be untrue or misleading, to a consumer credit reporting agency or to a person who has extended credit to a consumer, to a data furnisher, or to any person with whom a consumer is applying for an extension of credit, such as statements concerning a consumers identification, home address, creditworthiness, credit standing, or credit capacity.(7) Seek to remove, or assist or advise the consumer to remove or seek to remove, adverse information from the consumers credit record that is known to the credit services organization or that by the exercise of reasonable care should be known to the credit services organization to be accurate and not obsolete.(8) Create, or assist or advise the consumer to create, a new credit record by using a different name, address, social security number, or employee identification number.(9) Make or use untrue or misleading representations in the offer or sale of the services of a credit services organization, including either of the following:(A) Guaranteeing or otherwise stating that the credit services organization is able to delete an adverse credit history, unless the representation clearly discloses, in a manner equally as conspicuous as the guarantee, that this can be done only if the credit history is inaccurate or obsolete and is not claimed to be accurate by the creditor who submitted the information.(B) Guaranteeing or otherwise stating that the credit services organization is able to obtain an extension of credit, regardless of the consumers previous credit problems or credit history, unless the representation clearly discloses, in a manner equally as conspicuous as the guarantee, the eligibility requirements for obtaining an extension of credit.(10) Engage, directly or indirectly, in an act, practice, or course of business that operates or would operate as a fraud or deception upon a person in connection with the offer or sale of the services of a credit services organization.(11) Advertise or cause to be advertised, in any manner, the services of the credit services organization, without being registered with the Department of Financial Protection and Innovation.(12) Fail to maintain an agent for service of process in this state.(13) Transfer or assign its license.(14) Call or submit any communication to a consumer credit reporting agency, creditor, debt collector, or debt buyer without the prior written authorization of the consumer.(15) Call or submit any communication to a consumer reporting agency, creditor, debt collector, or debt buyer impersonating a consumer and failing to identify when the communication originates from the credit services organization.(16) Submit a consumers dispute to a consumer credit reporting agency, creditor, debt collector, or debt buyer more than 180 days after the account subject to the dispute has been removed.(17) Use the online electronic portal, electronic email system, or telephone system of a credit reporting agency, creditor, debt collector, or debt buyer to submit a dispute of a consumer or to request disclosure without the prior written authorization of the consumer.(18) Directly or indirectly extend credit to a consumer.(19) Refer a consumer to a credit grantor that is related to the credit services organization by a common ownership, management, or control, including a common owner, director, or officer.(20) Refer a consumer to a credit grantor for which the credit services organization provides, or arranges for a third party to provide, services related to the extension of credit such as underwriting, billing, payment processing, or debt collection.(21) Provide a credit grantor with an assurance that a portion of an extension of credit to a consumer referred by the credit services organization will be repaid, including providing a guaranty, letter of credit, or agreement to acquire a part of the credit grantors financial interest in the extension of credit.(22) Use a scheme, device, or contrivance to evade the prohibitions contained in this section.(23) Send any communication, directly or indirectly, to any person on behalf of a consumer without disclosing the senders identity, street address, telephone number, and facsimile number, and, if applicable, the name and street address of any parent organization of sender.(24) Send any written communication on behalf of a consumer to any person other than the consumer without providing a copy of the communication to the consumer within five days thereafter.(25) Fail to provide along with its first written communication to a credit reporting agency or data furnisher sufficient information to investigate a dispute of an account, including, but not limited to any pertinent information and copies of any documents that are available to it concerning the disputed item.(b) This section shall become operative on January 1, 2023.SEC. 33. Section 1789.134 is added to the Civil Code, to read:1789.134. (a) A consumer credit reporting agency, creditor, debt collector, or debt buyer that knows that a consumer is represented by a credit services organization pursuant to a power of attorney, and that also has knowledge of, or can readily ascertain the credit services organizations name and address shall communicate with the credit services organization unless either of the following circumstances apply:(1) The credit services organization fails to respond within a reasonable period of time to a communication from a consumer credit reporting agency, creditor, debt collector, or debt buyer.(2) The consumer expressly directs the consumer credit reporting agency, creditor, debt collector, or debt buyer not to communicate with the credit services organization.(b) Notwithstanding subdivision (a), a consumer credit reporting agency, creditor, or debt collector shall not be required to communicate with a credit services organization concerning an account that is subject to a dispute if any of the following apply:(1) The account subject to the dispute has been paid, settled, or otherwise resolved and has been reported as paid, settled, or otherwise resolved on the consumers credit report.(2) The account subject to the dispute has been removed from the consumers credit report.(3) The debt collector has provided to the credit services organization or to the consumer the verification information or documentation described in Section 1692g(b) of Title 15 of the United States Code regarding the account subject to dispute.(4) The debt buyer has provided to the credit services organization or to the consumer the information or documentation described in subdivisions (a) and (b) of Section 1788.52 regarding the account subject to the dispute.(5) The consumer credit reporting agency, creditor, or debt collector reasonably determines that the dispute is frivolous or irrelevant pursuant to Section 1681i(a)(3) or Section 1681s-2(a)(1)(F) of Title 15 of the United States Code. (c) This section shall become operative on January 1, 2023.SEC. 34. Section 1789.135 is added to the Civil Code, to read:1789.135. (a) To protect against fraud and identity theft, when a credit services organization sends a written communication by facsimile, electronic mail, United States mail, overnight courier, or other means that contains personal information of a consumer, the credit services organization shall redact the personal information to include only the last four digits of the social security number, taxpayer identification number, or state identification number, the last four digits of the financial account number, credit card number, or debit card number, or the month and year of the consumers date of birth, unless the inclusion of the full number or date is otherwise required by law, or is legally permissible and required to achieve the desired objective.(b) This section shall become operative on January 1, 2023.SEC. 35. Section 1789.14 of the Civil Code is amended to read:1789.14. (a) Prior to Before the execution of a contract or agreement between the buyer and a credit services organization, the credit services organization shall provide the buyer a statement in writing, containing all the information required by Section 1789.15. The credit services organization shall maintain on file or microfilm for a period of two years an exact copy of the statement, personally signed by the buyer, acknowledging receipt of a copy of the statement.(b) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 36. Section 1789.14 is added to the Civil Code, to read:1789.14. (a) Before the execution of a contract or agreement between the consumer and a credit services organization, the credit services organization shall provide the consumer a statement in writing containing all the information required by Section 1789.15. The credit services organization shall maintain on file for a period of four years following the completion or termination of the credit services organization agreement with the consumer an exact copy of the statement, personally signed by the consumer, acknowledging receipt of a copy of the statement.(b) This section shall become operative on January 1, 2023.SEC. 37. Section 1789.15 of the Civil Code is amended to read:1789.15. (a) The information statement shall include all of the following:(a)(1) A complete and detailed description of the services to be performed by the credit services organization for or on behalf of the buyer and the total amount the buyer will have to pay, or become obligated to pay, for the services.(b)(2) The buyers right to proceed against the bond under the circumstances and in the manner set forth in Section 1789.18.(c)(3) The name and address of the surety company which issued the bond.(d)(4) A complete and accurate statement of the availability of nonprofit credit counseling services.The information statement shall be printed in at least 10-point boldface type and shall include the following statement or any substantially equivalent alternative that is approved by the Department of Justice:CONSUMER CREDIT FILE RIGHTS UNDER STATE AND FEDERAL LAWYou have a right to obtain a copy of your credit file from a consumer credit reporting agency. You may be charged a reasonable fee not exceeding eight dollars ($8). There is no fee, however, if you have been turned down for credit, employment, insurance, or a rental dwelling because of information in your credit report within the preceding 60 days. The consumer credit reporting agency must provide someone to help you interpret the information in your credit file.You have a right to dispute inaccurate information by contacting the consumer credit reporting agency directly. However, neither you nor any credit repair company or credit services organization has the right to have accurate, current, and verifiable information removed from your credit report. Under the Federal Fair Credit Reporting Act, the consumer credit reporting agency must remove accurate, negative information from your report only if it is over seven years old. Bankruptcy information can be reported for 10 years.If you have notified a credit reporting agency in writing that you dispute the accuracy of information in your credit file, the consumer credit reporting agency must then reinvestigate and modify or remove inaccurate information. The consumer credit reporting agency may not charge a fee for this service. Any pertinent information and copies of all documents you have concerning an error should be given to the consumer credit reporting agency.If reinvestigation does not resolve the dispute to your satisfaction, you may send a brief statement to the consumer credit reporting agency to keep in your file, explaining why you think the record is inaccurate. The consumer credit reporting agency must include your statement about disputed information in any report it issues about you.You have a right to cancel the contract for any reason within five working days from the date you signed it. If for any reason you do cancel the contract during this time, you do not owe any money.You have a right to sue a credit services organization if it misleads you.(b) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 38. Section 1789.15 is added to the Civil Code, to read:1789.15. (a) The information statement shall include all of the following:(1) A complete and detailed description of the services to be performed by the credit services organization for or on behalf of the consumer and the total amount the consumer will have to pay, or become obligated to pay, for the services.(2) The consumers right to proceed against the bond under the circumstances and in the manner set forth in Section 1789.18.(3) The name and address of the surety company which issued the bond.(4) A complete and accurate statement of the availability of nonprofit credit counseling services.(5) The following notice: If you have a complaint about the services provided by this credit services organization or the fees charged by this credit services organization, you may submit that complaint to the Department of Financial Protection and Innovation at www.dfpi.ca.gov, or the Attorney Generals office, California Department of Justice, Attn: ____, P.O. Box 944255, Sacramento, CA 94244-2550.The information statement shall be printed in at least 10-point boldface type and shall include the following statement:CONSUMER CREDIT FILE RIGHTS UNDER STATE AND FEDERAL LAWYou have a right to obtain a free copy of your credit report from a credit reporting agency. You may obtain this free copy of your credit report one time per year by visiting www.AnnualCreditReport.com. You will be able to view your credit report, dispute alleged inaccuracies, and obtain additional information at no fee. If requested, the consumer credit reporting agency must provide someone to help you interpret the information in your credit file.You have a right to dispute inaccurate information by contacting the consumer credit reporting agency directly. However, neither you nor any credit repair company or credit services organization has the right to have accurate, current, and verifiable information removed from your credit report. Under the Federal Fair Credit Reporting Act, the consumer credit reporting agency must remove accurate, negative information from your report only if it is over seven years old. Bankruptcy information can be reported for 10 years.If you have notified a credit reporting agency in writing that you dispute the accuracy of information in your credit file, the consumer credit reporting agency must then reinvestigate and modify or remove inaccurate information. The consumer credit reporting agency may not charge a fee for this service. Any pertinent information and copies of all documents you have concerning an error should be given to the consumer credit reporting agency.If the reinvestigation does not resolve the dispute to your satisfaction, you may send a brief statement to the consumer credit reporting agency to keep in your file, explaining why you think the record is inaccurate. The consumer credit reporting agency must include your statement about disputed information in any report it issues about you.You have a right to cancel the contract with the credit services organization for any reason before midnight on the fifth working day after you signed it. If for any reason you cancel the contract during this time, you do not owe any money.You have a right to sue a credit services organization if it misleads you.(b) This section shall become operative on January 1, 2023.SEC. 39. Section 1789.16 of the Civil Code is amended to read:1789.16. (a) A credit services organization shall not provide any service to a buyer except pursuant to a written contract that complies with this section. Every contract between the buyer and a credit services organization for the purchase of the services of the credit services organization shall be in writing, shall be dated, signed by the buyer, and include all of the following:(1) A conspicuous statement in size equal to at least 10-point boldface type, in immediate proximity to the space reserved for the signature of the buyer, as follows:You, the buyer, may cancel this contract at any time prior to midnight of the fifth day after the date of the transaction. See the attached notice of cancellation form for an explanation of this right.(2) The terms and conditions of payment, including the total of all payments to be made by the buyer, whether to the credit services organization or to some other person.(3) A full and detailed description of the services to be performed by the credit services organization for the buyer, including all guarantees and all promises of full or partial refunds, and the estimated date by which the services are to be performed, or the estimated length of time for performing the services not to exceed six months or a shorter period consistent with the purposes of this title as may be prescribed by the Department of Justice.(4) The credit services organizations principal business address and the name and address of its agent, other than the Secretary of State, in the State of California, authorized to receive service of process.(b) The contract shall be accompanied by a completed form in duplicate, captioned Notice of Cancellation, which shall be attached to the contract and easily detachable, and which shall contain in type of at least 10-point the following statement written in the same language as used in the contract:Notice of CancellationYou may cancel this contract, without any penalty or obligation, within five days from the date the contract is signed.If you cancel, any payment made by you under this contract must be returned within 15 days following receipt by the seller of your cancellation notice.To cancel this contract, mail or deliver a signed and dated copy of this cancellation notice, or any other written notice, to _____ (name of seller) _____ at _____ (address of seller)(place of business) _____ not later than midnight (date).I hereby cancel this transaction.(date) _____ (purchasers signature) _____ A copy of the fully completed contract and all other documents the credit services organization requires the buyer to sign shall be given to the buyer at the time they are signed.(c) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 40. Section 1789.16 is added to the Civil Code, to read:1789.16. (a) A credit services organization shall not provide any service to a consumer except pursuant to a written contract that complies with this section. Every contract between the consumer and a credit services organization for the purchase of the services of the credit services organization shall identify the physical address, electronic mail address, and facsimile number if applicable, of the credit services organization, shall be in writing, shall be dated, shall be signed by the consumer, and shall include all of the following:(1) A conspicuous statement in size equal to at least 10-point boldface type, in immediate proximity to the space reserved for the signature of the buyer, as follows:You, the consumer, may cancel this contract at any time before midnight on the fifth working day after you sign it. See the attached notice of cancellation form for an explanation of this right.(2) The terms and conditions of payment, including the total of all payments to be made by the consumer, whether to the credit services organization or to some other person.(3) A full and detailed description of the services to be performed by the credit services organization for the consumer, including a list of the inaccurate or obsolete adverse information appearing on the consumers credit report which the credit services organization will seek to delete or modify, the basis for the deletion or modification, and, if applicable, a description of each modification sought and the anticipated payment required by the consumer to achieve each account deletion or modification, all guarantees and all promises of full or partial refunds, and the estimated date by which the services are to be performed, or the estimated length of time for performing the services, not to exceed 180 days, or a shorter period consistent with the purposes of this title as may be prescribed by the Department of Financial Protection and Innovation.(4) The credit services organizations principal business address and the name and address of its agent, other than the Secretary of State, in the State of California, authorized to receive service of process.(b) The contract shall be accompanied by a completed form in duplicate, captioned Notice of Cancellation, which shall be attached to the contract and easily detachable, and which shall contain in type of at least 10-point the following statement written in the same language as used in the contract:Notice of CancellationYou may cancel this contract, without any penalty or obligation, before midnight on the fifth working day after you sign it.If you cancel, any payment made by you under this contract must be returned within 15 days following receipt by the seller of your cancellation notice.To cancel this contract, mail or deliver a signed and dated copy of this cancellation notice, or any other written notice, to _____ (name of seller) _____ at _____ (address of seller)(place of business) _____ not later than midnight (date).I hereby cancel this transaction.(date) _____ (purchasers signature) _____ A copy of the fully completed contract and all other documents the credit services organization requires the buyer to sign shall be given to the consumer at the time they are signed.(c) This section shall become operative on January 1, 2023.SEC. 41. Section 1789.19 of the Civil Code is amended to read:1789.19. (a) Any waiver by a buyer of the provisions of this title shall be deemed contrary to public policy and shall be void and unenforceable. Any attempt by a credit services organization to have a buyer waive rights given by this title shall constitute a violation of this title.(b) In any proceeding involving this title, the burden of proving an exemption or an exception from a definition is upon the person claiming it.(c) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 42. Section 1789.19 is added to the Civil Code, to read:1789.19. (a) Any waiver by a consumer of the provisions of this title shall be deemed contrary to public policy and shall be void and unenforceable. Any attempt by a credit services organization to have a consumer waive rights given by this title shall constitute a violation of this title.(b) In any proceeding involving this title, the burden of proving an exemption or an exception from a definition is upon the person claiming it.(c) This section shall become operative on January 1, 2023.SEC. 43. Section 1789.21 of the Civil Code is amended to read:1789.21. (a) Any buyer injured by a violation of this title or by the credit services organizations breach of a contract subject to this title may bring any action for recovery of damages, or for injunctive relief, or both. Judgment shall be entered for actual damages, but in no case less than the amount paid by the buyer to the credit services organization, plus reasonable attorneys fees and costs. An award, if the trial court deems it proper, may be entered for punitive damages.(b) Any person, including, but not limited to, a consumer credit reporting agency, as defined in subdivision (d) of Section 1785.3, and any consumer of, or user of, a consumer credit report under the Consumer Credit Reporting Agencies Act (Title 1.6 (commencing with Section 1785.1)), and any furnisher of credit information under the Consumer Credit Reporting Agencies Act, may bring an action for the recovery of damages or for injunctive relief, or both, for a violation of this title. Any person bringing such an action who prevails in the action shall be entitled to reasonable attorneys fees and costs.(c) This section shall remain in effect until January 1, 2023, and as of that date is repealed.SEC. 44. Section 1789.21 is added to the Civil Code, to read:1789.21. (a) Any consumer injured by a violation of this title or by the credit services organizations breach of a contract subject to this title may bring any action for recovery of damages, or for injunctive relief, or both. Judgment shall be entered for actual damages, but in no case less than the amount paid by the consumer to the credit services organization, plus reasonable attorneys fees and costs. An award, if the trial court deems it proper, may be entered for punitive damages.(b) Any credit services organization that willfully and knowingly violates this title with respect to any consumer, in addition to any damages awarded pursuant to subdivision (a), shall also be liable to the consumer, in an individual action, for a civil penalty of not less than one hundred dollars ($100) and not greater than one thousand dollars ($1,000), to be determined by the court.(c) Any person, including, but not limited to, a consumer credit reporting agency, as defined in subdivision (d) of Section 1785.3, and any consumer of, or user of, a consumer credit report under the Consumer Credit Reporting Agencies Act (Title 1.6 (commencing with Section 1785.1)), and any furnisher of credit information under the Consumer Credit Reporting Agencies Act, may bring an action for the recovery of damages or for injunctive relief, or both, for a violation of this title. Any person bringing such an action who prevails in the action shall be entitled to reasonable attorneys fees and costs.(d) This section shall become operative on January 1, 2023.SEC. 45. Section 1789.25 of the Civil Code is amended to read:1789.25. (a) Every credit services organization shall file a registration application with, and receive a certificate of registration from, the Department of Justice before conducting business in this state. The Department of Justice shall not issue a certificate of registration until the bond required by Section 1789.18 has been filed with the office of the Secretary of State and the department establishes that the organization seeking a certificate satisfies the requirements of subdivision (f). The application shall be accompanied by a registration fee of one hundred dollars ($100). The registration application shall contain all of the following information:(1) The name and address where business is actually conducted of the credit services organization.(2) The names, addresses, and drivers license numbers of any and all persons who directly or indirectly own or control 10 percent or more of the outstanding shares of stock in the credit services organization.(3) Either of the following:(A) A full and complete disclosure of any litigation commenced against the credit services organization or any resolved or unresolved complaint that relates to the operation of the credit services organization and that is filed with the Attorney General or any other governmental authority of this state, any other state, or the federal government. With respect to each resolved complaint identified by the disclosure, the disclosure shall include a brief description of the resolution.(B) An acknowledged declaration under penalty of perjury stating that no litigation has been commenced and no unresolved complaint relating to the operation of the organization has been filed with the Attorney General or any other governmental authority of this state, any other state, or the federal government.(4) Other information that the Department of Justice requires, either at the time of application or thereafter.(b) The Department of Justice may conduct an investigation to verify the accuracy of the registration application. If the application involves investigation outside this state, the applicant credit services organization may be required by the Department of Justice to advance sufficient funds to pay the actual expenses of the investigation. Any nonresident applying for registration under this section shall designate and maintain a resident of this state as the applicants agent for the purpose of receipt of service of process.(c) Each credit services organization shall notify the Department of Justice in writing within 30 days after the date of a change in the information required by subdivision (a), except that 30 days advance notice and approval by the Department of Justice shall be required before changing the corporate name or address, or persons owning more than 10 percent of the shares of stock in the organization. Each credit services organization registering under this section may use no more than one fictitious or trade name and shall maintain a copy of the registration application in its files. The organization shall allow a buyer to inspect the registration application upon request.(d) A certificate of registration issued pursuant to this section shall expire annually on the last day of December but may be renewed by filing a renewal application accompanied by a fee not to exceed the Department of Justices costs of administration.(e) The credit services organization shall attach to the registration statement a copy of the contract or contracts which the credit services organization intends to execute with its customers and a copy of the required bond.(f) The Department of Justice shall not issue a certificate of registration under this title to any person who has engaged in, or proposes to engage in, any activity that is in violation of Section 1789.13, any law prohibiting the use of untrue or misleading statements, or any law related to the extension of credit to persons for personal, family, or household purposes.(g) This section shall become inoperative on January 1, 2023, and as of that date is repealed.SEC. 46. Section 1789.25 is added to the Civil Code, to read:1789.25. (a) Every credit services organization shall file an application for licensure with, and receive a license from, the Department of Financial Protection and Innovation before conducting business in this state. The Department of Financial Protection and Innovation shall not issue a license until the bond required by Section 1789.18 has been filed with the Office of the Secretary of State and the department establishes that the organization seeking a license satisfies the requirements of subdivision (f). The application shall be accompanied by a license fee of one hundred dollars ($100). The Department of Financial Protection and Innovation may, periodically, increase the fee, but the amount of the fee shall not exceed that which is reasonable and necessary to satisfy its costs in complying with its duties under this title to regulate credit services organizations. The application shall contain all of the following information:(1) The name and address where business is actually conducted of the credit services organization.(2) The names, addresses, and drivers license numbers of any and all persons who directly or indirectly own or control 10 percent or more of the outstanding shares of stock in the credit services organization.(3) Either of the following:(A) A full and complete disclosure of any litigation commenced against the credit services organization or any resolved or unresolved complaint that relates to the operation of the credit services organization and that is filed with the Department of Financial Protection and Innovation, the Attorney General, or any other governmental authority of this state, any other state, or the federal government. With respect to each resolved complaint identified by the disclosure, the disclosure shall include a brief description of the resolution.(B) An acknowledged declaration under penalty of perjury stating that no litigation has been commenced and no unresolved complaint relating to the operation of the organization has been filed with the Department of Financial Protection and Innovation, the Attorney General, or any other governmental authority of this state, any other state, or the federal government.(4) Other information that the Department of Financial Protection and Innovation requires, either at the time of application or thereafter.(b) The Department of Financial Protection and Innovation may conduct an investigation to verify the accuracy of the licensure application. If the application involves investigation outside this state, the applicant credit services organization may be required by the Department of Financial Protection and Innovation to advance sufficient funds to pay the actual expenses of the investigation. Any nonresident applying for licensure under this section shall designate and maintain a resident of this state as the applicants agent for the purpose of receipt of service of process.(c) Each credit services organization shall notify the Department of Financial Protection and Innovation in writing within 30 days after the date of a change in the information required by subdivision (a), except that 30 days advance notice and approval by the Department of Financial Protection and Innovation shall be required before changing the corporate name or address, or persons owning more than 10 percent of the shares of stock in the organization. Each credit services organization applying for licensure under this section may use no more than one fictitious or trade name and shall maintain a copy of the license application in its files. The organization shall allow a buyer to inspect the license application upon request.(d) A license issued pursuant to this section shall expire one year after it was issued, but may be renewed by filing a renewal application accompanied by a fee in an amount to be determined annually by the Department of Financial Protection and Innovation as is reasonable and necessary to satisfy its costs in complying with its duties under this title to regulate credit services organizations. The Department of Financial Protection and Innovation may, periodically, increase the fee, but the amount of the fee shall not exceed that which is reasonable and necessary to satisfy its costs in complying with its duties under this title to regulate credit services organizations.(e) The credit services organization shall attach to the license statement a copy of the contract or contracts which the credit services organization intends to execute with its customers and a copy of the required bond.(f) The Department of Financial Protection and Innovation shall not issue a license under this title to any person who has engaged in, or proposes to engage in, any activity that is in violation of Section 1789.13, any law prohibiting the use of untrue or misleading statements, or any law related to the extension of credit to persons for personal, family, or household purposes.(g) The Department of Financial Protection and Innovation shall maintain on a publicly available internet website a list of the credit services organizations that are licensed in this state.(h) This section shall become operative on January 1, 2023.SEC. 47. The Legislature finds and declares that Section 30 of this act, which adds Section 1789.12.35 of the Civil Code, imposes a limitation on the publics right of access to the meetings of public bodies or the writings of public officials and agencies within the meaning of Section 3 of Article I of the California Constitution. Pursuant to that constitutional provision, the Legislature makes the following findings to demonstrate the interest protected by this limitation and the need for protecting that interest:Protecting from public disclosure limited confidential information provided by licensees to the Commissioner of the Department of Financial Protection and Innovation properly balances protecting legitimate private economic interests and public interests in effective regulation. SEC. 48. No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIIIB of the California Constitution. |
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| 213 | 217 | | |
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| 214 | 218 | | (5) Any attorney licensed to practice law in this state, where the attorney renders services within the course and scope of the practice of law, unless the attorney is an employee of, or otherwise directly affiliated with, a credit services organization. |
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| 215 | 219 | | |
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| 216 | 220 | | (6) Any broker-dealer registered with the Securities and Exchange Commission or the Commodity Futures Trading Commission where the broker-dealer is acting within the course and scope of the regulation. |
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| 217 | 221 | | |
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| 218 | 222 | | (7) Any nonprofit organization described in Section 501(c)(3) of the Internal Revenue Code that, according to a final ruling or determination by the Internal Revenue Service, is both of the following: |
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| 219 | 223 | | |
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| 220 | 224 | | (A) Exempt from taxation under Section 501(a) of the Internal Revenue Code. |
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| 221 | 225 | | |
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| 222 | 226 | | (B) Not a private foundation as defined in Section 509 of the Internal Revenue Code. |
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| 223 | 227 | | |
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| 224 | 228 | | An advance ruling or determination of tax-exempt or foundation status by the Internal Revenue Service does not meet the requirements of this paragraph. |
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| 225 | 229 | | |
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| 226 | 230 | | (c) Buyer means any natural person who is solicited to purchase or who purchases the services of a credit services organization. |
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| 227 | 231 | | |
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| 228 | 232 | | (d) Extension of credit means the right to defer payment of debt or to incur debt and defer its payment, offered or granted primarily for personal, family, or household purposes. |
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| 229 | 233 | | |
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| 230 | 234 | | (e) Consumer credit reporting agency means a consumer credit reporting agency subject to the Consumer Credit Reporting Agencies Act, Title 1.6 (commencing with Section 1785.1). |
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| 231 | 235 | | |
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| 232 | 236 | | (f) Person includes an individual, corporation, partnership, joint venture, or any business entity. |
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| 233 | 237 | | |
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| 234 | 238 | | (g) This section shall become inoperative on January 1, 2023, and as of that date is repealed. |
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| 235 | 239 | | |
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| 236 | 240 | | SEC. 7. Section 1789.12 is added to the Civil Code, to read:1789.12. (a) As used in this title:(1) Applicant means a person who has applied for a license pursuant to this title.(2) Commissioner means the Commissioner of the Department of Financial Protection and Innovation.(3) Communication means the conveyance of any information regarding a debt, credit record, credit history, or credit rating, directly or indirectly, to any person by any means or through any medium.(4) Consumer means any natural person who resides in California and is solicited to purchase or who purchases the services of a credit services organization.(5) Consumer credit reporting agency has the same meaning as in Section 1785.3.(6) (A) Credit services organization means a person who, with respect to the extension of credit by others, sells, provides, or performs, or represents that the person can or will sell, provide, or perform, any of the following services, in return for the payment of money or other valuable consideration:(i) Improving a consumers credit record, history, or rating.(ii) Obtaining a loan or other extension of credit for a consumer.(iii) Providing advice or assistance to a consumer with regard to either clause (i) or (ii).(B) Credit services organization does not include any of the following:(i) Any person holding a license to make loans or extensions of credit pursuant to the laws of this state or the United States who is subject to regulation and supervision with respect to the making of those loans or extensions of credit by an official or agency of this state or the United States and whose business is the making of those loans or extensions of credit.(ii) Any bank, as defined in Section 103 of the Financial Code, or any savings institution, as specified in subdivision (a) or (b) of Section 5102 of the Financial Code, whose deposits or accounts are eligible for insurance by the Federal Deposit Insurance Corporation.(iii) Any person licensed as a prorater by the Department of Financial Protection and Innovation when the person is acting within the course and scope of that license.(iv) Any person licensed as a real estate broker performing an act for which a real estate license is required under the Real Estate Law (Part 1 (commencing with Section 10000) of Division 4 of the Business and Professions Code) and who is acting within the course and scope of that license.(v) Any attorney licensed to practice law in this state, where the attorney renders services within the course and scope of the practice of law, unless the attorney is an employee of, or otherwise directly affiliated with, a credit services organization.(vi) Any broker-dealer registered with the Securities and Exchange Commission or the Commodity Futures Trading Commission where the broker-dealer is acting within the course and scope of the regulation.(vii) Any nonprofit organization described in Section 501(c)(3) of the Internal Revenue Code that, according to a final ruling or determination by the Internal Revenue Service, is both of the following:(I) Exempt from taxation under Section 501(a) of the Internal Revenue Code.(II) Not a private foundation as defined in Section 509 of the Internal Revenue Code.An advance ruling or determination of tax-exempt or foundation status by the Internal Revenue Service does not meet the requirements of this paragraph.(7) Data Furnisher has the same meaning as the term furnisher is defined in Section 660.2 of Title 16 of the Code of Federal Regulations.(8) Department means the Department of Financial Protection and Innovation.(9) Extension of credit means the right to defer payment of debt or to incur debt and defer its payment, offered or granted primarily for personal, family, or household purposes.(10) Fund means the Credit Services Organization Licensing Fund established pursuant to Section 1789.12.13.(11) Licensee means a person licensed pursuant to this chapter.(12) Nationwide Multistate Licensing System and Registry means a system of record, created by the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators, for nondepository, financial services licensing or registration in participating state agencies, the District of Colombia, Puerto Rico, the United States Virgin Islands, and Guam.(13) Person includes a natural person, corporation, partnership, limited liability company, joint venture, or any business entity.(b) This section shall become operative on January 1, 2023. |
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| 237 | 241 | | |
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| 238 | 242 | | SEC. 7. Section 1789.12 is added to the Civil Code, to read: |
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| 239 | 243 | | |
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| 240 | 244 | | ### SEC. 7. |
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| 241 | 245 | | |
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| 242 | 246 | | 1789.12. (a) As used in this title:(1) Applicant means a person who has applied for a license pursuant to this title.(2) Commissioner means the Commissioner of the Department of Financial Protection and Innovation.(3) Communication means the conveyance of any information regarding a debt, credit record, credit history, or credit rating, directly or indirectly, to any person by any means or through any medium.(4) Consumer means any natural person who resides in California and is solicited to purchase or who purchases the services of a credit services organization.(5) Consumer credit reporting agency has the same meaning as in Section 1785.3.(6) (A) Credit services organization means a person who, with respect to the extension of credit by others, sells, provides, or performs, or represents that the person can or will sell, provide, or perform, any of the following services, in return for the payment of money or other valuable consideration:(i) Improving a consumers credit record, history, or rating.(ii) Obtaining a loan or other extension of credit for a consumer.(iii) Providing advice or assistance to a consumer with regard to either clause (i) or (ii).(B) Credit services organization does not include any of the following:(i) Any person holding a license to make loans or extensions of credit pursuant to the laws of this state or the United States who is subject to regulation and supervision with respect to the making of those loans or extensions of credit by an official or agency of this state or the United States and whose business is the making of those loans or extensions of credit.(ii) Any bank, as defined in Section 103 of the Financial Code, or any savings institution, as specified in subdivision (a) or (b) of Section 5102 of the Financial Code, whose deposits or accounts are eligible for insurance by the Federal Deposit Insurance Corporation.(iii) Any person licensed as a prorater by the Department of Financial Protection and Innovation when the person is acting within the course and scope of that license.(iv) Any person licensed as a real estate broker performing an act for which a real estate license is required under the Real Estate Law (Part 1 (commencing with Section 10000) of Division 4 of the Business and Professions Code) and who is acting within the course and scope of that license.(v) Any attorney licensed to practice law in this state, where the attorney renders services within the course and scope of the practice of law, unless the attorney is an employee of, or otherwise directly affiliated with, a credit services organization.(vi) Any broker-dealer registered with the Securities and Exchange Commission or the Commodity Futures Trading Commission where the broker-dealer is acting within the course and scope of the regulation.(vii) Any nonprofit organization described in Section 501(c)(3) of the Internal Revenue Code that, according to a final ruling or determination by the Internal Revenue Service, is both of the following:(I) Exempt from taxation under Section 501(a) of the Internal Revenue Code.(II) Not a private foundation as defined in Section 509 of the Internal Revenue Code.An advance ruling or determination of tax-exempt or foundation status by the Internal Revenue Service does not meet the requirements of this paragraph.(7) Data Furnisher has the same meaning as the term furnisher is defined in Section 660.2 of Title 16 of the Code of Federal Regulations.(8) Department means the Department of Financial Protection and Innovation.(9) Extension of credit means the right to defer payment of debt or to incur debt and defer its payment, offered or granted primarily for personal, family, or household purposes.(10) Fund means the Credit Services Organization Licensing Fund established pursuant to Section 1789.12.13.(11) Licensee means a person licensed pursuant to this chapter.(12) Nationwide Multistate Licensing System and Registry means a system of record, created by the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators, for nondepository, financial services licensing or registration in participating state agencies, the District of Colombia, Puerto Rico, the United States Virgin Islands, and Guam.(13) Person includes a natural person, corporation, partnership, limited liability company, joint venture, or any business entity.(b) This section shall become operative on January 1, 2023. |
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| 243 | 247 | | |
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| 244 | 248 | | 1789.12. (a) As used in this title:(1) Applicant means a person who has applied for a license pursuant to this title.(2) Commissioner means the Commissioner of the Department of Financial Protection and Innovation.(3) Communication means the conveyance of any information regarding a debt, credit record, credit history, or credit rating, directly or indirectly, to any person by any means or through any medium.(4) Consumer means any natural person who resides in California and is solicited to purchase or who purchases the services of a credit services organization.(5) Consumer credit reporting agency has the same meaning as in Section 1785.3.(6) (A) Credit services organization means a person who, with respect to the extension of credit by others, sells, provides, or performs, or represents that the person can or will sell, provide, or perform, any of the following services, in return for the payment of money or other valuable consideration:(i) Improving a consumers credit record, history, or rating.(ii) Obtaining a loan or other extension of credit for a consumer.(iii) Providing advice or assistance to a consumer with regard to either clause (i) or (ii).(B) Credit services organization does not include any of the following:(i) Any person holding a license to make loans or extensions of credit pursuant to the laws of this state or the United States who is subject to regulation and supervision with respect to the making of those loans or extensions of credit by an official or agency of this state or the United States and whose business is the making of those loans or extensions of credit.(ii) Any bank, as defined in Section 103 of the Financial Code, or any savings institution, as specified in subdivision (a) or (b) of Section 5102 of the Financial Code, whose deposits or accounts are eligible for insurance by the Federal Deposit Insurance Corporation.(iii) Any person licensed as a prorater by the Department of Financial Protection and Innovation when the person is acting within the course and scope of that license.(iv) Any person licensed as a real estate broker performing an act for which a real estate license is required under the Real Estate Law (Part 1 (commencing with Section 10000) of Division 4 of the Business and Professions Code) and who is acting within the course and scope of that license.(v) Any attorney licensed to practice law in this state, where the attorney renders services within the course and scope of the practice of law, unless the attorney is an employee of, or otherwise directly affiliated with, a credit services organization.(vi) Any broker-dealer registered with the Securities and Exchange Commission or the Commodity Futures Trading Commission where the broker-dealer is acting within the course and scope of the regulation.(vii) Any nonprofit organization described in Section 501(c)(3) of the Internal Revenue Code that, according to a final ruling or determination by the Internal Revenue Service, is both of the following:(I) Exempt from taxation under Section 501(a) of the Internal Revenue Code.(II) Not a private foundation as defined in Section 509 of the Internal Revenue Code.An advance ruling or determination of tax-exempt or foundation status by the Internal Revenue Service does not meet the requirements of this paragraph.(7) Data Furnisher has the same meaning as the term furnisher is defined in Section 660.2 of Title 16 of the Code of Federal Regulations.(8) Department means the Department of Financial Protection and Innovation.(9) Extension of credit means the right to defer payment of debt or to incur debt and defer its payment, offered or granted primarily for personal, family, or household purposes.(10) Fund means the Credit Services Organization Licensing Fund established pursuant to Section 1789.12.13.(11) Licensee means a person licensed pursuant to this chapter.(12) Nationwide Multistate Licensing System and Registry means a system of record, created by the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators, for nondepository, financial services licensing or registration in participating state agencies, the District of Colombia, Puerto Rico, the United States Virgin Islands, and Guam.(13) Person includes a natural person, corporation, partnership, limited liability company, joint venture, or any business entity.(b) This section shall become operative on January 1, 2023. |
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| 245 | 249 | | |
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| 246 | 250 | | 1789.12. (a) As used in this title:(1) Applicant means a person who has applied for a license pursuant to this title.(2) Commissioner means the Commissioner of the Department of Financial Protection and Innovation.(3) Communication means the conveyance of any information regarding a debt, credit record, credit history, or credit rating, directly or indirectly, to any person by any means or through any medium.(4) Consumer means any natural person who resides in California and is solicited to purchase or who purchases the services of a credit services organization.(5) Consumer credit reporting agency has the same meaning as in Section 1785.3.(6) (A) Credit services organization means a person who, with respect to the extension of credit by others, sells, provides, or performs, or represents that the person can or will sell, provide, or perform, any of the following services, in return for the payment of money or other valuable consideration:(i) Improving a consumers credit record, history, or rating.(ii) Obtaining a loan or other extension of credit for a consumer.(iii) Providing advice or assistance to a consumer with regard to either clause (i) or (ii).(B) Credit services organization does not include any of the following:(i) Any person holding a license to make loans or extensions of credit pursuant to the laws of this state or the United States who is subject to regulation and supervision with respect to the making of those loans or extensions of credit by an official or agency of this state or the United States and whose business is the making of those loans or extensions of credit.(ii) Any bank, as defined in Section 103 of the Financial Code, or any savings institution, as specified in subdivision (a) or (b) of Section 5102 of the Financial Code, whose deposits or accounts are eligible for insurance by the Federal Deposit Insurance Corporation.(iii) Any person licensed as a prorater by the Department of Financial Protection and Innovation when the person is acting within the course and scope of that license.(iv) Any person licensed as a real estate broker performing an act for which a real estate license is required under the Real Estate Law (Part 1 (commencing with Section 10000) of Division 4 of the Business and Professions Code) and who is acting within the course and scope of that license.(v) Any attorney licensed to practice law in this state, where the attorney renders services within the course and scope of the practice of law, unless the attorney is an employee of, or otherwise directly affiliated with, a credit services organization.(vi) Any broker-dealer registered with the Securities and Exchange Commission or the Commodity Futures Trading Commission where the broker-dealer is acting within the course and scope of the regulation.(vii) Any nonprofit organization described in Section 501(c)(3) of the Internal Revenue Code that, according to a final ruling or determination by the Internal Revenue Service, is both of the following:(I) Exempt from taxation under Section 501(a) of the Internal Revenue Code.(II) Not a private foundation as defined in Section 509 of the Internal Revenue Code.An advance ruling or determination of tax-exempt or foundation status by the Internal Revenue Service does not meet the requirements of this paragraph.(7) Data Furnisher has the same meaning as the term furnisher is defined in Section 660.2 of Title 16 of the Code of Federal Regulations.(8) Department means the Department of Financial Protection and Innovation.(9) Extension of credit means the right to defer payment of debt or to incur debt and defer its payment, offered or granted primarily for personal, family, or household purposes.(10) Fund means the Credit Services Organization Licensing Fund established pursuant to Section 1789.12.13.(11) Licensee means a person licensed pursuant to this chapter.(12) Nationwide Multistate Licensing System and Registry means a system of record, created by the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators, for nondepository, financial services licensing or registration in participating state agencies, the District of Colombia, Puerto Rico, the United States Virgin Islands, and Guam.(13) Person includes a natural person, corporation, partnership, limited liability company, joint venture, or any business entity.(b) This section shall become operative on January 1, 2023. |
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| 247 | 251 | | |
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| 248 | 252 | | |
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| 249 | 253 | | |
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| 250 | 254 | | 1789.12. (a) As used in this title: |
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| 251 | 255 | | |
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| 252 | 256 | | (1) Applicant means a person who has applied for a license pursuant to this title. |
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| 253 | 257 | | |
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| 254 | 258 | | (2) Commissioner means the Commissioner of the Department of Financial Protection and Innovation. |
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| 255 | 259 | | |
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| 256 | 260 | | (3) Communication means the conveyance of any information regarding a debt, credit record, credit history, or credit rating, directly or indirectly, to any person by any means or through any medium. |
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| 257 | 261 | | |
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| 258 | 262 | | (4) Consumer means any natural person who resides in California and is solicited to purchase or who purchases the services of a credit services organization. |
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| 259 | 263 | | |
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| 260 | 264 | | (5) Consumer credit reporting agency has the same meaning as in Section 1785.3. |
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| 261 | 265 | | |
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| 262 | 266 | | (6) (A) Credit services organization means a person who, with respect to the extension of credit by others, sells, provides, or performs, or represents that the person can or will sell, provide, or perform, any of the following services, in return for the payment of money or other valuable consideration: |
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| 263 | 267 | | |
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| 264 | 268 | | (i) Improving a consumers credit record, history, or rating. |
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| 265 | 269 | | |
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| 266 | 270 | | (ii) Obtaining a loan or other extension of credit for a consumer. |
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| 267 | 271 | | |
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| 268 | 272 | | (iii) Providing advice or assistance to a consumer with regard to either clause (i) or (ii). |
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| 269 | 273 | | |
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| 270 | 274 | | (B) Credit services organization does not include any of the following: |
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| 271 | 275 | | |
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| 272 | 276 | | (i) Any person holding a license to make loans or extensions of credit pursuant to the laws of this state or the United States who is subject to regulation and supervision with respect to the making of those loans or extensions of credit by an official or agency of this state or the United States and whose business is the making of those loans or extensions of credit. |
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| 273 | 277 | | |
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| 274 | 278 | | (ii) Any bank, as defined in Section 103 of the Financial Code, or any savings institution, as specified in subdivision (a) or (b) of Section 5102 of the Financial Code, whose deposits or accounts are eligible for insurance by the Federal Deposit Insurance Corporation. |
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| 275 | 279 | | |
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| 276 | 280 | | (iii) Any person licensed as a prorater by the Department of Financial Protection and Innovation when the person is acting within the course and scope of that license. |
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| 277 | 281 | | |
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| 278 | 282 | | (iv) Any person licensed as a real estate broker performing an act for which a real estate license is required under the Real Estate Law (Part 1 (commencing with Section 10000) of Division 4 of the Business and Professions Code) and who is acting within the course and scope of that license. |
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| 279 | 283 | | |
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| 280 | 284 | | (v) Any attorney licensed to practice law in this state, where the attorney renders services within the course and scope of the practice of law, unless the attorney is an employee of, or otherwise directly affiliated with, a credit services organization. |
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| 281 | 285 | | |
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| 282 | 286 | | (vi) Any broker-dealer registered with the Securities and Exchange Commission or the Commodity Futures Trading Commission where the broker-dealer is acting within the course and scope of the regulation. |
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| 283 | 287 | | |
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| 284 | 288 | | (vii) Any nonprofit organization described in Section 501(c)(3) of the Internal Revenue Code that, according to a final ruling or determination by the Internal Revenue Service, is both of the following: |
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| 285 | 289 | | |
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| 286 | 290 | | (I) Exempt from taxation under Section 501(a) of the Internal Revenue Code. |
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| 287 | 291 | | |
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| 288 | 292 | | (II) Not a private foundation as defined in Section 509 of the Internal Revenue Code. |
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| 289 | 293 | | |
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| 290 | 294 | | An advance ruling or determination of tax-exempt or foundation status by the Internal Revenue Service does not meet the requirements of this paragraph. |
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| 291 | 295 | | |
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| 292 | 296 | | (7) Data Furnisher has the same meaning as the term furnisher is defined in Section 660.2 of Title 16 of the Code of Federal Regulations. |
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| 293 | 297 | | |
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| 294 | 298 | | (8) Department means the Department of Financial Protection and Innovation. |
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| 295 | 299 | | |
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| 296 | 300 | | (9) Extension of credit means the right to defer payment of debt or to incur debt and defer its payment, offered or granted primarily for personal, family, or household purposes. |
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| 297 | 301 | | |
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| 298 | 302 | | (10) Fund means the Credit Services Organization Licensing Fund established pursuant to Section 1789.12.13. |
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| 299 | 303 | | |
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| 300 | 304 | | (11) Licensee means a person licensed pursuant to this chapter. |
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| 301 | 305 | | |
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| 302 | 306 | | (12) Nationwide Multistate Licensing System and Registry means a system of record, created by the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators, for nondepository, financial services licensing or registration in participating state agencies, the District of Colombia, Puerto Rico, the United States Virgin Islands, and Guam. |
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| 303 | 307 | | |
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| 304 | 308 | | (13) Person includes a natural person, corporation, partnership, limited liability company, joint venture, or any business entity. |
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| 305 | 309 | | |
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| 306 | 310 | | (b) This section shall become operative on January 1, 2023. |
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| 307 | 311 | | |
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| 308 | 312 | | SEC. 8. Section 1789.12.1 is added to the Civil Code, to read:1789.12.1. (a) The commissioner shall administer this title and may adopt rules and regulations, and issue orders, consistent with that authority.(b) Without limitation, the functions, powers, and duties of the commissioner include all of the following:(1) To issue or to refuse to issue a license as provided in this title.(2) To allow affiliated companies to be under a single license. The commissioner shall adopt regulations specifying what constitutes an affiliated company for these purposes.(3) To keep records of licenses issued under this title.(4) To receive, consider, investigate, and act upon a complaint made in connection with a licensee.(5) To prescribe the form of and to receive applications for licenses and reports, books, and records required to be made or retained by a licensee.(6) To subpoena documents and witnesses, and to compel their attendance and production, to administer oaths, and to require the production of books, papers, or other materials relevant to any inquiry authorized by this title.(7) To require information with regard to an applicant that the commissioner may deem necessary, with regard for the paramount public interest in ascertaining the experience, background, honesty, truthfulness, integrity, and competency of an applicant for providing credit services, and if an applicant is an entity other than an individual, in ascertaining the honesty, truthfulness, integrity, and competency of officers, directors, or managing members of the corporation, association, or other entity, or the general patterns of a partnership.(8) To enforce by order any provision of this title.(9) To levy fees, fines, and charges in an amount sufficient to cover the cost of the services performed in administering this title. The fees collected pursuant to this title shall not exceed the costs of administering this title.(c) This section shall become operative on January 1, 2023. |
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| 309 | 313 | | |
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| 310 | 314 | | SEC. 8. Section 1789.12.1 is added to the Civil Code, to read: |
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| 311 | 315 | | |
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| 312 | 316 | | ### SEC. 8. |
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| 313 | 317 | | |
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| 314 | 318 | | 1789.12.1. (a) The commissioner shall administer this title and may adopt rules and regulations, and issue orders, consistent with that authority.(b) Without limitation, the functions, powers, and duties of the commissioner include all of the following:(1) To issue or to refuse to issue a license as provided in this title.(2) To allow affiliated companies to be under a single license. The commissioner shall adopt regulations specifying what constitutes an affiliated company for these purposes.(3) To keep records of licenses issued under this title.(4) To receive, consider, investigate, and act upon a complaint made in connection with a licensee.(5) To prescribe the form of and to receive applications for licenses and reports, books, and records required to be made or retained by a licensee.(6) To subpoena documents and witnesses, and to compel their attendance and production, to administer oaths, and to require the production of books, papers, or other materials relevant to any inquiry authorized by this title.(7) To require information with regard to an applicant that the commissioner may deem necessary, with regard for the paramount public interest in ascertaining the experience, background, honesty, truthfulness, integrity, and competency of an applicant for providing credit services, and if an applicant is an entity other than an individual, in ascertaining the honesty, truthfulness, integrity, and competency of officers, directors, or managing members of the corporation, association, or other entity, or the general patterns of a partnership.(8) To enforce by order any provision of this title.(9) To levy fees, fines, and charges in an amount sufficient to cover the cost of the services performed in administering this title. The fees collected pursuant to this title shall not exceed the costs of administering this title.(c) This section shall become operative on January 1, 2023. |
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| 315 | 319 | | |
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| 316 | 320 | | 1789.12.1. (a) The commissioner shall administer this title and may adopt rules and regulations, and issue orders, consistent with that authority.(b) Without limitation, the functions, powers, and duties of the commissioner include all of the following:(1) To issue or to refuse to issue a license as provided in this title.(2) To allow affiliated companies to be under a single license. The commissioner shall adopt regulations specifying what constitutes an affiliated company for these purposes.(3) To keep records of licenses issued under this title.(4) To receive, consider, investigate, and act upon a complaint made in connection with a licensee.(5) To prescribe the form of and to receive applications for licenses and reports, books, and records required to be made or retained by a licensee.(6) To subpoena documents and witnesses, and to compel their attendance and production, to administer oaths, and to require the production of books, papers, or other materials relevant to any inquiry authorized by this title.(7) To require information with regard to an applicant that the commissioner may deem necessary, with regard for the paramount public interest in ascertaining the experience, background, honesty, truthfulness, integrity, and competency of an applicant for providing credit services, and if an applicant is an entity other than an individual, in ascertaining the honesty, truthfulness, integrity, and competency of officers, directors, or managing members of the corporation, association, or other entity, or the general patterns of a partnership.(8) To enforce by order any provision of this title.(9) To levy fees, fines, and charges in an amount sufficient to cover the cost of the services performed in administering this title. The fees collected pursuant to this title shall not exceed the costs of administering this title.(c) This section shall become operative on January 1, 2023. |
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| 317 | 321 | | |
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| 318 | 322 | | 1789.12.1. (a) The commissioner shall administer this title and may adopt rules and regulations, and issue orders, consistent with that authority.(b) Without limitation, the functions, powers, and duties of the commissioner include all of the following:(1) To issue or to refuse to issue a license as provided in this title.(2) To allow affiliated companies to be under a single license. The commissioner shall adopt regulations specifying what constitutes an affiliated company for these purposes.(3) To keep records of licenses issued under this title.(4) To receive, consider, investigate, and act upon a complaint made in connection with a licensee.(5) To prescribe the form of and to receive applications for licenses and reports, books, and records required to be made or retained by a licensee.(6) To subpoena documents and witnesses, and to compel their attendance and production, to administer oaths, and to require the production of books, papers, or other materials relevant to any inquiry authorized by this title.(7) To require information with regard to an applicant that the commissioner may deem necessary, with regard for the paramount public interest in ascertaining the experience, background, honesty, truthfulness, integrity, and competency of an applicant for providing credit services, and if an applicant is an entity other than an individual, in ascertaining the honesty, truthfulness, integrity, and competency of officers, directors, or managing members of the corporation, association, or other entity, or the general patterns of a partnership.(8) To enforce by order any provision of this title.(9) To levy fees, fines, and charges in an amount sufficient to cover the cost of the services performed in administering this title. The fees collected pursuant to this title shall not exceed the costs of administering this title.(c) This section shall become operative on January 1, 2023. |
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| 319 | 323 | | |
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| 320 | 324 | | |
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| 321 | 325 | | |
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| 322 | 326 | | 1789.12.1. (a) The commissioner shall administer this title and may adopt rules and regulations, and issue orders, consistent with that authority. |
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| 323 | 327 | | |
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| 324 | 328 | | (b) Without limitation, the functions, powers, and duties of the commissioner include all of the following: |
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| 325 | 329 | | |
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| 326 | 330 | | (1) To issue or to refuse to issue a license as provided in this title. |
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| 327 | 331 | | |
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| 328 | 332 | | (2) To allow affiliated companies to be under a single license. The commissioner shall adopt regulations specifying what constitutes an affiliated company for these purposes. |
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| 329 | 333 | | |
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| 330 | 334 | | (3) To keep records of licenses issued under this title. |
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| 331 | 335 | | |
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| 332 | 336 | | (4) To receive, consider, investigate, and act upon a complaint made in connection with a licensee. |
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| 333 | 337 | | |
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| 334 | 338 | | (5) To prescribe the form of and to receive applications for licenses and reports, books, and records required to be made or retained by a licensee. |
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| 335 | 339 | | |
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| 336 | 340 | | (6) To subpoena documents and witnesses, and to compel their attendance and production, to administer oaths, and to require the production of books, papers, or other materials relevant to any inquiry authorized by this title. |
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| 337 | 341 | | |
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| 338 | 342 | | (7) To require information with regard to an applicant that the commissioner may deem necessary, with regard for the paramount public interest in ascertaining the experience, background, honesty, truthfulness, integrity, and competency of an applicant for providing credit services, and if an applicant is an entity other than an individual, in ascertaining the honesty, truthfulness, integrity, and competency of officers, directors, or managing members of the corporation, association, or other entity, or the general patterns of a partnership. |
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| 339 | 343 | | |
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| 340 | 344 | | (8) To enforce by order any provision of this title. |
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| 341 | 345 | | |
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| 342 | 346 | | (9) To levy fees, fines, and charges in an amount sufficient to cover the cost of the services performed in administering this title. The fees collected pursuant to this title shall not exceed the costs of administering this title. |
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| 343 | 347 | | |
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| 344 | 348 | | (c) This section shall become operative on January 1, 2023. |
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| 345 | 349 | | |
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| 346 | 350 | | SEC. 9. Section 1789.12.3 is added to the Civil Code, to read:1789.12.3. (a) The proceedings for a revocation of a license shall be conducted in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code.(b) The commissioner may suspend or revoke a license if, after notice and an opportunity for hearing, the commissioner finds any of the following:(1) The licensee violated this title or a regulation adopted or an order issued under this title.(2) The licensee does not cooperate with an examination or investigation by the commissioner.(3) The licensee is insolvent, suspends payment of its obligations, or makes a general assignment for the benefit of its creditors.(4) A receiver, liquidator, or conservator has been appointed for a licensee.(5) Any fact or condition exists that, if it had existed at the time that the licensee applied for the license, would have been grounds for denying the application.(c) This section shall become operative on January 1, 2023. |
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| 347 | 351 | | |
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| 348 | 352 | | SEC. 9. Section 1789.12.3 is added to the Civil Code, to read: |
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| 349 | 353 | | |
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| 350 | 354 | | ### SEC. 9. |
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| 351 | 355 | | |
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| 352 | 356 | | 1789.12.3. (a) The proceedings for a revocation of a license shall be conducted in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code.(b) The commissioner may suspend or revoke a license if, after notice and an opportunity for hearing, the commissioner finds any of the following:(1) The licensee violated this title or a regulation adopted or an order issued under this title.(2) The licensee does not cooperate with an examination or investigation by the commissioner.(3) The licensee is insolvent, suspends payment of its obligations, or makes a general assignment for the benefit of its creditors.(4) A receiver, liquidator, or conservator has been appointed for a licensee.(5) Any fact or condition exists that, if it had existed at the time that the licensee applied for the license, would have been grounds for denying the application.(c) This section shall become operative on January 1, 2023. |
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| 353 | 357 | | |
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| 354 | 358 | | 1789.12.3. (a) The proceedings for a revocation of a license shall be conducted in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code.(b) The commissioner may suspend or revoke a license if, after notice and an opportunity for hearing, the commissioner finds any of the following:(1) The licensee violated this title or a regulation adopted or an order issued under this title.(2) The licensee does not cooperate with an examination or investigation by the commissioner.(3) The licensee is insolvent, suspends payment of its obligations, or makes a general assignment for the benefit of its creditors.(4) A receiver, liquidator, or conservator has been appointed for a licensee.(5) Any fact or condition exists that, if it had existed at the time that the licensee applied for the license, would have been grounds for denying the application.(c) This section shall become operative on January 1, 2023. |
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| 355 | 359 | | |
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| 356 | 360 | | 1789.12.3. (a) The proceedings for a revocation of a license shall be conducted in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code.(b) The commissioner may suspend or revoke a license if, after notice and an opportunity for hearing, the commissioner finds any of the following:(1) The licensee violated this title or a regulation adopted or an order issued under this title.(2) The licensee does not cooperate with an examination or investigation by the commissioner.(3) The licensee is insolvent, suspends payment of its obligations, or makes a general assignment for the benefit of its creditors.(4) A receiver, liquidator, or conservator has been appointed for a licensee.(5) Any fact or condition exists that, if it had existed at the time that the licensee applied for the license, would have been grounds for denying the application.(c) This section shall become operative on January 1, 2023. |
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| 357 | 361 | | |
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| 358 | 362 | | |
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| 359 | 363 | | |
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| 360 | 364 | | 1789.12.3. (a) The proceedings for a revocation of a license shall be conducted in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code. |
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| 361 | 365 | | |
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| 362 | 366 | | (b) The commissioner may suspend or revoke a license if, after notice and an opportunity for hearing, the commissioner finds any of the following: |
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| 363 | 367 | | |
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| 364 | 368 | | (1) The licensee violated this title or a regulation adopted or an order issued under this title. |
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| 365 | 369 | | |
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| 366 | 370 | | (2) The licensee does not cooperate with an examination or investigation by the commissioner. |
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| 367 | 371 | | |
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| 368 | 372 | | (3) The licensee is insolvent, suspends payment of its obligations, or makes a general assignment for the benefit of its creditors. |
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| 369 | 373 | | |
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| 370 | 374 | | (4) A receiver, liquidator, or conservator has been appointed for a licensee. |
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| 371 | 375 | | |
|---|
| 372 | 376 | | (5) Any fact or condition exists that, if it had existed at the time that the licensee applied for the license, would have been grounds for denying the application. |
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| 373 | 377 | | |
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| 374 | 378 | | (c) This section shall become operative on January 1, 2023. |
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| 375 | 379 | | |
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| 376 | 380 | | SEC. 10. Section 1789.12.5 is added to the Civil Code, to read:1789.12.5. (a) Notwithstanding any law the commissioner shall have the authority to conduct investigations and examinations of an applicant or licensee as follows:(1) For purposes of determining whether an applicant is eligible for a license, or that a licensee is complying with the provisions of this title or any regulation or order of the commissioner, the commissioner may access, receive, and use any books, accounts, records, files, documents, information, or evidence that relates to the licensees credit services, including, but not limited to, any of the following relating to the intent to, or the practice of, providing credit services:(A) Criminal, civil, and administrative history information.(B) Personal history and experience information, including, but not limited to, independent credit reports obtained from a consumer reporting agency.(C) Any other documents, information, or evidence that the commissioner deems relevant to the inquiry or investigation regardless of the location, possession, control, or custody of those documents, information, or evidence.(2) For the purposes of investigating violations or complaints arising under this title, the commissioner may direct, subpoena, or order the attendance of, and examine under oath, any person whose testimony may be required about the consumer or the credit services organization.(b) In making any examination or investigation authorized by this section, the commissioner may control access to any documents and records of the licensee or person under examination or investigation. The commissioner may take possession of the documents and records or place a person in exclusive charge of the documents and records in the place where they are usually kept. During the period of control, no person shall remove or attempt to remove any of the documents and records except pursuant to a court order or with the consent of the commissioner. Unless the commissioner has reasonable grounds to believe the documents or records of a licensee have been, or are at risk of being, altered or destroyed for purposes of concealing a violation of this title, the licensee or owner of the documents and records shall have access to the documents or records as necessary to conduct their ordinary business affairs.(c) The commissioner may permit affiliated companies to be subject to a single examination. The department shall list all affiliated company names on the license and shall post them on the departments internet website.(d) This section shall become operative on January 1, 2023. |
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| 377 | 381 | | |
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| 378 | 382 | | SEC. 10. Section 1789.12.5 is added to the Civil Code, to read: |
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| 379 | 383 | | |
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| 380 | 384 | | ### SEC. 10. |
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| 381 | 385 | | |
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| 382 | 386 | | 1789.12.5. (a) Notwithstanding any law the commissioner shall have the authority to conduct investigations and examinations of an applicant or licensee as follows:(1) For purposes of determining whether an applicant is eligible for a license, or that a licensee is complying with the provisions of this title or any regulation or order of the commissioner, the commissioner may access, receive, and use any books, accounts, records, files, documents, information, or evidence that relates to the licensees credit services, including, but not limited to, any of the following relating to the intent to, or the practice of, providing credit services:(A) Criminal, civil, and administrative history information.(B) Personal history and experience information, including, but not limited to, independent credit reports obtained from a consumer reporting agency.(C) Any other documents, information, or evidence that the commissioner deems relevant to the inquiry or investigation regardless of the location, possession, control, or custody of those documents, information, or evidence.(2) For the purposes of investigating violations or complaints arising under this title, the commissioner may direct, subpoena, or order the attendance of, and examine under oath, any person whose testimony may be required about the consumer or the credit services organization.(b) In making any examination or investigation authorized by this section, the commissioner may control access to any documents and records of the licensee or person under examination or investigation. The commissioner may take possession of the documents and records or place a person in exclusive charge of the documents and records in the place where they are usually kept. During the period of control, no person shall remove or attempt to remove any of the documents and records except pursuant to a court order or with the consent of the commissioner. Unless the commissioner has reasonable grounds to believe the documents or records of a licensee have been, or are at risk of being, altered or destroyed for purposes of concealing a violation of this title, the licensee or owner of the documents and records shall have access to the documents or records as necessary to conduct their ordinary business affairs.(c) The commissioner may permit affiliated companies to be subject to a single examination. The department shall list all affiliated company names on the license and shall post them on the departments internet website.(d) This section shall become operative on January 1, 2023. |
|---|
| 383 | 387 | | |
|---|
| 384 | 388 | | 1789.12.5. (a) Notwithstanding any law the commissioner shall have the authority to conduct investigations and examinations of an applicant or licensee as follows:(1) For purposes of determining whether an applicant is eligible for a license, or that a licensee is complying with the provisions of this title or any regulation or order of the commissioner, the commissioner may access, receive, and use any books, accounts, records, files, documents, information, or evidence that relates to the licensees credit services, including, but not limited to, any of the following relating to the intent to, or the practice of, providing credit services:(A) Criminal, civil, and administrative history information.(B) Personal history and experience information, including, but not limited to, independent credit reports obtained from a consumer reporting agency.(C) Any other documents, information, or evidence that the commissioner deems relevant to the inquiry or investigation regardless of the location, possession, control, or custody of those documents, information, or evidence.(2) For the purposes of investigating violations or complaints arising under this title, the commissioner may direct, subpoena, or order the attendance of, and examine under oath, any person whose testimony may be required about the consumer or the credit services organization.(b) In making any examination or investigation authorized by this section, the commissioner may control access to any documents and records of the licensee or person under examination or investigation. The commissioner may take possession of the documents and records or place a person in exclusive charge of the documents and records in the place where they are usually kept. During the period of control, no person shall remove or attempt to remove any of the documents and records except pursuant to a court order or with the consent of the commissioner. Unless the commissioner has reasonable grounds to believe the documents or records of a licensee have been, or are at risk of being, altered or destroyed for purposes of concealing a violation of this title, the licensee or owner of the documents and records shall have access to the documents or records as necessary to conduct their ordinary business affairs.(c) The commissioner may permit affiliated companies to be subject to a single examination. The department shall list all affiliated company names on the license and shall post them on the departments internet website.(d) This section shall become operative on January 1, 2023. |
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| 385 | 389 | | |
|---|
| 386 | 390 | | 1789.12.5. (a) Notwithstanding any law the commissioner shall have the authority to conduct investigations and examinations of an applicant or licensee as follows:(1) For purposes of determining whether an applicant is eligible for a license, or that a licensee is complying with the provisions of this title or any regulation or order of the commissioner, the commissioner may access, receive, and use any books, accounts, records, files, documents, information, or evidence that relates to the licensees credit services, including, but not limited to, any of the following relating to the intent to, or the practice of, providing credit services:(A) Criminal, civil, and administrative history information.(B) Personal history and experience information, including, but not limited to, independent credit reports obtained from a consumer reporting agency.(C) Any other documents, information, or evidence that the commissioner deems relevant to the inquiry or investigation regardless of the location, possession, control, or custody of those documents, information, or evidence.(2) For the purposes of investigating violations or complaints arising under this title, the commissioner may direct, subpoena, or order the attendance of, and examine under oath, any person whose testimony may be required about the consumer or the credit services organization.(b) In making any examination or investigation authorized by this section, the commissioner may control access to any documents and records of the licensee or person under examination or investigation. The commissioner may take possession of the documents and records or place a person in exclusive charge of the documents and records in the place where they are usually kept. During the period of control, no person shall remove or attempt to remove any of the documents and records except pursuant to a court order or with the consent of the commissioner. Unless the commissioner has reasonable grounds to believe the documents or records of a licensee have been, or are at risk of being, altered or destroyed for purposes of concealing a violation of this title, the licensee or owner of the documents and records shall have access to the documents or records as necessary to conduct their ordinary business affairs.(c) The commissioner may permit affiliated companies to be subject to a single examination. The department shall list all affiliated company names on the license and shall post them on the departments internet website.(d) This section shall become operative on January 1, 2023. |
|---|
| 387 | 391 | | |
|---|
| 388 | 392 | | |
|---|
| 389 | 393 | | |
|---|
| 390 | 394 | | 1789.12.5. (a) Notwithstanding any law the commissioner shall have the authority to conduct investigations and examinations of an applicant or licensee as follows: |
|---|
| 391 | 395 | | |
|---|
| 392 | 396 | | (1) For purposes of determining whether an applicant is eligible for a license, or that a licensee is complying with the provisions of this title or any regulation or order of the commissioner, the commissioner may access, receive, and use any books, accounts, records, files, documents, information, or evidence that relates to the licensees credit services, including, but not limited to, any of the following relating to the intent to, or the practice of, providing credit services: |
|---|
| 393 | 397 | | |
|---|
| 394 | 398 | | (A) Criminal, civil, and administrative history information. |
|---|
| 395 | 399 | | |
|---|
| 396 | 400 | | (B) Personal history and experience information, including, but not limited to, independent credit reports obtained from a consumer reporting agency. |
|---|
| 397 | 401 | | |
|---|
| 398 | 402 | | (C) Any other documents, information, or evidence that the commissioner deems relevant to the inquiry or investigation regardless of the location, possession, control, or custody of those documents, information, or evidence. |
|---|
| 399 | 403 | | |
|---|
| 400 | 404 | | (2) For the purposes of investigating violations or complaints arising under this title, the commissioner may direct, subpoena, or order the attendance of, and examine under oath, any person whose testimony may be required about the consumer or the credit services organization. |
|---|
| 401 | 405 | | |
|---|
| 402 | 406 | | (b) In making any examination or investigation authorized by this section, the commissioner may control access to any documents and records of the licensee or person under examination or investigation. The commissioner may take possession of the documents and records or place a person in exclusive charge of the documents and records in the place where they are usually kept. During the period of control, no person shall remove or attempt to remove any of the documents and records except pursuant to a court order or with the consent of the commissioner. Unless the commissioner has reasonable grounds to believe the documents or records of a licensee have been, or are at risk of being, altered or destroyed for purposes of concealing a violation of this title, the licensee or owner of the documents and records shall have access to the documents or records as necessary to conduct their ordinary business affairs. |
|---|
| 403 | 407 | | |
|---|
| 404 | 408 | | (c) The commissioner may permit affiliated companies to be subject to a single examination. The department shall list all affiliated company names on the license and shall post them on the departments internet website. |
|---|
| 405 | 409 | | |
|---|
| 406 | 410 | | (d) This section shall become operative on January 1, 2023. |
|---|
| 407 | 411 | | |
|---|
| 408 | 412 | | SEC. 11. Section 1789.12.7 is added to the Civil Code, to read:1789.12.7. (a) If, in the opinion of the commissioner, a person who is required to be licensed under this title is engaged in the business of providing credit services without a license from the commissioner, or a person or licensee has violated any provision of this title, an order, or a regulation adopted pursuant to this title, the commissioner may do any of the following:(1) After notice and an opportunity for a hearing, order the person or licensee to desist and to refrain from engaging in the business of further continuing the violation.(2) After notice and an opportunity for a hearing, order the person or licensee to pay ancillary relief. The ancillary relief may include, but need not be limited to, refunds, restitution, disgorgement, and payment of damages, as appropriate, on behalf of a person injured by the conduct or practice that constitutes the subject matter of the assessment.(b) If, within 30 days after an order issued pursuant to subdivision (a) or (b) is served, a written request for a hearing is filed and no hearing is held within 30 days thereafter, the order shall be deemed rescinded.(c) This section shall become operative on January 1, 2023. |
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| 409 | 413 | | |
|---|
| 410 | 414 | | SEC. 11. Section 1789.12.7 is added to the Civil Code, to read: |
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| 411 | 415 | | |
|---|
| 412 | 416 | | ### SEC. 11. |
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| 413 | 417 | | |
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| 414 | 418 | | 1789.12.7. (a) If, in the opinion of the commissioner, a person who is required to be licensed under this title is engaged in the business of providing credit services without a license from the commissioner, or a person or licensee has violated any provision of this title, an order, or a regulation adopted pursuant to this title, the commissioner may do any of the following:(1) After notice and an opportunity for a hearing, order the person or licensee to desist and to refrain from engaging in the business of further continuing the violation.(2) After notice and an opportunity for a hearing, order the person or licensee to pay ancillary relief. The ancillary relief may include, but need not be limited to, refunds, restitution, disgorgement, and payment of damages, as appropriate, on behalf of a person injured by the conduct or practice that constitutes the subject matter of the assessment.(b) If, within 30 days after an order issued pursuant to subdivision (a) or (b) is served, a written request for a hearing is filed and no hearing is held within 30 days thereafter, the order shall be deemed rescinded.(c) This section shall become operative on January 1, 2023. |
|---|
| 415 | 419 | | |
|---|
| 416 | 420 | | 1789.12.7. (a) If, in the opinion of the commissioner, a person who is required to be licensed under this title is engaged in the business of providing credit services without a license from the commissioner, or a person or licensee has violated any provision of this title, an order, or a regulation adopted pursuant to this title, the commissioner may do any of the following:(1) After notice and an opportunity for a hearing, order the person or licensee to desist and to refrain from engaging in the business of further continuing the violation.(2) After notice and an opportunity for a hearing, order the person or licensee to pay ancillary relief. The ancillary relief may include, but need not be limited to, refunds, restitution, disgorgement, and payment of damages, as appropriate, on behalf of a person injured by the conduct or practice that constitutes the subject matter of the assessment.(b) If, within 30 days after an order issued pursuant to subdivision (a) or (b) is served, a written request for a hearing is filed and no hearing is held within 30 days thereafter, the order shall be deemed rescinded.(c) This section shall become operative on January 1, 2023. |
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| 417 | 421 | | |
|---|
| 418 | 422 | | 1789.12.7. (a) If, in the opinion of the commissioner, a person who is required to be licensed under this title is engaged in the business of providing credit services without a license from the commissioner, or a person or licensee has violated any provision of this title, an order, or a regulation adopted pursuant to this title, the commissioner may do any of the following:(1) After notice and an opportunity for a hearing, order the person or licensee to desist and to refrain from engaging in the business of further continuing the violation.(2) After notice and an opportunity for a hearing, order the person or licensee to pay ancillary relief. The ancillary relief may include, but need not be limited to, refunds, restitution, disgorgement, and payment of damages, as appropriate, on behalf of a person injured by the conduct or practice that constitutes the subject matter of the assessment.(b) If, within 30 days after an order issued pursuant to subdivision (a) or (b) is served, a written request for a hearing is filed and no hearing is held within 30 days thereafter, the order shall be deemed rescinded.(c) This section shall become operative on January 1, 2023. |
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| 419 | 423 | | |
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| 420 | 424 | | |
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| 421 | 425 | | |
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| 422 | 426 | | 1789.12.7. (a) If, in the opinion of the commissioner, a person who is required to be licensed under this title is engaged in the business of providing credit services without a license from the commissioner, or a person or licensee has violated any provision of this title, an order, or a regulation adopted pursuant to this title, the commissioner may do any of the following: |
|---|
| 423 | 427 | | |
|---|
| 424 | 428 | | (1) After notice and an opportunity for a hearing, order the person or licensee to desist and to refrain from engaging in the business of further continuing the violation. |
|---|
| 425 | 429 | | |
|---|
| 426 | 430 | | (2) After notice and an opportunity for a hearing, order the person or licensee to pay ancillary relief. The ancillary relief may include, but need not be limited to, refunds, restitution, disgorgement, and payment of damages, as appropriate, on behalf of a person injured by the conduct or practice that constitutes the subject matter of the assessment. |
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| 427 | 431 | | |
|---|
| 428 | 432 | | (b) If, within 30 days after an order issued pursuant to subdivision (a) or (b) is served, a written request for a hearing is filed and no hearing is held within 30 days thereafter, the order shall be deemed rescinded. |
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| 429 | 433 | | |
|---|
| 430 | 434 | | (c) This section shall become operative on January 1, 2023. |
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| 431 | 435 | | |
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| 432 | 436 | | SEC. 12. Section 1789.12.9 is added to the Civil Code, to read:1789.12.9. (a) Notwithstanding any law, the commissioner may by rule or order prescribe circumstances under which to accept electronic records or electronic signatures. This section shall not be deemed to require the commissioner to accept electronic records or electronic signatures.(b) For purposes of this section, the following terms have the following meanings:(1) Electronic record means an initial license application, or material modification of that license application, and any other record created, generated, sent, communicated, received, or stored by electronic means. Electronic record also includes, but is not limited to, all of the following electronic documents:(A) An application, amendment, supplement, and exhibit, filed for any license, consent, or other authority.(B) A financial statement, report, or advertising.(C) A surety bond, rider, or endorsement thereto.(D) An order, license, consent, or other authority.(E) A notice of public hearing, accusation, and statement of issues in connection with any application, license, consent, or other authority.(F) A proposed decision of a hearing officer and a decision of the commissioner.(G) The transcripts of a hearing and correspondence between a party and the commissioner directly relating to the record.(H) A release, newsletter, interpretive opinion, determination, or specific ruling.(I) Correspondence between a party and the commissioner directly relating to any document listed in subparagraphs (A) to (H), inclusive.(2) Electronic signature means an electronic sound, symbol, or process attached to or logically associated with an electronic record and executed or adopted by a person with the intent to sign the electronic record.(c) The Legislature finds and declares that the Department has continuously implemented methods to accept records filed electronically, and is encouraged to continue to expand its use of electronic filings to the extent feasible, as budget, resources, and equipment are made available to accomplish that goal. (d) This section shall become operative on January 1, 2023. |
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| 433 | 437 | | |
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| 434 | 438 | | SEC. 12. Section 1789.12.9 is added to the Civil Code, to read: |
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| 435 | 439 | | |
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| 436 | 440 | | ### SEC. 12. |
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| 437 | 441 | | |
|---|
| 438 | 442 | | 1789.12.9. (a) Notwithstanding any law, the commissioner may by rule or order prescribe circumstances under which to accept electronic records or electronic signatures. This section shall not be deemed to require the commissioner to accept electronic records or electronic signatures.(b) For purposes of this section, the following terms have the following meanings:(1) Electronic record means an initial license application, or material modification of that license application, and any other record created, generated, sent, communicated, received, or stored by electronic means. Electronic record also includes, but is not limited to, all of the following electronic documents:(A) An application, amendment, supplement, and exhibit, filed for any license, consent, or other authority.(B) A financial statement, report, or advertising.(C) A surety bond, rider, or endorsement thereto.(D) An order, license, consent, or other authority.(E) A notice of public hearing, accusation, and statement of issues in connection with any application, license, consent, or other authority.(F) A proposed decision of a hearing officer and a decision of the commissioner.(G) The transcripts of a hearing and correspondence between a party and the commissioner directly relating to the record.(H) A release, newsletter, interpretive opinion, determination, or specific ruling.(I) Correspondence between a party and the commissioner directly relating to any document listed in subparagraphs (A) to (H), inclusive.(2) Electronic signature means an electronic sound, symbol, or process attached to or logically associated with an electronic record and executed or adopted by a person with the intent to sign the electronic record.(c) The Legislature finds and declares that the Department has continuously implemented methods to accept records filed electronically, and is encouraged to continue to expand its use of electronic filings to the extent feasible, as budget, resources, and equipment are made available to accomplish that goal. (d) This section shall become operative on January 1, 2023. |
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| 439 | 443 | | |
|---|
| 440 | 444 | | 1789.12.9. (a) Notwithstanding any law, the commissioner may by rule or order prescribe circumstances under which to accept electronic records or electronic signatures. This section shall not be deemed to require the commissioner to accept electronic records or electronic signatures.(b) For purposes of this section, the following terms have the following meanings:(1) Electronic record means an initial license application, or material modification of that license application, and any other record created, generated, sent, communicated, received, or stored by electronic means. Electronic record also includes, but is not limited to, all of the following electronic documents:(A) An application, amendment, supplement, and exhibit, filed for any license, consent, or other authority.(B) A financial statement, report, or advertising.(C) A surety bond, rider, or endorsement thereto.(D) An order, license, consent, or other authority.(E) A notice of public hearing, accusation, and statement of issues in connection with any application, license, consent, or other authority.(F) A proposed decision of a hearing officer and a decision of the commissioner.(G) The transcripts of a hearing and correspondence between a party and the commissioner directly relating to the record.(H) A release, newsletter, interpretive opinion, determination, or specific ruling.(I) Correspondence between a party and the commissioner directly relating to any document listed in subparagraphs (A) to (H), inclusive.(2) Electronic signature means an electronic sound, symbol, or process attached to or logically associated with an electronic record and executed or adopted by a person with the intent to sign the electronic record.(c) The Legislature finds and declares that the Department has continuously implemented methods to accept records filed electronically, and is encouraged to continue to expand its use of electronic filings to the extent feasible, as budget, resources, and equipment are made available to accomplish that goal. (d) This section shall become operative on January 1, 2023. |
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| 441 | 445 | | |
|---|
| 442 | 446 | | 1789.12.9. (a) Notwithstanding any law, the commissioner may by rule or order prescribe circumstances under which to accept electronic records or electronic signatures. This section shall not be deemed to require the commissioner to accept electronic records or electronic signatures.(b) For purposes of this section, the following terms have the following meanings:(1) Electronic record means an initial license application, or material modification of that license application, and any other record created, generated, sent, communicated, received, or stored by electronic means. Electronic record also includes, but is not limited to, all of the following electronic documents:(A) An application, amendment, supplement, and exhibit, filed for any license, consent, or other authority.(B) A financial statement, report, or advertising.(C) A surety bond, rider, or endorsement thereto.(D) An order, license, consent, or other authority.(E) A notice of public hearing, accusation, and statement of issues in connection with any application, license, consent, or other authority.(F) A proposed decision of a hearing officer and a decision of the commissioner.(G) The transcripts of a hearing and correspondence between a party and the commissioner directly relating to the record.(H) A release, newsletter, interpretive opinion, determination, or specific ruling.(I) Correspondence between a party and the commissioner directly relating to any document listed in subparagraphs (A) to (H), inclusive.(2) Electronic signature means an electronic sound, symbol, or process attached to or logically associated with an electronic record and executed or adopted by a person with the intent to sign the electronic record.(c) The Legislature finds and declares that the Department has continuously implemented methods to accept records filed electronically, and is encouraged to continue to expand its use of electronic filings to the extent feasible, as budget, resources, and equipment are made available to accomplish that goal. (d) This section shall become operative on January 1, 2023. |
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| 443 | 447 | | |
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| 444 | 448 | | |
|---|
| 445 | 449 | | |
|---|
| 446 | 450 | | 1789.12.9. (a) Notwithstanding any law, the commissioner may by rule or order prescribe circumstances under which to accept electronic records or electronic signatures. This section shall not be deemed to require the commissioner to accept electronic records or electronic signatures. |
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| 447 | 451 | | |
|---|
| 448 | 452 | | (b) For purposes of this section, the following terms have the following meanings: |
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| 449 | 453 | | |
|---|
| 450 | 454 | | (1) Electronic record means an initial license application, or material modification of that license application, and any other record created, generated, sent, communicated, received, or stored by electronic means. Electronic record also includes, but is not limited to, all of the following electronic documents: |
|---|
| 451 | 455 | | |
|---|
| 452 | 456 | | (A) An application, amendment, supplement, and exhibit, filed for any license, consent, or other authority. |
|---|
| 453 | 457 | | |
|---|
| 454 | 458 | | (B) A financial statement, report, or advertising. |
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| 455 | 459 | | |
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| 456 | 460 | | (C) A surety bond, rider, or endorsement thereto. |
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| 457 | 461 | | |
|---|
| 458 | 462 | | (D) An order, license, consent, or other authority. |
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| 459 | 463 | | |
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| 460 | 464 | | (E) A notice of public hearing, accusation, and statement of issues in connection with any application, license, consent, or other authority. |
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| 461 | 465 | | |
|---|
| 462 | 466 | | (F) A proposed decision of a hearing officer and a decision of the commissioner. |
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| 463 | 467 | | |
|---|
| 464 | 468 | | (G) The transcripts of a hearing and correspondence between a party and the commissioner directly relating to the record. |
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| 465 | 469 | | |
|---|
| 466 | 470 | | (H) A release, newsletter, interpretive opinion, determination, or specific ruling. |
|---|
| 467 | 471 | | |
|---|
| 468 | 472 | | (I) Correspondence between a party and the commissioner directly relating to any document listed in subparagraphs (A) to (H), inclusive. |
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| 469 | 473 | | |
|---|
| 470 | 474 | | (2) Electronic signature means an electronic sound, symbol, or process attached to or logically associated with an electronic record and executed or adopted by a person with the intent to sign the electronic record. |
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| 471 | 475 | | |
|---|
| 472 | 476 | | (c) The Legislature finds and declares that the Department has continuously implemented methods to accept records filed electronically, and is encouraged to continue to expand its use of electronic filings to the extent feasible, as budget, resources, and equipment are made available to accomplish that goal. |
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| 473 | 477 | | |
|---|
| 474 | 478 | | (d) This section shall become operative on January 1, 2023. |
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| 475 | 479 | | |
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| 476 | 480 | | SEC. 13. Section 1789.12.11 is added to the Civil Code, to read:1789.12.11. (a) The commissioner may require an applicant for a license to make some or all of the filings with the commissioner through the Nationwide Multistate Licensing System and Registry.(b) The commissioner may require an application to be made through the Nationwide Multistate Licensing System and Registry, and may require fees, fingerprints, financial statements, supporting documents, changes of address, and any other information, and amendments or modifications thereto, to be submitted by applicants and licensees through the Nationwide Multistate Licensing System and Registry.(c) The commissioner may require licensees to pay annual fees through the Nationwide Multistate Licensing System and Registry.(d) This section shall become operative on January 1, 2023. |
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| 477 | 481 | | |
|---|
| 478 | 482 | | SEC. 13. Section 1789.12.11 is added to the Civil Code, to read: |
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| 479 | 483 | | |
|---|
| 480 | 484 | | ### SEC. 13. |
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| 481 | 485 | | |
|---|
| 482 | 486 | | 1789.12.11. (a) The commissioner may require an applicant for a license to make some or all of the filings with the commissioner through the Nationwide Multistate Licensing System and Registry.(b) The commissioner may require an application to be made through the Nationwide Multistate Licensing System and Registry, and may require fees, fingerprints, financial statements, supporting documents, changes of address, and any other information, and amendments or modifications thereto, to be submitted by applicants and licensees through the Nationwide Multistate Licensing System and Registry.(c) The commissioner may require licensees to pay annual fees through the Nationwide Multistate Licensing System and Registry.(d) This section shall become operative on January 1, 2023. |
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| 483 | 487 | | |
|---|
| 484 | 488 | | 1789.12.11. (a) The commissioner may require an applicant for a license to make some or all of the filings with the commissioner through the Nationwide Multistate Licensing System and Registry.(b) The commissioner may require an application to be made through the Nationwide Multistate Licensing System and Registry, and may require fees, fingerprints, financial statements, supporting documents, changes of address, and any other information, and amendments or modifications thereto, to be submitted by applicants and licensees through the Nationwide Multistate Licensing System and Registry.(c) The commissioner may require licensees to pay annual fees through the Nationwide Multistate Licensing System and Registry.(d) This section shall become operative on January 1, 2023. |
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| 485 | 489 | | |
|---|
| 486 | 490 | | 1789.12.11. (a) The commissioner may require an applicant for a license to make some or all of the filings with the commissioner through the Nationwide Multistate Licensing System and Registry.(b) The commissioner may require an application to be made through the Nationwide Multistate Licensing System and Registry, and may require fees, fingerprints, financial statements, supporting documents, changes of address, and any other information, and amendments or modifications thereto, to be submitted by applicants and licensees through the Nationwide Multistate Licensing System and Registry.(c) The commissioner may require licensees to pay annual fees through the Nationwide Multistate Licensing System and Registry.(d) This section shall become operative on January 1, 2023. |
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| 487 | 491 | | |
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| 488 | 492 | | |
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| 489 | 493 | | |
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| 490 | 494 | | 1789.12.11. (a) The commissioner may require an applicant for a license to make some or all of the filings with the commissioner through the Nationwide Multistate Licensing System and Registry. |
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| 491 | 495 | | |
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| 492 | 496 | | (b) The commissioner may require an application to be made through the Nationwide Multistate Licensing System and Registry, and may require fees, fingerprints, financial statements, supporting documents, changes of address, and any other information, and amendments or modifications thereto, to be submitted by applicants and licensees through the Nationwide Multistate Licensing System and Registry. |
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| 493 | 497 | | |
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| 494 | 498 | | (c) The commissioner may require licensees to pay annual fees through the Nationwide Multistate Licensing System and Registry. |
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| 495 | 499 | | |
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| 496 | 500 | | (d) This section shall become operative on January 1, 2023. |
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| 497 | 501 | | |
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| 498 | 502 | | SEC. 14. Section 1789.12.13 is added to the Civil Code, to read:1789.12.13. (a) The Credit Services Licensing Fund is hereby established within the state treasury.(b) All licensing fees collected shall be deposited into the Fees Account which is hereby established within the fund.(c) All fines and penalties collected shall be deposited into the Penalties Account which is hereby established within the fund.(d) All monies deposited into the fund shall be available to the commissioner, upon appropriation by the Legislature, for the purposes of this title. (e) This section shall become operative on January 1, 2023. |
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| 499 | 503 | | |
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| 500 | 504 | | SEC. 14. Section 1789.12.13 is added to the Civil Code, to read: |
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| 501 | 505 | | |
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| 502 | 506 | | ### SEC. 14. |
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| 503 | 507 | | |
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| 504 | 508 | | 1789.12.13. (a) The Credit Services Licensing Fund is hereby established within the state treasury.(b) All licensing fees collected shall be deposited into the Fees Account which is hereby established within the fund.(c) All fines and penalties collected shall be deposited into the Penalties Account which is hereby established within the fund.(d) All monies deposited into the fund shall be available to the commissioner, upon appropriation by the Legislature, for the purposes of this title. (e) This section shall become operative on January 1, 2023. |
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| 505 | 509 | | |
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| 506 | 510 | | 1789.12.13. (a) The Credit Services Licensing Fund is hereby established within the state treasury.(b) All licensing fees collected shall be deposited into the Fees Account which is hereby established within the fund.(c) All fines and penalties collected shall be deposited into the Penalties Account which is hereby established within the fund.(d) All monies deposited into the fund shall be available to the commissioner, upon appropriation by the Legislature, for the purposes of this title. (e) This section shall become operative on January 1, 2023. |
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| 507 | 511 | | |
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| 508 | 512 | | 1789.12.13. (a) The Credit Services Licensing Fund is hereby established within the state treasury.(b) All licensing fees collected shall be deposited into the Fees Account which is hereby established within the fund.(c) All fines and penalties collected shall be deposited into the Penalties Account which is hereby established within the fund.(d) All monies deposited into the fund shall be available to the commissioner, upon appropriation by the Legislature, for the purposes of this title. (e) This section shall become operative on January 1, 2023. |
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| 509 | 513 | | |
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| 510 | 514 | | |
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| 511 | 515 | | |
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| 512 | 516 | | 1789.12.13. (a) The Credit Services Licensing Fund is hereby established within the state treasury. |
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| 513 | 517 | | |
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| 514 | 518 | | (b) All licensing fees collected shall be deposited into the Fees Account which is hereby established within the fund. |
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| 515 | 519 | | |
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| 516 | 520 | | (c) All fines and penalties collected shall be deposited into the Penalties Account which is hereby established within the fund. |
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| 517 | 521 | | |
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| 518 | 522 | | (d) All monies deposited into the fund shall be available to the commissioner, upon appropriation by the Legislature, for the purposes of this title. |
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| 519 | 523 | | |
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| 520 | 524 | | (e) This section shall become operative on January 1, 2023. |
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| 521 | 525 | | |
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| 522 | 526 | | SEC. 15. Section 1789.12.15 is added to the Civil Code, to read:1789.12.15. An applicant shall apply for a license by submitting all of the following to the commissioner:(a) A completed application for a license in a form prescribed by the commissioner and signed under penalty of perjury. Every application shall include the location of the applicants principal place of business and all branch office locations.(b) An application fee and investigation fee, the amount of which shall be determined by the department, to cover any costs incurred in processing an application, including a fingerprint processing and criminal history record check under Section 1789.12.7. The investigation fee, including the amount for the criminal history record check, and the application fee are not refundable if an application is denied or withdrawn.(c) This section shall become operative on January 1, 2023. |
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| 523 | 527 | | |
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| 524 | 528 | | SEC. 15. Section 1789.12.15 is added to the Civil Code, to read: |
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| 525 | 529 | | |
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| 526 | 530 | | ### SEC. 15. |
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| 527 | 531 | | |
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| 528 | 532 | | 1789.12.15. An applicant shall apply for a license by submitting all of the following to the commissioner:(a) A completed application for a license in a form prescribed by the commissioner and signed under penalty of perjury. Every application shall include the location of the applicants principal place of business and all branch office locations.(b) An application fee and investigation fee, the amount of which shall be determined by the department, to cover any costs incurred in processing an application, including a fingerprint processing and criminal history record check under Section 1789.12.7. The investigation fee, including the amount for the criminal history record check, and the application fee are not refundable if an application is denied or withdrawn.(c) This section shall become operative on January 1, 2023. |
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| 529 | 533 | | |
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| 530 | 534 | | 1789.12.15. An applicant shall apply for a license by submitting all of the following to the commissioner:(a) A completed application for a license in a form prescribed by the commissioner and signed under penalty of perjury. Every application shall include the location of the applicants principal place of business and all branch office locations.(b) An application fee and investigation fee, the amount of which shall be determined by the department, to cover any costs incurred in processing an application, including a fingerprint processing and criminal history record check under Section 1789.12.7. The investigation fee, including the amount for the criminal history record check, and the application fee are not refundable if an application is denied or withdrawn.(c) This section shall become operative on January 1, 2023. |
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| 531 | 535 | | |
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| 532 | 536 | | 1789.12.15. An applicant shall apply for a license by submitting all of the following to the commissioner:(a) A completed application for a license in a form prescribed by the commissioner and signed under penalty of perjury. Every application shall include the location of the applicants principal place of business and all branch office locations.(b) An application fee and investigation fee, the amount of which shall be determined by the department, to cover any costs incurred in processing an application, including a fingerprint processing and criminal history record check under Section 1789.12.7. The investigation fee, including the amount for the criminal history record check, and the application fee are not refundable if an application is denied or withdrawn.(c) This section shall become operative on January 1, 2023. |
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| 533 | 537 | | |
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| 534 | 538 | | |
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| 535 | 539 | | |
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| 536 | 540 | | 1789.12.15. An applicant shall apply for a license by submitting all of the following to the commissioner: |
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| 537 | 541 | | |
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| 538 | 542 | | (a) A completed application for a license in a form prescribed by the commissioner and signed under penalty of perjury. Every application shall include the location of the applicants principal place of business and all branch office locations. |
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| 539 | 543 | | |
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| 540 | 544 | | (b) An application fee and investigation fee, the amount of which shall be determined by the department, to cover any costs incurred in processing an application, including a fingerprint processing and criminal history record check under Section 1789.12.7. The investigation fee, including the amount for the criminal history record check, and the application fee are not refundable if an application is denied or withdrawn. |
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| 541 | 545 | | |
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| 542 | 546 | | (c) This section shall become operative on January 1, 2023. |
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| 543 | 547 | | |
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| 544 | 548 | | SEC. 16. Section 1789.12.17 is added to the Civil Code, to read:1789.12.17. (a) The commissioner shall submit to the Department of Justice fingerprint images and related information required by the Department of Justice of every applicant, as defined in paragraph (1) of subdivision (a) of Section 1789.12, for purposes of obtaining information as to the existence and content of a record of state or federal convictions, state or federal arrests, and information as to the existence and content of a record of state or federal arrests for which the Department of Justice establishes that the person is free on bail or on their own recognizance pending trial or appeal.(b) When received, the Department of Justice shall transmit fingerprint images and related information received pursuant to this section to the Federal Bureau of Investigation for the purpose of obtaining a federal criminal history records check. The Department of Justice shall review the information returned from the Federal Bureau of Investigation and compile and disseminate a response to the commissioner.(c) The Department of Justice shall provide a state or federal response to the commissioner pursuant to paragraph (1) of subdivision (p) of Section 11105 of the Penal Code.(d) The commissioner shall request from the Department of Justice subsequent arrest notification service, as provided pursuant to Section 11105.2 of the Penal Code, for the license applicant described in subdivision (a).(e) The Department of Justice shall charge a fee, payable by the applicant, sufficient to cover the costs of processing the requests pursuant to this section.(f) This section shall become operative on January 1, 2023. |
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| 545 | 549 | | |
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| 546 | 550 | | SEC. 16. Section 1789.12.17 is added to the Civil Code, to read: |
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| 547 | 551 | | |
|---|
| 548 | 552 | | ### SEC. 16. |
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| 549 | 553 | | |
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| 550 | 554 | | 1789.12.17. (a) The commissioner shall submit to the Department of Justice fingerprint images and related information required by the Department of Justice of every applicant, as defined in paragraph (1) of subdivision (a) of Section 1789.12, for purposes of obtaining information as to the existence and content of a record of state or federal convictions, state or federal arrests, and information as to the existence and content of a record of state or federal arrests for which the Department of Justice establishes that the person is free on bail or on their own recognizance pending trial or appeal.(b) When received, the Department of Justice shall transmit fingerprint images and related information received pursuant to this section to the Federal Bureau of Investigation for the purpose of obtaining a federal criminal history records check. The Department of Justice shall review the information returned from the Federal Bureau of Investigation and compile and disseminate a response to the commissioner.(c) The Department of Justice shall provide a state or federal response to the commissioner pursuant to paragraph (1) of subdivision (p) of Section 11105 of the Penal Code.(d) The commissioner shall request from the Department of Justice subsequent arrest notification service, as provided pursuant to Section 11105.2 of the Penal Code, for the license applicant described in subdivision (a).(e) The Department of Justice shall charge a fee, payable by the applicant, sufficient to cover the costs of processing the requests pursuant to this section.(f) This section shall become operative on January 1, 2023. |
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| 551 | 555 | | |
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| 552 | 556 | | 1789.12.17. (a) The commissioner shall submit to the Department of Justice fingerprint images and related information required by the Department of Justice of every applicant, as defined in paragraph (1) of subdivision (a) of Section 1789.12, for purposes of obtaining information as to the existence and content of a record of state or federal convictions, state or federal arrests, and information as to the existence and content of a record of state or federal arrests for which the Department of Justice establishes that the person is free on bail or on their own recognizance pending trial or appeal.(b) When received, the Department of Justice shall transmit fingerprint images and related information received pursuant to this section to the Federal Bureau of Investigation for the purpose of obtaining a federal criminal history records check. The Department of Justice shall review the information returned from the Federal Bureau of Investigation and compile and disseminate a response to the commissioner.(c) The Department of Justice shall provide a state or federal response to the commissioner pursuant to paragraph (1) of subdivision (p) of Section 11105 of the Penal Code.(d) The commissioner shall request from the Department of Justice subsequent arrest notification service, as provided pursuant to Section 11105.2 of the Penal Code, for the license applicant described in subdivision (a).(e) The Department of Justice shall charge a fee, payable by the applicant, sufficient to cover the costs of processing the requests pursuant to this section.(f) This section shall become operative on January 1, 2023. |
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| 553 | 557 | | |
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| 554 | 558 | | 1789.12.17. (a) The commissioner shall submit to the Department of Justice fingerprint images and related information required by the Department of Justice of every applicant, as defined in paragraph (1) of subdivision (a) of Section 1789.12, for purposes of obtaining information as to the existence and content of a record of state or federal convictions, state or federal arrests, and information as to the existence and content of a record of state or federal arrests for which the Department of Justice establishes that the person is free on bail or on their own recognizance pending trial or appeal.(b) When received, the Department of Justice shall transmit fingerprint images and related information received pursuant to this section to the Federal Bureau of Investigation for the purpose of obtaining a federal criminal history records check. The Department of Justice shall review the information returned from the Federal Bureau of Investigation and compile and disseminate a response to the commissioner.(c) The Department of Justice shall provide a state or federal response to the commissioner pursuant to paragraph (1) of subdivision (p) of Section 11105 of the Penal Code.(d) The commissioner shall request from the Department of Justice subsequent arrest notification service, as provided pursuant to Section 11105.2 of the Penal Code, for the license applicant described in subdivision (a).(e) The Department of Justice shall charge a fee, payable by the applicant, sufficient to cover the costs of processing the requests pursuant to this section.(f) This section shall become operative on January 1, 2023. |
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| 555 | 559 | | |
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| 556 | 560 | | |
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| 557 | 561 | | |
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| 558 | 562 | | 1789.12.17. (a) The commissioner shall submit to the Department of Justice fingerprint images and related information required by the Department of Justice of every applicant, as defined in paragraph (1) of subdivision (a) of Section 1789.12, for purposes of obtaining information as to the existence and content of a record of state or federal convictions, state or federal arrests, and information as to the existence and content of a record of state or federal arrests for which the Department of Justice establishes that the person is free on bail or on their own recognizance pending trial or appeal. |
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| 559 | 563 | | |
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| 560 | 564 | | (b) When received, the Department of Justice shall transmit fingerprint images and related information received pursuant to this section to the Federal Bureau of Investigation for the purpose of obtaining a federal criminal history records check. The Department of Justice shall review the information returned from the Federal Bureau of Investigation and compile and disseminate a response to the commissioner. |
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| 561 | 565 | | |
|---|
| 562 | 566 | | (c) The Department of Justice shall provide a state or federal response to the commissioner pursuant to paragraph (1) of subdivision (p) of Section 11105 of the Penal Code. |
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| 563 | 567 | | |
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| 564 | 568 | | (d) The commissioner shall request from the Department of Justice subsequent arrest notification service, as provided pursuant to Section 11105.2 of the Penal Code, for the license applicant described in subdivision (a). |
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| 565 | 569 | | |
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| 566 | 570 | | (e) The Department of Justice shall charge a fee, payable by the applicant, sufficient to cover the costs of processing the requests pursuant to this section. |
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| 567 | 571 | | |
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| 568 | 572 | | (f) This section shall become operative on January 1, 2023. |
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| 569 | 573 | | |
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| 570 | 574 | | SEC. 17. Section 1789.12.19 is added to the Civil Code, to read:1789.12.19. (a) (1) Upon the filing of an application for a license pursuant to Section 1789.25 and the payment of the fees, if the applicant is a partnership, the commissioner shall investigate the applicant and its general partners and individuals owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or any individual responsible for the conduct of the applicants servicing activities in this state.(2) Upon the filing of an application for a license pursuant to Section 1789.25 and the payment of the fees, if the applicant is a corporation, trust, limited liability company, or association, including an unincorporated organization, the commissioner shall investigate the applicant, its principal officers, directors, trustee, managing members, and individuals owning or controlling, directly or indirectly, 10 percent or more of the outstanding equity securities or any individual responsible for the conduct of the applicants credit services in this state.(b) Upon the filing of an application for a license pursuant to Section 1789.25 and the payment of the fees, the commissioner shall investigate the individual responsible for the credit services of the licensee at the location described in the application. The investigation may be limited to information that was not included in prior applications filed pursuant to this title.(c) For the purposes of this section, principal officers shall mean president, chief executive officer, treasurer, and chief financial officer, as may be applicable, and any other officer with direct responsibility for the conduct of the applicants credit services in this state.(d) This section shall become operative on January 1, 2023. |
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| 571 | 575 | | |
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| 572 | 576 | | SEC. 17. Section 1789.12.19 is added to the Civil Code, to read: |
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| 573 | 577 | | |
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| 574 | 578 | | ### SEC. 17. |
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| 575 | 579 | | |
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| 576 | 580 | | 1789.12.19. (a) (1) Upon the filing of an application for a license pursuant to Section 1789.25 and the payment of the fees, if the applicant is a partnership, the commissioner shall investigate the applicant and its general partners and individuals owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or any individual responsible for the conduct of the applicants servicing activities in this state.(2) Upon the filing of an application for a license pursuant to Section 1789.25 and the payment of the fees, if the applicant is a corporation, trust, limited liability company, or association, including an unincorporated organization, the commissioner shall investigate the applicant, its principal officers, directors, trustee, managing members, and individuals owning or controlling, directly or indirectly, 10 percent or more of the outstanding equity securities or any individual responsible for the conduct of the applicants credit services in this state.(b) Upon the filing of an application for a license pursuant to Section 1789.25 and the payment of the fees, the commissioner shall investigate the individual responsible for the credit services of the licensee at the location described in the application. The investigation may be limited to information that was not included in prior applications filed pursuant to this title.(c) For the purposes of this section, principal officers shall mean president, chief executive officer, treasurer, and chief financial officer, as may be applicable, and any other officer with direct responsibility for the conduct of the applicants credit services in this state.(d) This section shall become operative on January 1, 2023. |
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| 577 | 581 | | |
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| 578 | 582 | | 1789.12.19. (a) (1) Upon the filing of an application for a license pursuant to Section 1789.25 and the payment of the fees, if the applicant is a partnership, the commissioner shall investigate the applicant and its general partners and individuals owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or any individual responsible for the conduct of the applicants servicing activities in this state.(2) Upon the filing of an application for a license pursuant to Section 1789.25 and the payment of the fees, if the applicant is a corporation, trust, limited liability company, or association, including an unincorporated organization, the commissioner shall investigate the applicant, its principal officers, directors, trustee, managing members, and individuals owning or controlling, directly or indirectly, 10 percent or more of the outstanding equity securities or any individual responsible for the conduct of the applicants credit services in this state.(b) Upon the filing of an application for a license pursuant to Section 1789.25 and the payment of the fees, the commissioner shall investigate the individual responsible for the credit services of the licensee at the location described in the application. The investigation may be limited to information that was not included in prior applications filed pursuant to this title.(c) For the purposes of this section, principal officers shall mean president, chief executive officer, treasurer, and chief financial officer, as may be applicable, and any other officer with direct responsibility for the conduct of the applicants credit services in this state.(d) This section shall become operative on January 1, 2023. |
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| 579 | 583 | | |
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| 580 | 584 | | 1789.12.19. (a) (1) Upon the filing of an application for a license pursuant to Section 1789.25 and the payment of the fees, if the applicant is a partnership, the commissioner shall investigate the applicant and its general partners and individuals owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or any individual responsible for the conduct of the applicants servicing activities in this state.(2) Upon the filing of an application for a license pursuant to Section 1789.25 and the payment of the fees, if the applicant is a corporation, trust, limited liability company, or association, including an unincorporated organization, the commissioner shall investigate the applicant, its principal officers, directors, trustee, managing members, and individuals owning or controlling, directly or indirectly, 10 percent or more of the outstanding equity securities or any individual responsible for the conduct of the applicants credit services in this state.(b) Upon the filing of an application for a license pursuant to Section 1789.25 and the payment of the fees, the commissioner shall investigate the individual responsible for the credit services of the licensee at the location described in the application. The investigation may be limited to information that was not included in prior applications filed pursuant to this title.(c) For the purposes of this section, principal officers shall mean president, chief executive officer, treasurer, and chief financial officer, as may be applicable, and any other officer with direct responsibility for the conduct of the applicants credit services in this state.(d) This section shall become operative on January 1, 2023. |
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| 581 | 585 | | |
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| 582 | 586 | | |
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| 583 | 587 | | |
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| 584 | 588 | | 1789.12.19. (a) (1) Upon the filing of an application for a license pursuant to Section 1789.25 and the payment of the fees, if the applicant is a partnership, the commissioner shall investigate the applicant and its general partners and individuals owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or any individual responsible for the conduct of the applicants servicing activities in this state. |
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| 585 | 589 | | |
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| 586 | 590 | | (2) Upon the filing of an application for a license pursuant to Section 1789.25 and the payment of the fees, if the applicant is a corporation, trust, limited liability company, or association, including an unincorporated organization, the commissioner shall investigate the applicant, its principal officers, directors, trustee, managing members, and individuals owning or controlling, directly or indirectly, 10 percent or more of the outstanding equity securities or any individual responsible for the conduct of the applicants credit services in this state. |
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| 587 | 591 | | |
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| 588 | 592 | | (b) Upon the filing of an application for a license pursuant to Section 1789.25 and the payment of the fees, the commissioner shall investigate the individual responsible for the credit services of the licensee at the location described in the application. The investigation may be limited to information that was not included in prior applications filed pursuant to this title. |
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| 589 | 593 | | |
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| 590 | 594 | | (c) For the purposes of this section, principal officers shall mean president, chief executive officer, treasurer, and chief financial officer, as may be applicable, and any other officer with direct responsibility for the conduct of the applicants credit services in this state. |
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| 591 | 595 | | |
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| 592 | 596 | | (d) This section shall become operative on January 1, 2023. |
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| 593 | 597 | | |
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| 594 | 598 | | SEC. 18. Section 1789.12.21 is added to the Civil Code, to read:1789.12.21. (a) When the application is complete, including the information from the Department of Justice, and the commissioner determines that the applicant has satisfied the requirements set forth in this title and does not find facts constituting reasons for denial, the commissioner shall issue and deliver a license to the applicant.(b) If the commissioner determines that the requirements have not been satisfied, after notice and an opportunity for a hearing, the commissioner may deny the application and shall provide a written explanation for the denial.(c) This section shall become operative on January 1, 2023. |
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| 595 | 599 | | |
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| 596 | 600 | | SEC. 18. Section 1789.12.21 is added to the Civil Code, to read: |
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| 597 | 601 | | |
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| 598 | 602 | | ### SEC. 18. |
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| 599 | 603 | | |
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| 600 | 604 | | 1789.12.21. (a) When the application is complete, including the information from the Department of Justice, and the commissioner determines that the applicant has satisfied the requirements set forth in this title and does not find facts constituting reasons for denial, the commissioner shall issue and deliver a license to the applicant.(b) If the commissioner determines that the requirements have not been satisfied, after notice and an opportunity for a hearing, the commissioner may deny the application and shall provide a written explanation for the denial.(c) This section shall become operative on January 1, 2023. |
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| 601 | 605 | | |
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| 602 | 606 | | 1789.12.21. (a) When the application is complete, including the information from the Department of Justice, and the commissioner determines that the applicant has satisfied the requirements set forth in this title and does not find facts constituting reasons for denial, the commissioner shall issue and deliver a license to the applicant.(b) If the commissioner determines that the requirements have not been satisfied, after notice and an opportunity for a hearing, the commissioner may deny the application and shall provide a written explanation for the denial.(c) This section shall become operative on January 1, 2023. |
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| 603 | 607 | | |
|---|
| 604 | 608 | | 1789.12.21. (a) When the application is complete, including the information from the Department of Justice, and the commissioner determines that the applicant has satisfied the requirements set forth in this title and does not find facts constituting reasons for denial, the commissioner shall issue and deliver a license to the applicant.(b) If the commissioner determines that the requirements have not been satisfied, after notice and an opportunity for a hearing, the commissioner may deny the application and shall provide a written explanation for the denial.(c) This section shall become operative on January 1, 2023. |
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| 605 | 609 | | |
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| 606 | 610 | | |
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| 607 | 611 | | |
|---|
| 608 | 612 | | 1789.12.21. (a) When the application is complete, including the information from the Department of Justice, and the commissioner determines that the applicant has satisfied the requirements set forth in this title and does not find facts constituting reasons for denial, the commissioner shall issue and deliver a license to the applicant. |
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| 609 | 613 | | |
|---|
| 610 | 614 | | (b) If the commissioner determines that the requirements have not been satisfied, after notice and an opportunity for a hearing, the commissioner may deny the application and shall provide a written explanation for the denial. |
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| 611 | 615 | | |
|---|
| 612 | 616 | | (c) This section shall become operative on January 1, 2023. |
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| 613 | 617 | | |
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| 614 | 618 | | SEC. 19. Section 1789.12.23 is added to the Civil Code, to read:1789.12.23. (a) The proceedings for a denial of a license shall be conducted in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code.(b) After notice and an opportunity for a hearing, the commissioner may deny an application for a license for any of the following reasons:(1) A false statement of a material fact has been made in the application.(2) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, within the last 10 years has (A) been convicted of, or pleaded nolo contendere to, a crime, other than traffic violations, or (B) committed any act involving dishonesty, fraud, or deceit, if the crime or act is substantially related to the qualifications, functions, or duties of a person engaged in business in accordance with this title.(3) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, has violated, or is not in material compliance with this title, or an order or rule of the commissioner.(4) A material requirement for issuance of a license has not been met, provided that a written notice of a material omission shall first be sent to the applicant with an opportunity to correct the omission prior to the applicants denial.(5) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, has violated this title or the rules thereunder, or any similar regulatory scheme of this or a foreign jurisdiction.(6) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, has been held liable by final judgment in a civil action under this title.(7) The commissioner, based on its investigation of the applicant, is unable to find that the financial responsibility, criminal records, experience, character, and general fitness of the applicant and its general partners, managing members, principal officers and directors, and individuals owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, support a finding that the business will be operated honestly, fairly, efficiently, and in accordance with the requirements of this title.(8) The commissioner may adopt regulations specifying the factors that the commissioner will consider in denying a license, including, but not limited to, the harm to the consumer, the frequency of prior violations, and the number of prior disciplinary actions taken against the licensee in California or in other states.(c) This section shall become operative on January 1, 2023. |
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| 615 | 619 | | |
|---|
| 616 | 620 | | SEC. 19. Section 1789.12.23 is added to the Civil Code, to read: |
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| 617 | 621 | | |
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| 618 | 622 | | ### SEC. 19. |
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| 619 | 623 | | |
|---|
| 620 | 624 | | 1789.12.23. (a) The proceedings for a denial of a license shall be conducted in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code.(b) After notice and an opportunity for a hearing, the commissioner may deny an application for a license for any of the following reasons:(1) A false statement of a material fact has been made in the application.(2) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, within the last 10 years has (A) been convicted of, or pleaded nolo contendere to, a crime, other than traffic violations, or (B) committed any act involving dishonesty, fraud, or deceit, if the crime or act is substantially related to the qualifications, functions, or duties of a person engaged in business in accordance with this title.(3) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, has violated, or is not in material compliance with this title, or an order or rule of the commissioner.(4) A material requirement for issuance of a license has not been met, provided that a written notice of a material omission shall first be sent to the applicant with an opportunity to correct the omission prior to the applicants denial.(5) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, has violated this title or the rules thereunder, or any similar regulatory scheme of this or a foreign jurisdiction.(6) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, has been held liable by final judgment in a civil action under this title.(7) The commissioner, based on its investigation of the applicant, is unable to find that the financial responsibility, criminal records, experience, character, and general fitness of the applicant and its general partners, managing members, principal officers and directors, and individuals owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, support a finding that the business will be operated honestly, fairly, efficiently, and in accordance with the requirements of this title.(8) The commissioner may adopt regulations specifying the factors that the commissioner will consider in denying a license, including, but not limited to, the harm to the consumer, the frequency of prior violations, and the number of prior disciplinary actions taken against the licensee in California or in other states.(c) This section shall become operative on January 1, 2023. |
|---|
| 621 | 625 | | |
|---|
| 622 | 626 | | 1789.12.23. (a) The proceedings for a denial of a license shall be conducted in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code.(b) After notice and an opportunity for a hearing, the commissioner may deny an application for a license for any of the following reasons:(1) A false statement of a material fact has been made in the application.(2) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, within the last 10 years has (A) been convicted of, or pleaded nolo contendere to, a crime, other than traffic violations, or (B) committed any act involving dishonesty, fraud, or deceit, if the crime or act is substantially related to the qualifications, functions, or duties of a person engaged in business in accordance with this title.(3) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, has violated, or is not in material compliance with this title, or an order or rule of the commissioner.(4) A material requirement for issuance of a license has not been met, provided that a written notice of a material omission shall first be sent to the applicant with an opportunity to correct the omission prior to the applicants denial.(5) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, has violated this title or the rules thereunder, or any similar regulatory scheme of this or a foreign jurisdiction.(6) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, has been held liable by final judgment in a civil action under this title.(7) The commissioner, based on its investigation of the applicant, is unable to find that the financial responsibility, criminal records, experience, character, and general fitness of the applicant and its general partners, managing members, principal officers and directors, and individuals owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, support a finding that the business will be operated honestly, fairly, efficiently, and in accordance with the requirements of this title.(8) The commissioner may adopt regulations specifying the factors that the commissioner will consider in denying a license, including, but not limited to, the harm to the consumer, the frequency of prior violations, and the number of prior disciplinary actions taken against the licensee in California or in other states.(c) This section shall become operative on January 1, 2023. |
|---|
| 623 | 627 | | |
|---|
| 624 | 628 | | 1789.12.23. (a) The proceedings for a denial of a license shall be conducted in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code.(b) After notice and an opportunity for a hearing, the commissioner may deny an application for a license for any of the following reasons:(1) A false statement of a material fact has been made in the application.(2) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, within the last 10 years has (A) been convicted of, or pleaded nolo contendere to, a crime, other than traffic violations, or (B) committed any act involving dishonesty, fraud, or deceit, if the crime or act is substantially related to the qualifications, functions, or duties of a person engaged in business in accordance with this title.(3) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, has violated, or is not in material compliance with this title, or an order or rule of the commissioner.(4) A material requirement for issuance of a license has not been met, provided that a written notice of a material omission shall first be sent to the applicant with an opportunity to correct the omission prior to the applicants denial.(5) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, has violated this title or the rules thereunder, or any similar regulatory scheme of this or a foreign jurisdiction.(6) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, has been held liable by final judgment in a civil action under this title.(7) The commissioner, based on its investigation of the applicant, is unable to find that the financial responsibility, criminal records, experience, character, and general fitness of the applicant and its general partners, managing members, principal officers and directors, and individuals owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, support a finding that the business will be operated honestly, fairly, efficiently, and in accordance with the requirements of this title.(8) The commissioner may adopt regulations specifying the factors that the commissioner will consider in denying a license, including, but not limited to, the harm to the consumer, the frequency of prior violations, and the number of prior disciplinary actions taken against the licensee in California or in other states.(c) This section shall become operative on January 1, 2023. |
|---|
| 625 | 629 | | |
|---|
| 626 | 630 | | |
|---|
| 627 | 631 | | |
|---|
| 628 | 632 | | 1789.12.23. (a) The proceedings for a denial of a license shall be conducted in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code. |
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| 629 | 633 | | |
|---|
| 630 | 634 | | (b) After notice and an opportunity for a hearing, the commissioner may deny an application for a license for any of the following reasons: |
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| 631 | 635 | | |
|---|
| 632 | 636 | | (1) A false statement of a material fact has been made in the application. |
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| 633 | 637 | | |
|---|
| 634 | 638 | | (2) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, within the last 10 years has (A) been convicted of, or pleaded nolo contendere to, a crime, other than traffic violations, or (B) committed any act involving dishonesty, fraud, or deceit, if the crime or act is substantially related to the qualifications, functions, or duties of a person engaged in business in accordance with this title. |
|---|
| 635 | 639 | | |
|---|
| 636 | 640 | | (3) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, has violated, or is not in material compliance with this title, or an order or rule of the commissioner. |
|---|
| 637 | 641 | | |
|---|
| 638 | 642 | | (4) A material requirement for issuance of a license has not been met, provided that a written notice of a material omission shall first be sent to the applicant with an opportunity to correct the omission prior to the applicants denial. |
|---|
| 639 | 643 | | |
|---|
| 640 | 644 | | (5) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, has violated this title or the rules thereunder, or any similar regulatory scheme of this or a foreign jurisdiction. |
|---|
| 641 | 645 | | |
|---|
| 642 | 646 | | (6) The applicant or any principal officer, director, general partner, managing member, or individual owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, has been held liable by final judgment in a civil action under this title. |
|---|
| 643 | 647 | | |
|---|
| 644 | 648 | | (7) The commissioner, based on its investigation of the applicant, is unable to find that the financial responsibility, criminal records, experience, character, and general fitness of the applicant and its general partners, managing members, principal officers and directors, and individuals owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant, support a finding that the business will be operated honestly, fairly, efficiently, and in accordance with the requirements of this title. |
|---|
| 645 | 649 | | |
|---|
| 646 | 650 | | (8) The commissioner may adopt regulations specifying the factors that the commissioner will consider in denying a license, including, but not limited to, the harm to the consumer, the frequency of prior violations, and the number of prior disciplinary actions taken against the licensee in California or in other states. |
|---|
| 647 | 651 | | |
|---|
| 648 | 652 | | (c) This section shall become operative on January 1, 2023. |
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| 649 | 653 | | |
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| 650 | 654 | | SEC. 20. Section 1789.12.25 is added to the Civil Code, to read:1789.12.25. (a) The commissioner may deem an application for a license abandoned if the applicant fails to respond to any request for information required by the commissioner or department during an investigation of the application.(b) The commissioner shall notify the applicant, in writing, that if the applicant fails to submit responsive information within 60 days from the date the commissioner sent the written request for information, the commissioner shall deem the application abandoned.(c) An application fee paid prior to the date an application is deemed abandoned shall not be refunded. Abandonment of an application pursuant to this subdivision shall not preclude the applicant from submitting a new application and fee for a license.(d) This section shall become operative on January 1, 2023. |
|---|
| 651 | 655 | | |
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| 652 | 656 | | SEC. 20. Section 1789.12.25 is added to the Civil Code, to read: |
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| 653 | 657 | | |
|---|
| 654 | 658 | | ### SEC. 20. |
|---|
| 655 | 659 | | |
|---|
| 656 | 660 | | 1789.12.25. (a) The commissioner may deem an application for a license abandoned if the applicant fails to respond to any request for information required by the commissioner or department during an investigation of the application.(b) The commissioner shall notify the applicant, in writing, that if the applicant fails to submit responsive information within 60 days from the date the commissioner sent the written request for information, the commissioner shall deem the application abandoned.(c) An application fee paid prior to the date an application is deemed abandoned shall not be refunded. Abandonment of an application pursuant to this subdivision shall not preclude the applicant from submitting a new application and fee for a license.(d) This section shall become operative on January 1, 2023. |
|---|
| 657 | 661 | | |
|---|
| 658 | 662 | | 1789.12.25. (a) The commissioner may deem an application for a license abandoned if the applicant fails to respond to any request for information required by the commissioner or department during an investigation of the application.(b) The commissioner shall notify the applicant, in writing, that if the applicant fails to submit responsive information within 60 days from the date the commissioner sent the written request for information, the commissioner shall deem the application abandoned.(c) An application fee paid prior to the date an application is deemed abandoned shall not be refunded. Abandonment of an application pursuant to this subdivision shall not preclude the applicant from submitting a new application and fee for a license.(d) This section shall become operative on January 1, 2023. |
|---|
| 659 | 663 | | |
|---|
| 660 | 664 | | 1789.12.25. (a) The commissioner may deem an application for a license abandoned if the applicant fails to respond to any request for information required by the commissioner or department during an investigation of the application.(b) The commissioner shall notify the applicant, in writing, that if the applicant fails to submit responsive information within 60 days from the date the commissioner sent the written request for information, the commissioner shall deem the application abandoned.(c) An application fee paid prior to the date an application is deemed abandoned shall not be refunded. Abandonment of an application pursuant to this subdivision shall not preclude the applicant from submitting a new application and fee for a license.(d) This section shall become operative on January 1, 2023. |
|---|
| 661 | 665 | | |
|---|
| 662 | 666 | | |
|---|
| 663 | 667 | | |
|---|
| 664 | 668 | | 1789.12.25. (a) The commissioner may deem an application for a license abandoned if the applicant fails to respond to any request for information required by the commissioner or department during an investigation of the application. |
|---|
| 665 | 669 | | |
|---|
| 666 | 670 | | (b) The commissioner shall notify the applicant, in writing, that if the applicant fails to submit responsive information within 60 days from the date the commissioner sent the written request for information, the commissioner shall deem the application abandoned. |
|---|
| 667 | 671 | | |
|---|
| 668 | 672 | | (c) An application fee paid prior to the date an application is deemed abandoned shall not be refunded. Abandonment of an application pursuant to this subdivision shall not preclude the applicant from submitting a new application and fee for a license. |
|---|
| 669 | 673 | | |
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| 670 | 674 | | (d) This section shall become operative on January 1, 2023. |
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| 671 | 675 | | |
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| 672 | 676 | | SEC. 21. Section 1789.12.27 is added to the Civil Code, to read:1789.12.27. (a) A license shall remain effective until the license is either suspended or revoked by the commissioner or surrendered by the licensee.(b) This section shall become operative on January 1, 2023. |
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| 673 | 677 | | |
|---|
| 674 | 678 | | SEC. 21. Section 1789.12.27 is added to the Civil Code, to read: |
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| 675 | 679 | | |
|---|
| 676 | 680 | | ### SEC. 21. |
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| 677 | 681 | | |
|---|
| 678 | 682 | | 1789.12.27. (a) A license shall remain effective until the license is either suspended or revoked by the commissioner or surrendered by the licensee.(b) This section shall become operative on January 1, 2023. |
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| 679 | 683 | | |
|---|
| 680 | 684 | | 1789.12.27. (a) A license shall remain effective until the license is either suspended or revoked by the commissioner or surrendered by the licensee.(b) This section shall become operative on January 1, 2023. |
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| 681 | 685 | | |
|---|
| 682 | 686 | | 1789.12.27. (a) A license shall remain effective until the license is either suspended or revoked by the commissioner or surrendered by the licensee.(b) This section shall become operative on January 1, 2023. |
|---|
| 683 | 687 | | |
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| 684 | 688 | | |
|---|
| 685 | 689 | | |
|---|
| 686 | 690 | | 1789.12.27. (a) A license shall remain effective until the license is either suspended or revoked by the commissioner or surrendered by the licensee. |
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| 687 | 691 | | |
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| 688 | 692 | | (b) This section shall become operative on January 1, 2023. |
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| 689 | 693 | | |
|---|
| 690 | 694 | | SEC. 22. Section 1789.12.29 is added to the Civil Code, to read:1789.12.29. (a) The commissioner is authorized to establish relationships or contracts with the Nationwide Multistate Licensing System and Registry or other entities designated by the Nationwide Multistate Licensing System and Registry to collect and maintain records and process transaction fees or other fees related to licensees or other persons subject to this title.(b) For the purpose of participating in the Nationwide Multistate Licensing System and Registry, the commissioner is authorized to waive or modify, in whole or in part, by rule, regulation, or order, any or all of the requirements of this title and to establish new requirements as reasonably necessary to participate in the Nationwide Multistate Licensing System and Registry.(c) The commissioner may use the Nationwide Multistate Licensing System and Registry as a channeling agent for requesting information from, and distributing information to, the Department of Justice, any other governmental agency, or any other source, as directed by the commissioner.(d) The commissioner shall establish a process through which applicants and licensees may challenge information entered into the Nationwide Multistate Licensing System and Registry by the commissioner.(e) This section shall become operative on January 1, 2023. |
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| 691 | 695 | | |
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| 692 | 696 | | SEC. 22. Section 1789.12.29 is added to the Civil Code, to read: |
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| 693 | 697 | | |
|---|
| 694 | 698 | | ### SEC. 22. |
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| 695 | 699 | | |
|---|
| 696 | 700 | | 1789.12.29. (a) The commissioner is authorized to establish relationships or contracts with the Nationwide Multistate Licensing System and Registry or other entities designated by the Nationwide Multistate Licensing System and Registry to collect and maintain records and process transaction fees or other fees related to licensees or other persons subject to this title.(b) For the purpose of participating in the Nationwide Multistate Licensing System and Registry, the commissioner is authorized to waive or modify, in whole or in part, by rule, regulation, or order, any or all of the requirements of this title and to establish new requirements as reasonably necessary to participate in the Nationwide Multistate Licensing System and Registry.(c) The commissioner may use the Nationwide Multistate Licensing System and Registry as a channeling agent for requesting information from, and distributing information to, the Department of Justice, any other governmental agency, or any other source, as directed by the commissioner.(d) The commissioner shall establish a process through which applicants and licensees may challenge information entered into the Nationwide Multistate Licensing System and Registry by the commissioner.(e) This section shall become operative on January 1, 2023. |
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| 697 | 701 | | |
|---|
| 698 | 702 | | 1789.12.29. (a) The commissioner is authorized to establish relationships or contracts with the Nationwide Multistate Licensing System and Registry or other entities designated by the Nationwide Multistate Licensing System and Registry to collect and maintain records and process transaction fees or other fees related to licensees or other persons subject to this title.(b) For the purpose of participating in the Nationwide Multistate Licensing System and Registry, the commissioner is authorized to waive or modify, in whole or in part, by rule, regulation, or order, any or all of the requirements of this title and to establish new requirements as reasonably necessary to participate in the Nationwide Multistate Licensing System and Registry.(c) The commissioner may use the Nationwide Multistate Licensing System and Registry as a channeling agent for requesting information from, and distributing information to, the Department of Justice, any other governmental agency, or any other source, as directed by the commissioner.(d) The commissioner shall establish a process through which applicants and licensees may challenge information entered into the Nationwide Multistate Licensing System and Registry by the commissioner.(e) This section shall become operative on January 1, 2023. |
|---|
| 699 | 703 | | |
|---|
| 700 | 704 | | 1789.12.29. (a) The commissioner is authorized to establish relationships or contracts with the Nationwide Multistate Licensing System and Registry or other entities designated by the Nationwide Multistate Licensing System and Registry to collect and maintain records and process transaction fees or other fees related to licensees or other persons subject to this title.(b) For the purpose of participating in the Nationwide Multistate Licensing System and Registry, the commissioner is authorized to waive or modify, in whole or in part, by rule, regulation, or order, any or all of the requirements of this title and to establish new requirements as reasonably necessary to participate in the Nationwide Multistate Licensing System and Registry.(c) The commissioner may use the Nationwide Multistate Licensing System and Registry as a channeling agent for requesting information from, and distributing information to, the Department of Justice, any other governmental agency, or any other source, as directed by the commissioner.(d) The commissioner shall establish a process through which applicants and licensees may challenge information entered into the Nationwide Multistate Licensing System and Registry by the commissioner.(e) This section shall become operative on January 1, 2023. |
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| 701 | 705 | | |
|---|
| 702 | 706 | | |
|---|
| 703 | 707 | | |
|---|
| 704 | 708 | | 1789.12.29. (a) The commissioner is authorized to establish relationships or contracts with the Nationwide Multistate Licensing System and Registry or other entities designated by the Nationwide Multistate Licensing System and Registry to collect and maintain records and process transaction fees or other fees related to licensees or other persons subject to this title. |
|---|
| 705 | 709 | | |
|---|
| 706 | 710 | | (b) For the purpose of participating in the Nationwide Multistate Licensing System and Registry, the commissioner is authorized to waive or modify, in whole or in part, by rule, regulation, or order, any or all of the requirements of this title and to establish new requirements as reasonably necessary to participate in the Nationwide Multistate Licensing System and Registry. |
|---|
| 707 | 711 | | |
|---|
| 708 | 712 | | (c) The commissioner may use the Nationwide Multistate Licensing System and Registry as a channeling agent for requesting information from, and distributing information to, the Department of Justice, any other governmental agency, or any other source, as directed by the commissioner. |
|---|
| 709 | 713 | | |
|---|
| 710 | 714 | | (d) The commissioner shall establish a process through which applicants and licensees may challenge information entered into the Nationwide Multistate Licensing System and Registry by the commissioner. |
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| 711 | 715 | | |
|---|
| 712 | 716 | | (e) This section shall become operative on January 1, 2023. |
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| 713 | 717 | | |
|---|
| 714 | 718 | | SEC. 23. Section 1789.12.31 is added to the Civil Code, to read:1789.12.31. (a) Except as otherwise provided in Section 1512 of the SAFE Act (12 U.S.C. Sec. 5111(a)), the requirements under any federal law or the Information Practices Act of 1977 (Chapter 1 (commencing with Section 1798) of Part 4 of Division 3 of the Civil Code) regarding the privacy or confidentiality of any information or material provided to the Nationwide Multistate Licensing System and Registry, and any privilege arising under federal or state law, including the rules of any state court, with respect to that information or material, shall continue to apply to the information or material after the information or material has been disclosed to the Nationwide Multistate Licensing System and Registry. The information and material may be shared with all state and federal regulatory officials with industry oversight authority without the loss of privilege or the loss of confidentiality protections provided by federal law or the Information Practices Act.(b) Information or material that is subject to a privilege or confidentiality under subdivision (a) shall not be subject to any of the following:(1) Disclosure under any federal or state law governing the disclosure to the public of information held by an officer or an agency of the federal government or the state.(2) Subpoena or discovery, or admission into evidence, in any private civil action or administrative process, unless with respect to any privilege held by the Nationwide Multistate Licensing System and Registry with respect to the information or material, the person to whom the information or material pertains waives, in whole or in part, in the discretion of that person, that privilege.(c) This section shall not apply with respect to the information or material relating to the employment history of, and publicly adjudicated disciplinary and enforcement actions included in, the Nationwide Multistate Licensing System and Registry for access by the public.(d) This section shall become operative on January 1, 2023. |
|---|
| 715 | 719 | | |
|---|
| 716 | 720 | | SEC. 23. Section 1789.12.31 is added to the Civil Code, to read: |
|---|
| 717 | 721 | | |
|---|
| 718 | 722 | | ### SEC. 23. |
|---|
| 719 | 723 | | |
|---|
| 720 | 724 | | 1789.12.31. (a) Except as otherwise provided in Section 1512 of the SAFE Act (12 U.S.C. Sec. 5111(a)), the requirements under any federal law or the Information Practices Act of 1977 (Chapter 1 (commencing with Section 1798) of Part 4 of Division 3 of the Civil Code) regarding the privacy or confidentiality of any information or material provided to the Nationwide Multistate Licensing System and Registry, and any privilege arising under federal or state law, including the rules of any state court, with respect to that information or material, shall continue to apply to the information or material after the information or material has been disclosed to the Nationwide Multistate Licensing System and Registry. The information and material may be shared with all state and federal regulatory officials with industry oversight authority without the loss of privilege or the loss of confidentiality protections provided by federal law or the Information Practices Act.(b) Information or material that is subject to a privilege or confidentiality under subdivision (a) shall not be subject to any of the following:(1) Disclosure under any federal or state law governing the disclosure to the public of information held by an officer or an agency of the federal government or the state.(2) Subpoena or discovery, or admission into evidence, in any private civil action or administrative process, unless with respect to any privilege held by the Nationwide Multistate Licensing System and Registry with respect to the information or material, the person to whom the information or material pertains waives, in whole or in part, in the discretion of that person, that privilege.(c) This section shall not apply with respect to the information or material relating to the employment history of, and publicly adjudicated disciplinary and enforcement actions included in, the Nationwide Multistate Licensing System and Registry for access by the public.(d) This section shall become operative on January 1, 2023. |
|---|
| 721 | 725 | | |
|---|
| 722 | 726 | | 1789.12.31. (a) Except as otherwise provided in Section 1512 of the SAFE Act (12 U.S.C. Sec. 5111(a)), the requirements under any federal law or the Information Practices Act of 1977 (Chapter 1 (commencing with Section 1798) of Part 4 of Division 3 of the Civil Code) regarding the privacy or confidentiality of any information or material provided to the Nationwide Multistate Licensing System and Registry, and any privilege arising under federal or state law, including the rules of any state court, with respect to that information or material, shall continue to apply to the information or material after the information or material has been disclosed to the Nationwide Multistate Licensing System and Registry. The information and material may be shared with all state and federal regulatory officials with industry oversight authority without the loss of privilege or the loss of confidentiality protections provided by federal law or the Information Practices Act.(b) Information or material that is subject to a privilege or confidentiality under subdivision (a) shall not be subject to any of the following:(1) Disclosure under any federal or state law governing the disclosure to the public of information held by an officer or an agency of the federal government or the state.(2) Subpoena or discovery, or admission into evidence, in any private civil action or administrative process, unless with respect to any privilege held by the Nationwide Multistate Licensing System and Registry with respect to the information or material, the person to whom the information or material pertains waives, in whole or in part, in the discretion of that person, that privilege.(c) This section shall not apply with respect to the information or material relating to the employment history of, and publicly adjudicated disciplinary and enforcement actions included in, the Nationwide Multistate Licensing System and Registry for access by the public.(d) This section shall become operative on January 1, 2023. |
|---|
| 723 | 727 | | |
|---|
| 724 | 728 | | 1789.12.31. (a) Except as otherwise provided in Section 1512 of the SAFE Act (12 U.S.C. Sec. 5111(a)), the requirements under any federal law or the Information Practices Act of 1977 (Chapter 1 (commencing with Section 1798) of Part 4 of Division 3 of the Civil Code) regarding the privacy or confidentiality of any information or material provided to the Nationwide Multistate Licensing System and Registry, and any privilege arising under federal or state law, including the rules of any state court, with respect to that information or material, shall continue to apply to the information or material after the information or material has been disclosed to the Nationwide Multistate Licensing System and Registry. The information and material may be shared with all state and federal regulatory officials with industry oversight authority without the loss of privilege or the loss of confidentiality protections provided by federal law or the Information Practices Act.(b) Information or material that is subject to a privilege or confidentiality under subdivision (a) shall not be subject to any of the following:(1) Disclosure under any federal or state law governing the disclosure to the public of information held by an officer or an agency of the federal government or the state.(2) Subpoena or discovery, or admission into evidence, in any private civil action or administrative process, unless with respect to any privilege held by the Nationwide Multistate Licensing System and Registry with respect to the information or material, the person to whom the information or material pertains waives, in whole or in part, in the discretion of that person, that privilege.(c) This section shall not apply with respect to the information or material relating to the employment history of, and publicly adjudicated disciplinary and enforcement actions included in, the Nationwide Multistate Licensing System and Registry for access by the public.(d) This section shall become operative on January 1, 2023. |
|---|
| 725 | 729 | | |
|---|
| 726 | 730 | | |
|---|
| 727 | 731 | | |
|---|
| 728 | 732 | | 1789.12.31. (a) Except as otherwise provided in Section 1512 of the SAFE Act (12 U.S.C. Sec. 5111(a)), the requirements under any federal law or the Information Practices Act of 1977 (Chapter 1 (commencing with Section 1798) of Part 4 of Division 3 of the Civil Code) regarding the privacy or confidentiality of any information or material provided to the Nationwide Multistate Licensing System and Registry, and any privilege arising under federal or state law, including the rules of any state court, with respect to that information or material, shall continue to apply to the information or material after the information or material has been disclosed to the Nationwide Multistate Licensing System and Registry. The information and material may be shared with all state and federal regulatory officials with industry oversight authority without the loss of privilege or the loss of confidentiality protections provided by federal law or the Information Practices Act. |
|---|
| 729 | 733 | | |
|---|
| 730 | 734 | | (b) Information or material that is subject to a privilege or confidentiality under subdivision (a) shall not be subject to any of the following: |
|---|
| 731 | 735 | | |
|---|
| 732 | 736 | | (1) Disclosure under any federal or state law governing the disclosure to the public of information held by an officer or an agency of the federal government or the state. |
|---|
| 733 | 737 | | |
|---|
| 734 | 738 | | (2) Subpoena or discovery, or admission into evidence, in any private civil action or administrative process, unless with respect to any privilege held by the Nationwide Multistate Licensing System and Registry with respect to the information or material, the person to whom the information or material pertains waives, in whole or in part, in the discretion of that person, that privilege. |
|---|
| 735 | 739 | | |
|---|
| 736 | 740 | | (c) This section shall not apply with respect to the information or material relating to the employment history of, and publicly adjudicated disciplinary and enforcement actions included in, the Nationwide Multistate Licensing System and Registry for access by the public. |
|---|
| 737 | 741 | | |
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| 738 | 742 | | (d) This section shall become operative on January 1, 2023. |
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| 739 | 743 | | |
|---|
| 740 | 744 | | SEC. 24. Section 1789.12.33 is added to the Civil Code, to read:1789.12.33. (a) The commissioner shall report regularly violations of this title, as well as enforcement actions and other relevant information, to the Nationwide Multistate Licensing System and Registry, to the extent that the information is a public record.(b) This section shall become operative on January 1, 2023. |
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| 741 | 745 | | |
|---|
| 742 | 746 | | SEC. 24. Section 1789.12.33 is added to the Civil Code, to read: |
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| 743 | 747 | | |
|---|
| 744 | 748 | | ### SEC. 24. |
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| 745 | 749 | | |
|---|
| 746 | 750 | | 1789.12.33. (a) The commissioner shall report regularly violations of this title, as well as enforcement actions and other relevant information, to the Nationwide Multistate Licensing System and Registry, to the extent that the information is a public record.(b) This section shall become operative on January 1, 2023. |
|---|
| 747 | 751 | | |
|---|
| 748 | 752 | | 1789.12.33. (a) The commissioner shall report regularly violations of this title, as well as enforcement actions and other relevant information, to the Nationwide Multistate Licensing System and Registry, to the extent that the information is a public record.(b) This section shall become operative on January 1, 2023. |
|---|
| 749 | 753 | | |
|---|
| 750 | 754 | | 1789.12.33. (a) The commissioner shall report regularly violations of this title, as well as enforcement actions and other relevant information, to the Nationwide Multistate Licensing System and Registry, to the extent that the information is a public record.(b) This section shall become operative on January 1, 2023. |
|---|
| 751 | 755 | | |
|---|
| 752 | 756 | | |
|---|
| 753 | 757 | | |
|---|
| 754 | 758 | | 1789.12.33. (a) The commissioner shall report regularly violations of this title, as well as enforcement actions and other relevant information, to the Nationwide Multistate Licensing System and Registry, to the extent that the information is a public record. |
|---|
| 755 | 759 | | |
|---|
| 756 | 760 | | (b) This section shall become operative on January 1, 2023. |
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| 757 | 761 | | |
|---|
| 758 | 762 | | SEC. 25. Section 1789.12.35 is added to the Civil Code, to read:1789.12.35. (a) A licensee shall notify the commissioner, in writing, of any change in the information provided in the application for a license, as applicable, not later than 30 days after the occurrence of the event that results in the information becoming inaccurate or incomplete.(b) (1) If a licensee seeks to change its place of business to a street address other than that designated in its license, the licensee shall provide written notice to the commissioner at least 10 days prior to the change.(2) A licensee shall not engage in the business of credit services at a new location in a name other than a name approved by the commissioner.(3) A licensee that opens a new branch office or changes the location of an existing branch office shall notify the commissioner in writing of the new or changed branch office location within 30 days after the branch office begins business.(c) This section shall become operative on January 1, 2023. |
|---|
| 759 | 763 | | |
|---|
| 760 | 764 | | SEC. 25. Section 1789.12.35 is added to the Civil Code, to read: |
|---|
| 761 | 765 | | |
|---|
| 762 | 766 | | ### SEC. 25. |
|---|
| 763 | 767 | | |
|---|
| 764 | 768 | | 1789.12.35. (a) A licensee shall notify the commissioner, in writing, of any change in the information provided in the application for a license, as applicable, not later than 30 days after the occurrence of the event that results in the information becoming inaccurate or incomplete.(b) (1) If a licensee seeks to change its place of business to a street address other than that designated in its license, the licensee shall provide written notice to the commissioner at least 10 days prior to the change.(2) A licensee shall not engage in the business of credit services at a new location in a name other than a name approved by the commissioner.(3) A licensee that opens a new branch office or changes the location of an existing branch office shall notify the commissioner in writing of the new or changed branch office location within 30 days after the branch office begins business.(c) This section shall become operative on January 1, 2023. |
|---|
| 765 | 769 | | |
|---|
| 766 | 770 | | 1789.12.35. (a) A licensee shall notify the commissioner, in writing, of any change in the information provided in the application for a license, as applicable, not later than 30 days after the occurrence of the event that results in the information becoming inaccurate or incomplete.(b) (1) If a licensee seeks to change its place of business to a street address other than that designated in its license, the licensee shall provide written notice to the commissioner at least 10 days prior to the change.(2) A licensee shall not engage in the business of credit services at a new location in a name other than a name approved by the commissioner.(3) A licensee that opens a new branch office or changes the location of an existing branch office shall notify the commissioner in writing of the new or changed branch office location within 30 days after the branch office begins business.(c) This section shall become operative on January 1, 2023. |
|---|
| 767 | 771 | | |
|---|
| 768 | 772 | | 1789.12.35. (a) A licensee shall notify the commissioner, in writing, of any change in the information provided in the application for a license, as applicable, not later than 30 days after the occurrence of the event that results in the information becoming inaccurate or incomplete.(b) (1) If a licensee seeks to change its place of business to a street address other than that designated in its license, the licensee shall provide written notice to the commissioner at least 10 days prior to the change.(2) A licensee shall not engage in the business of credit services at a new location in a name other than a name approved by the commissioner.(3) A licensee that opens a new branch office or changes the location of an existing branch office shall notify the commissioner in writing of the new or changed branch office location within 30 days after the branch office begins business.(c) This section shall become operative on January 1, 2023. |
|---|
| 769 | 773 | | |
|---|
| 770 | 774 | | |
|---|
| 771 | 775 | | |
|---|
| 772 | 776 | | 1789.12.35. (a) A licensee shall notify the commissioner, in writing, of any change in the information provided in the application for a license, as applicable, not later than 30 days after the occurrence of the event that results in the information becoming inaccurate or incomplete. |
|---|
| 773 | 777 | | |
|---|
| 774 | 778 | | (b) (1) If a licensee seeks to change its place of business to a street address other than that designated in its license, the licensee shall provide written notice to the commissioner at least 10 days prior to the change. |
|---|
| 775 | 779 | | |
|---|
| 776 | 780 | | (2) A licensee shall not engage in the business of credit services at a new location in a name other than a name approved by the commissioner. |
|---|
| 777 | 781 | | |
|---|
| 778 | 782 | | (3) A licensee that opens a new branch office or changes the location of an existing branch office shall notify the commissioner in writing of the new or changed branch office location within 30 days after the branch office begins business. |
|---|
| 779 | 783 | | |
|---|
| 780 | 784 | | (c) This section shall become operative on January 1, 2023. |
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| 781 | 785 | | |
|---|
| 782 | 786 | | SEC. 26. Section 1789.12.37 is added to the Civil Code, to read:1789.12.37. A licensee shall do all of the following:(a) Develop policies and procedures reasonably intended to promote compliance with this title.(b) File with the commissioner any report required by the commissioner.(c) Comply with the provisions of this title and any regulation or order of the commissioner.(d) Submit to periodic examination by the commissioner as required by this title and any regulation or order of the commissioner.(e) Maintain a surety bond in accordance with this section in a minimum amount of twenty-five thousand dollars ($25,000). The bond shall be payable to the commissioner and issued by an insurer authorized to do business in this state. The surety bond, including any and all riders and endorsements executed subsequent to the effective date of the bond, shall be filed with the commissioner within 10 days of execution. The bond shall be used for the recovery of expenses, fines, and fees levied by the commissioner in accordance with this title. The commissioner may require licensees to submit bonds, riders, and endorsements electronically through the Nationwide Multistate Licensing System and Registrys electronic surety bond function.(1) When an action is commenced on a licensees bond, the commissioner may require the filing of a new bond. Immediately upon recovery of any action on the bond, the licensee shall file a new bond. Failure to file a new bond within 10 days of the recovery on a bond, or within 10 days after notification by the commissioner that a new bond is required, constitutes sufficient grounds for the suspension or revocation of the license. A licensee may provide the commissioner a refundable deposit in the amount of twenty-five thousand dollars ($25,000) in lieu of the bond while the licensee pursues a new bond.(2) The commissioner may require a higher bond amount for a licensee based on the number of affiliates under the license and the dollar amount of credit services performed by that licensee.(f) This section shall become operative on January 1, 2023. |
|---|
| 783 | 787 | | |
|---|
| 784 | 788 | | SEC. 26. Section 1789.12.37 is added to the Civil Code, to read: |
|---|
| 785 | 789 | | |
|---|
| 786 | 790 | | ### SEC. 26. |
|---|
| 787 | 791 | | |
|---|
| 788 | 792 | | 1789.12.37. A licensee shall do all of the following:(a) Develop policies and procedures reasonably intended to promote compliance with this title.(b) File with the commissioner any report required by the commissioner.(c) Comply with the provisions of this title and any regulation or order of the commissioner.(d) Submit to periodic examination by the commissioner as required by this title and any regulation or order of the commissioner.(e) Maintain a surety bond in accordance with this section in a minimum amount of twenty-five thousand dollars ($25,000). The bond shall be payable to the commissioner and issued by an insurer authorized to do business in this state. The surety bond, including any and all riders and endorsements executed subsequent to the effective date of the bond, shall be filed with the commissioner within 10 days of execution. The bond shall be used for the recovery of expenses, fines, and fees levied by the commissioner in accordance with this title. The commissioner may require licensees to submit bonds, riders, and endorsements electronically through the Nationwide Multistate Licensing System and Registrys electronic surety bond function.(1) When an action is commenced on a licensees bond, the commissioner may require the filing of a new bond. Immediately upon recovery of any action on the bond, the licensee shall file a new bond. Failure to file a new bond within 10 days of the recovery on a bond, or within 10 days after notification by the commissioner that a new bond is required, constitutes sufficient grounds for the suspension or revocation of the license. A licensee may provide the commissioner a refundable deposit in the amount of twenty-five thousand dollars ($25,000) in lieu of the bond while the licensee pursues a new bond.(2) The commissioner may require a higher bond amount for a licensee based on the number of affiliates under the license and the dollar amount of credit services performed by that licensee.(f) This section shall become operative on January 1, 2023. |
|---|
| 789 | 793 | | |
|---|
| 790 | 794 | | 1789.12.37. A licensee shall do all of the following:(a) Develop policies and procedures reasonably intended to promote compliance with this title.(b) File with the commissioner any report required by the commissioner.(c) Comply with the provisions of this title and any regulation or order of the commissioner.(d) Submit to periodic examination by the commissioner as required by this title and any regulation or order of the commissioner.(e) Maintain a surety bond in accordance with this section in a minimum amount of twenty-five thousand dollars ($25,000). The bond shall be payable to the commissioner and issued by an insurer authorized to do business in this state. The surety bond, including any and all riders and endorsements executed subsequent to the effective date of the bond, shall be filed with the commissioner within 10 days of execution. The bond shall be used for the recovery of expenses, fines, and fees levied by the commissioner in accordance with this title. The commissioner may require licensees to submit bonds, riders, and endorsements electronically through the Nationwide Multistate Licensing System and Registrys electronic surety bond function.(1) When an action is commenced on a licensees bond, the commissioner may require the filing of a new bond. Immediately upon recovery of any action on the bond, the licensee shall file a new bond. Failure to file a new bond within 10 days of the recovery on a bond, or within 10 days after notification by the commissioner that a new bond is required, constitutes sufficient grounds for the suspension or revocation of the license. A licensee may provide the commissioner a refundable deposit in the amount of twenty-five thousand dollars ($25,000) in lieu of the bond while the licensee pursues a new bond.(2) The commissioner may require a higher bond amount for a licensee based on the number of affiliates under the license and the dollar amount of credit services performed by that licensee.(f) This section shall become operative on January 1, 2023. |
|---|
| 791 | 795 | | |
|---|
| 792 | 796 | | 1789.12.37. A licensee shall do all of the following:(a) Develop policies and procedures reasonably intended to promote compliance with this title.(b) File with the commissioner any report required by the commissioner.(c) Comply with the provisions of this title and any regulation or order of the commissioner.(d) Submit to periodic examination by the commissioner as required by this title and any regulation or order of the commissioner.(e) Maintain a surety bond in accordance with this section in a minimum amount of twenty-five thousand dollars ($25,000). The bond shall be payable to the commissioner and issued by an insurer authorized to do business in this state. The surety bond, including any and all riders and endorsements executed subsequent to the effective date of the bond, shall be filed with the commissioner within 10 days of execution. The bond shall be used for the recovery of expenses, fines, and fees levied by the commissioner in accordance with this title. The commissioner may require licensees to submit bonds, riders, and endorsements electronically through the Nationwide Multistate Licensing System and Registrys electronic surety bond function.(1) When an action is commenced on a licensees bond, the commissioner may require the filing of a new bond. Immediately upon recovery of any action on the bond, the licensee shall file a new bond. Failure to file a new bond within 10 days of the recovery on a bond, or within 10 days after notification by the commissioner that a new bond is required, constitutes sufficient grounds for the suspension or revocation of the license. A licensee may provide the commissioner a refundable deposit in the amount of twenty-five thousand dollars ($25,000) in lieu of the bond while the licensee pursues a new bond.(2) The commissioner may require a higher bond amount for a licensee based on the number of affiliates under the license and the dollar amount of credit services performed by that licensee.(f) This section shall become operative on January 1, 2023. |
|---|
| 793 | 797 | | |
|---|
| 794 | 798 | | |
|---|
| 795 | 799 | | |
|---|
| 796 | 800 | | 1789.12.37. A licensee shall do all of the following: |
|---|
| 797 | 801 | | |
|---|
| 798 | 802 | | (a) Develop policies and procedures reasonably intended to promote compliance with this title. |
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| 799 | 803 | | |
|---|
| 800 | 804 | | (b) File with the commissioner any report required by the commissioner. |
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| 801 | 805 | | |
|---|
| 802 | 806 | | (c) Comply with the provisions of this title and any regulation or order of the commissioner. |
|---|
| 803 | 807 | | |
|---|
| 804 | 808 | | (d) Submit to periodic examination by the commissioner as required by this title and any regulation or order of the commissioner. |
|---|
| 805 | 809 | | |
|---|
| 806 | 810 | | (e) Maintain a surety bond in accordance with this section in a minimum amount of twenty-five thousand dollars ($25,000). The bond shall be payable to the commissioner and issued by an insurer authorized to do business in this state. The surety bond, including any and all riders and endorsements executed subsequent to the effective date of the bond, shall be filed with the commissioner within 10 days of execution. The bond shall be used for the recovery of expenses, fines, and fees levied by the commissioner in accordance with this title. The commissioner may require licensees to submit bonds, riders, and endorsements electronically through the Nationwide Multistate Licensing System and Registrys electronic surety bond function. |
|---|
| 807 | 811 | | |
|---|
| 808 | 812 | | (1) When an action is commenced on a licensees bond, the commissioner may require the filing of a new bond. Immediately upon recovery of any action on the bond, the licensee shall file a new bond. Failure to file a new bond within 10 days of the recovery on a bond, or within 10 days after notification by the commissioner that a new bond is required, constitutes sufficient grounds for the suspension or revocation of the license. A licensee may provide the commissioner a refundable deposit in the amount of twenty-five thousand dollars ($25,000) in lieu of the bond while the licensee pursues a new bond. |
|---|
| 809 | 813 | | |
|---|
| 810 | 814 | | (2) The commissioner may require a higher bond amount for a licensee based on the number of affiliates under the license and the dollar amount of credit services performed by that licensee. |
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| 811 | 815 | | |
|---|
| 812 | 816 | | (f) This section shall become operative on January 1, 2023. |
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| 813 | 817 | | |
|---|
| 814 | 818 | | SEC. 27. Section 1789.12.39 is added to the Civil Code, to read:1789.12.39. (a) Each licensee shall pay to the commissioner its pro rata share of all costs and expenses reasonably incurred in the administration of this title, as estimated by the commissioner, for the ensuing year and any deficit actually incurred or anticipated in the administration of the title in the year in which the annual fee is levied. The pro rata share shall be based upon the proportion of net proceeds generated by California debtor accounts in the preceding year after the amount levied pursuant to subdivision (c).(b) On or before September 30 in each year, the commissioner shall notify each licensee of the amount of the annual fee schedule that will take effect on January 1. If payment is not made by January 1, the commissioner shall assess and collect a penalty, in addition to the fee, of 1 percent of the assessment for each month or part of a month that the payment is delayed or withheld.(c) In the levying and collection of the annual fees, a licensee shall neither be charged for nor be permitted to pay less than two hundred fifty dollars ($250) nor more than an aggregate of all reasonable costs to operate this title, with the exception of fees associated with investigations and examinations.(d) If a licensee fails to pay the annual fees on or before January 1, the commissioner may by order summarily suspend or revoke the license issued to the licensee. If, after an order is made, a request for hearing is filed in writing within 30 days, and a hearing is not held within 60 days thereafter, the order is deemed rescinded as of its effective date. During any period when the license is revoked or suspended, a licensee shall not engage in the business of credit services in this state pursuant to this title except as may be permitted by order of the commissioner. However, the revocation, suspension, or surrender of a license shall not affect the powers of the commissioner as provided in this title.(e) Notwithstanding subdivisions (a) to (d), inclusive, the commissioner may by rule require licensees to pay annual fees through the Nationwide Multistate Licensing System and Registry.(f) This section shall become operative on January 1, 2023. |
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| 815 | 819 | | |
|---|
| 816 | 820 | | SEC. 27. Section 1789.12.39 is added to the Civil Code, to read: |
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| 817 | 821 | | |
|---|
| 818 | 822 | | ### SEC. 27. |
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| 819 | 823 | | |
|---|
| 820 | 824 | | 1789.12.39. (a) Each licensee shall pay to the commissioner its pro rata share of all costs and expenses reasonably incurred in the administration of this title, as estimated by the commissioner, for the ensuing year and any deficit actually incurred or anticipated in the administration of the title in the year in which the annual fee is levied. The pro rata share shall be based upon the proportion of net proceeds generated by California debtor accounts in the preceding year after the amount levied pursuant to subdivision (c).(b) On or before September 30 in each year, the commissioner shall notify each licensee of the amount of the annual fee schedule that will take effect on January 1. If payment is not made by January 1, the commissioner shall assess and collect a penalty, in addition to the fee, of 1 percent of the assessment for each month or part of a month that the payment is delayed or withheld.(c) In the levying and collection of the annual fees, a licensee shall neither be charged for nor be permitted to pay less than two hundred fifty dollars ($250) nor more than an aggregate of all reasonable costs to operate this title, with the exception of fees associated with investigations and examinations.(d) If a licensee fails to pay the annual fees on or before January 1, the commissioner may by order summarily suspend or revoke the license issued to the licensee. If, after an order is made, a request for hearing is filed in writing within 30 days, and a hearing is not held within 60 days thereafter, the order is deemed rescinded as of its effective date. During any period when the license is revoked or suspended, a licensee shall not engage in the business of credit services in this state pursuant to this title except as may be permitted by order of the commissioner. However, the revocation, suspension, or surrender of a license shall not affect the powers of the commissioner as provided in this title.(e) Notwithstanding subdivisions (a) to (d), inclusive, the commissioner may by rule require licensees to pay annual fees through the Nationwide Multistate Licensing System and Registry.(f) This section shall become operative on January 1, 2023. |
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| 821 | 825 | | |
|---|
| 822 | 826 | | 1789.12.39. (a) Each licensee shall pay to the commissioner its pro rata share of all costs and expenses reasonably incurred in the administration of this title, as estimated by the commissioner, for the ensuing year and any deficit actually incurred or anticipated in the administration of the title in the year in which the annual fee is levied. The pro rata share shall be based upon the proportion of net proceeds generated by California debtor accounts in the preceding year after the amount levied pursuant to subdivision (c).(b) On or before September 30 in each year, the commissioner shall notify each licensee of the amount of the annual fee schedule that will take effect on January 1. If payment is not made by January 1, the commissioner shall assess and collect a penalty, in addition to the fee, of 1 percent of the assessment for each month or part of a month that the payment is delayed or withheld.(c) In the levying and collection of the annual fees, a licensee shall neither be charged for nor be permitted to pay less than two hundred fifty dollars ($250) nor more than an aggregate of all reasonable costs to operate this title, with the exception of fees associated with investigations and examinations.(d) If a licensee fails to pay the annual fees on or before January 1, the commissioner may by order summarily suspend or revoke the license issued to the licensee. If, after an order is made, a request for hearing is filed in writing within 30 days, and a hearing is not held within 60 days thereafter, the order is deemed rescinded as of its effective date. During any period when the license is revoked or suspended, a licensee shall not engage in the business of credit services in this state pursuant to this title except as may be permitted by order of the commissioner. However, the revocation, suspension, or surrender of a license shall not affect the powers of the commissioner as provided in this title.(e) Notwithstanding subdivisions (a) to (d), inclusive, the commissioner may by rule require licensees to pay annual fees through the Nationwide Multistate Licensing System and Registry.(f) This section shall become operative on January 1, 2023. |
|---|
| 823 | 827 | | |
|---|
| 824 | 828 | | 1789.12.39. (a) Each licensee shall pay to the commissioner its pro rata share of all costs and expenses reasonably incurred in the administration of this title, as estimated by the commissioner, for the ensuing year and any deficit actually incurred or anticipated in the administration of the title in the year in which the annual fee is levied. The pro rata share shall be based upon the proportion of net proceeds generated by California debtor accounts in the preceding year after the amount levied pursuant to subdivision (c).(b) On or before September 30 in each year, the commissioner shall notify each licensee of the amount of the annual fee schedule that will take effect on January 1. If payment is not made by January 1, the commissioner shall assess and collect a penalty, in addition to the fee, of 1 percent of the assessment for each month or part of a month that the payment is delayed or withheld.(c) In the levying and collection of the annual fees, a licensee shall neither be charged for nor be permitted to pay less than two hundred fifty dollars ($250) nor more than an aggregate of all reasonable costs to operate this title, with the exception of fees associated with investigations and examinations.(d) If a licensee fails to pay the annual fees on or before January 1, the commissioner may by order summarily suspend or revoke the license issued to the licensee. If, after an order is made, a request for hearing is filed in writing within 30 days, and a hearing is not held within 60 days thereafter, the order is deemed rescinded as of its effective date. During any period when the license is revoked or suspended, a licensee shall not engage in the business of credit services in this state pursuant to this title except as may be permitted by order of the commissioner. However, the revocation, suspension, or surrender of a license shall not affect the powers of the commissioner as provided in this title.(e) Notwithstanding subdivisions (a) to (d), inclusive, the commissioner may by rule require licensees to pay annual fees through the Nationwide Multistate Licensing System and Registry.(f) This section shall become operative on January 1, 2023. |
|---|
| 825 | 829 | | |
|---|
| 826 | 830 | | |
|---|
| 827 | 831 | | |
|---|
| 828 | 832 | | 1789.12.39. (a) Each licensee shall pay to the commissioner its pro rata share of all costs and expenses reasonably incurred in the administration of this title, as estimated by the commissioner, for the ensuing year and any deficit actually incurred or anticipated in the administration of the title in the year in which the annual fee is levied. The pro rata share shall be based upon the proportion of net proceeds generated by California debtor accounts in the preceding year after the amount levied pursuant to subdivision (c). |
|---|
| 829 | 833 | | |
|---|
| 830 | 834 | | (b) On or before September 30 in each year, the commissioner shall notify each licensee of the amount of the annual fee schedule that will take effect on January 1. If payment is not made by January 1, the commissioner shall assess and collect a penalty, in addition to the fee, of 1 percent of the assessment for each month or part of a month that the payment is delayed or withheld. |
|---|
| 831 | 835 | | |
|---|
| 832 | 836 | | (c) In the levying and collection of the annual fees, a licensee shall neither be charged for nor be permitted to pay less than two hundred fifty dollars ($250) nor more than an aggregate of all reasonable costs to operate this title, with the exception of fees associated with investigations and examinations. |
|---|
| 833 | 837 | | |
|---|
| 834 | 838 | | (d) If a licensee fails to pay the annual fees on or before January 1, the commissioner may by order summarily suspend or revoke the license issued to the licensee. If, after an order is made, a request for hearing is filed in writing within 30 days, and a hearing is not held within 60 days thereafter, the order is deemed rescinded as of its effective date. During any period when the license is revoked or suspended, a licensee shall not engage in the business of credit services in this state pursuant to this title except as may be permitted by order of the commissioner. However, the revocation, suspension, or surrender of a license shall not affect the powers of the commissioner as provided in this title. |
|---|
| 835 | 839 | | |
|---|
| 836 | 840 | | (e) Notwithstanding subdivisions (a) to (d), inclusive, the commissioner may by rule require licensees to pay annual fees through the Nationwide Multistate Licensing System and Registry. |
|---|
| 837 | 841 | | |
|---|
| 838 | 842 | | (f) This section shall become operative on January 1, 2023. |
|---|
| 839 | 843 | | |
|---|
| 840 | 844 | | SEC. 28. Section 1789.12.41 is added to the Civil Code, to read:1789.12.41. (a) A licensee shall file an annual report with the commissioner, on or before March 15, that contains all relevant information that the commissioner reasonably requires concerning the business and operations conducted by the licensee in the state during the preceding calendar year, including information regarding credit services activity. The report shall, at minimum, require disclosure of all of the following information:(1) The total number of California consumers provided credit services in the preceding year.(2) The total dollar amount of credit services provided in the preceding year.(3) The face value dollar amount of credit services provided in the licensees portfolio in the preceding year.(4) The total dollar amount of California credit services provided in the preceding year, and the total dollar amount of outstanding debt that remains uncollected.(5) The total dollar amount of net proceeds generated by California consumers provided credit services in the preceding year.(6) The case number of any action in which the licensee was held liable by final judgment under this title.(b) The individual annual reports filed pursuant to this section shall be made available to the public for inspection.(c) The report shall be made under oath and in the form prescribed by the commissioner.(d) A licensee shall make other special reports that may be required by the commissioner.(e) This section shall become operative on January 1, 2023. |
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| 841 | 845 | | |
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| 842 | 846 | | SEC. 28. Section 1789.12.41 is added to the Civil Code, to read: |
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| 843 | 847 | | |
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| 844 | 848 | | ### SEC. 28. |
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| 845 | 849 | | |
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| 846 | 850 | | 1789.12.41. (a) A licensee shall file an annual report with the commissioner, on or before March 15, that contains all relevant information that the commissioner reasonably requires concerning the business and operations conducted by the licensee in the state during the preceding calendar year, including information regarding credit services activity. The report shall, at minimum, require disclosure of all of the following information:(1) The total number of California consumers provided credit services in the preceding year.(2) The total dollar amount of credit services provided in the preceding year.(3) The face value dollar amount of credit services provided in the licensees portfolio in the preceding year.(4) The total dollar amount of California credit services provided in the preceding year, and the total dollar amount of outstanding debt that remains uncollected.(5) The total dollar amount of net proceeds generated by California consumers provided credit services in the preceding year.(6) The case number of any action in which the licensee was held liable by final judgment under this title.(b) The individual annual reports filed pursuant to this section shall be made available to the public for inspection.(c) The report shall be made under oath and in the form prescribed by the commissioner.(d) A licensee shall make other special reports that may be required by the commissioner.(e) This section shall become operative on January 1, 2023. |
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| 847 | 851 | | |
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| 848 | 852 | | 1789.12.41. (a) A licensee shall file an annual report with the commissioner, on or before March 15, that contains all relevant information that the commissioner reasonably requires concerning the business and operations conducted by the licensee in the state during the preceding calendar year, including information regarding credit services activity. The report shall, at minimum, require disclosure of all of the following information:(1) The total number of California consumers provided credit services in the preceding year.(2) The total dollar amount of credit services provided in the preceding year.(3) The face value dollar amount of credit services provided in the licensees portfolio in the preceding year.(4) The total dollar amount of California credit services provided in the preceding year, and the total dollar amount of outstanding debt that remains uncollected.(5) The total dollar amount of net proceeds generated by California consumers provided credit services in the preceding year.(6) The case number of any action in which the licensee was held liable by final judgment under this title.(b) The individual annual reports filed pursuant to this section shall be made available to the public for inspection.(c) The report shall be made under oath and in the form prescribed by the commissioner.(d) A licensee shall make other special reports that may be required by the commissioner.(e) This section shall become operative on January 1, 2023. |
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| 849 | 853 | | |
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| 850 | 854 | | 1789.12.41. (a) A licensee shall file an annual report with the commissioner, on or before March 15, that contains all relevant information that the commissioner reasonably requires concerning the business and operations conducted by the licensee in the state during the preceding calendar year, including information regarding credit services activity. The report shall, at minimum, require disclosure of all of the following information:(1) The total number of California consumers provided credit services in the preceding year.(2) The total dollar amount of credit services provided in the preceding year.(3) The face value dollar amount of credit services provided in the licensees portfolio in the preceding year.(4) The total dollar amount of California credit services provided in the preceding year, and the total dollar amount of outstanding debt that remains uncollected.(5) The total dollar amount of net proceeds generated by California consumers provided credit services in the preceding year.(6) The case number of any action in which the licensee was held liable by final judgment under this title.(b) The individual annual reports filed pursuant to this section shall be made available to the public for inspection.(c) The report shall be made under oath and in the form prescribed by the commissioner.(d) A licensee shall make other special reports that may be required by the commissioner.(e) This section shall become operative on January 1, 2023. |
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| 851 | 855 | | |
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| 852 | 856 | | |
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| 853 | 857 | | |
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| 854 | 858 | | 1789.12.41. (a) A licensee shall file an annual report with the commissioner, on or before March 15, that contains all relevant information that the commissioner reasonably requires concerning the business and operations conducted by the licensee in the state during the preceding calendar year, including information regarding credit services activity. The report shall, at minimum, require disclosure of all of the following information: |
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| 855 | 859 | | |
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| 856 | 860 | | (1) The total number of California consumers provided credit services in the preceding year. |
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| 857 | 861 | | |
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| 858 | 862 | | (2) The total dollar amount of credit services provided in the preceding year. |
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| 859 | 863 | | |
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| 860 | 864 | | (3) The face value dollar amount of credit services provided in the licensees portfolio in the preceding year. |
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| 861 | 865 | | |
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| 862 | 866 | | (4) The total dollar amount of California credit services provided in the preceding year, and the total dollar amount of outstanding debt that remains uncollected. |
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| 863 | 867 | | |
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| 864 | 868 | | (5) The total dollar amount of net proceeds generated by California consumers provided credit services in the preceding year. |
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| 865 | 869 | | |
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| 866 | 870 | | (6) The case number of any action in which the licensee was held liable by final judgment under this title. |
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| 867 | 871 | | |
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| 868 | 872 | | (b) The individual annual reports filed pursuant to this section shall be made available to the public for inspection. |
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| 869 | 873 | | |
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| 870 | 874 | | (c) The report shall be made under oath and in the form prescribed by the commissioner. |
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| 871 | 875 | | |
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| 872 | 876 | | (d) A licensee shall make other special reports that may be required by the commissioner. |
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| 873 | 877 | | |
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| 874 | 878 | | (e) This section shall become operative on January 1, 2023. |
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| 875 | 879 | | |
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| 876 | 880 | | SEC. 29. Section 1789.12.43 is added to the Civil Code, to read:1789.12.43. (a) A licensee that ceases to engage in providing credit services shall inform the commissioner in writing and surrender the license and all other indicia of license to the commissioner.(b) This section shall become operative on January 1, 2023. |
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| 877 | 881 | | |
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| 878 | 882 | | SEC. 29. Section 1789.12.43 is added to the Civil Code, to read: |
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| 879 | 883 | | |
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| 880 | 884 | | ### SEC. 29. |
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| 881 | 885 | | |
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| 882 | 886 | | 1789.12.43. (a) A licensee that ceases to engage in providing credit services shall inform the commissioner in writing and surrender the license and all other indicia of license to the commissioner.(b) This section shall become operative on January 1, 2023. |
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| 883 | 887 | | |
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| 884 | 888 | | 1789.12.43. (a) A licensee that ceases to engage in providing credit services shall inform the commissioner in writing and surrender the license and all other indicia of license to the commissioner.(b) This section shall become operative on January 1, 2023. |
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| 885 | 889 | | |
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| 886 | 890 | | 1789.12.43. (a) A licensee that ceases to engage in providing credit services shall inform the commissioner in writing and surrender the license and all other indicia of license to the commissioner.(b) This section shall become operative on January 1, 2023. |
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| 887 | 891 | | |
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| 888 | 892 | | |
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| 889 | 893 | | |
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| 890 | 894 | | 1789.12.43. (a) A licensee that ceases to engage in providing credit services shall inform the commissioner in writing and surrender the license and all other indicia of license to the commissioner. |
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| 891 | 895 | | |
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| 892 | 896 | | (b) This section shall become operative on January 1, 2023. |
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| 893 | 897 | | |
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| 894 | 898 | | SEC. 30. Section 1789.12.45 is added to the Civil Code, to read:1789.12.45. (a) As often as the commissioner deems necessary and appropriate, the commissioner shall examine the affairs of each licensee for compliance with this title. The commissioner shall appoint suitable persons to perform the examination. The commissioner and their appointees may examine the books, records, and documents of the licensee, and may examine the licensees officers, directors, employees, or agents under oath regarding the licensees credit services.(b) The commissioner may cooperate with any agency of the state, the federal government, or other states in performing license examinations.(c) This section does not require the commissioner to conduct examinations at the business offices of licensees. Unless an onsite examination is considered necessary for the protection of the public, the commissioner may conduct some or all examinations without a site visit to the business office of a licensee, by requesting that licensees submit required books and records to the department electronically, via a secure portal.(d) Unless otherwise exempt pursuant to subparagraph (B) of paragraph (6) or subdivision (a) of Section 1789.12, affiliates of a licensee are subject to examination by the commissioner on the same terms as the licensee, but only when reports from, or examination of, a licensee provides documented evidence of unlawful activity between a licensee and affiliate benefitting, affecting, or arising from the activities regulated by this title.(e) The cost of each examination of a licensee shall be paid to the commissioner by the licensee examined, and the commissioner may maintain an action for the recovery of the cost in any court of competent jurisdiction. In determining the cost of the examination, the commissioner may use the estimated average hourly cost for all persons performing examinations of licensees or other persons subject to this title for the fiscal year.(f) The statement of the findings of an examination shall belong to the commissioner and shall not be disclosed to anyone other than the licensee, law enforcement officials, or other state or federal regulatory agencies for further investigation and enforcement. Reports required of licensees by the commissioner under this title and results of examinations performed by the commissioner under this title are the property of the commissioner.(g) The commissioner shall provide a written statement of the findings of the examination, issue a copy of that statement to the licensee and take appropriate steps to ensure correction of any violations of this title.(h) Notwithstanding any provision of this title, the commissioner shall have the authority to waive one or more branch office examinations, if the commissioner deems that the branch office examinations are not necessary for the protection of the public, due to the centralized operations of the licensee or other factors acceptable to the commissioner.(i) In any proceeding under this title, the burden of proving an exemption or an exception from a definition is upon the person claiming it.(j) This section shall become operative on January 1, 2023. |
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| 895 | 899 | | |
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| 896 | 900 | | SEC. 30. Section 1789.12.45 is added to the Civil Code, to read: |
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| 897 | 901 | | |
|---|
| 898 | 902 | | ### SEC. 30. |
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| 899 | 903 | | |
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| 900 | 904 | | 1789.12.45. (a) As often as the commissioner deems necessary and appropriate, the commissioner shall examine the affairs of each licensee for compliance with this title. The commissioner shall appoint suitable persons to perform the examination. The commissioner and their appointees may examine the books, records, and documents of the licensee, and may examine the licensees officers, directors, employees, or agents under oath regarding the licensees credit services.(b) The commissioner may cooperate with any agency of the state, the federal government, or other states in performing license examinations.(c) This section does not require the commissioner to conduct examinations at the business offices of licensees. Unless an onsite examination is considered necessary for the protection of the public, the commissioner may conduct some or all examinations without a site visit to the business office of a licensee, by requesting that licensees submit required books and records to the department electronically, via a secure portal.(d) Unless otherwise exempt pursuant to subparagraph (B) of paragraph (6) or subdivision (a) of Section 1789.12, affiliates of a licensee are subject to examination by the commissioner on the same terms as the licensee, but only when reports from, or examination of, a licensee provides documented evidence of unlawful activity between a licensee and affiliate benefitting, affecting, or arising from the activities regulated by this title.(e) The cost of each examination of a licensee shall be paid to the commissioner by the licensee examined, and the commissioner may maintain an action for the recovery of the cost in any court of competent jurisdiction. In determining the cost of the examination, the commissioner may use the estimated average hourly cost for all persons performing examinations of licensees or other persons subject to this title for the fiscal year.(f) The statement of the findings of an examination shall belong to the commissioner and shall not be disclosed to anyone other than the licensee, law enforcement officials, or other state or federal regulatory agencies for further investigation and enforcement. Reports required of licensees by the commissioner under this title and results of examinations performed by the commissioner under this title are the property of the commissioner.(g) The commissioner shall provide a written statement of the findings of the examination, issue a copy of that statement to the licensee and take appropriate steps to ensure correction of any violations of this title.(h) Notwithstanding any provision of this title, the commissioner shall have the authority to waive one or more branch office examinations, if the commissioner deems that the branch office examinations are not necessary for the protection of the public, due to the centralized operations of the licensee or other factors acceptable to the commissioner.(i) In any proceeding under this title, the burden of proving an exemption or an exception from a definition is upon the person claiming it.(j) This section shall become operative on January 1, 2023. |
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| 901 | 905 | | |
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| 902 | 906 | | 1789.12.45. (a) As often as the commissioner deems necessary and appropriate, the commissioner shall examine the affairs of each licensee for compliance with this title. The commissioner shall appoint suitable persons to perform the examination. The commissioner and their appointees may examine the books, records, and documents of the licensee, and may examine the licensees officers, directors, employees, or agents under oath regarding the licensees credit services.(b) The commissioner may cooperate with any agency of the state, the federal government, or other states in performing license examinations.(c) This section does not require the commissioner to conduct examinations at the business offices of licensees. Unless an onsite examination is considered necessary for the protection of the public, the commissioner may conduct some or all examinations without a site visit to the business office of a licensee, by requesting that licensees submit required books and records to the department electronically, via a secure portal.(d) Unless otherwise exempt pursuant to subparagraph (B) of paragraph (6) or subdivision (a) of Section 1789.12, affiliates of a licensee are subject to examination by the commissioner on the same terms as the licensee, but only when reports from, or examination of, a licensee provides documented evidence of unlawful activity between a licensee and affiliate benefitting, affecting, or arising from the activities regulated by this title.(e) The cost of each examination of a licensee shall be paid to the commissioner by the licensee examined, and the commissioner may maintain an action for the recovery of the cost in any court of competent jurisdiction. In determining the cost of the examination, the commissioner may use the estimated average hourly cost for all persons performing examinations of licensees or other persons subject to this title for the fiscal year.(f) The statement of the findings of an examination shall belong to the commissioner and shall not be disclosed to anyone other than the licensee, law enforcement officials, or other state or federal regulatory agencies for further investigation and enforcement. Reports required of licensees by the commissioner under this title and results of examinations performed by the commissioner under this title are the property of the commissioner.(g) The commissioner shall provide a written statement of the findings of the examination, issue a copy of that statement to the licensee and take appropriate steps to ensure correction of any violations of this title.(h) Notwithstanding any provision of this title, the commissioner shall have the authority to waive one or more branch office examinations, if the commissioner deems that the branch office examinations are not necessary for the protection of the public, due to the centralized operations of the licensee or other factors acceptable to the commissioner.(i) In any proceeding under this title, the burden of proving an exemption or an exception from a definition is upon the person claiming it.(j) This section shall become operative on January 1, 2023. |
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| 903 | 907 | | |
|---|
| 904 | 908 | | 1789.12.45. (a) As often as the commissioner deems necessary and appropriate, the commissioner shall examine the affairs of each licensee for compliance with this title. The commissioner shall appoint suitable persons to perform the examination. The commissioner and their appointees may examine the books, records, and documents of the licensee, and may examine the licensees officers, directors, employees, or agents under oath regarding the licensees credit services.(b) The commissioner may cooperate with any agency of the state, the federal government, or other states in performing license examinations.(c) This section does not require the commissioner to conduct examinations at the business offices of licensees. Unless an onsite examination is considered necessary for the protection of the public, the commissioner may conduct some or all examinations without a site visit to the business office of a licensee, by requesting that licensees submit required books and records to the department electronically, via a secure portal.(d) Unless otherwise exempt pursuant to subparagraph (B) of paragraph (6) or subdivision (a) of Section 1789.12, affiliates of a licensee are subject to examination by the commissioner on the same terms as the licensee, but only when reports from, or examination of, a licensee provides documented evidence of unlawful activity between a licensee and affiliate benefitting, affecting, or arising from the activities regulated by this title.(e) The cost of each examination of a licensee shall be paid to the commissioner by the licensee examined, and the commissioner may maintain an action for the recovery of the cost in any court of competent jurisdiction. In determining the cost of the examination, the commissioner may use the estimated average hourly cost for all persons performing examinations of licensees or other persons subject to this title for the fiscal year.(f) The statement of the findings of an examination shall belong to the commissioner and shall not be disclosed to anyone other than the licensee, law enforcement officials, or other state or federal regulatory agencies for further investigation and enforcement. Reports required of licensees by the commissioner under this title and results of examinations performed by the commissioner under this title are the property of the commissioner.(g) The commissioner shall provide a written statement of the findings of the examination, issue a copy of that statement to the licensee and take appropriate steps to ensure correction of any violations of this title.(h) Notwithstanding any provision of this title, the commissioner shall have the authority to waive one or more branch office examinations, if the commissioner deems that the branch office examinations are not necessary for the protection of the public, due to the centralized operations of the licensee or other factors acceptable to the commissioner.(i) In any proceeding under this title, the burden of proving an exemption or an exception from a definition is upon the person claiming it.(j) This section shall become operative on January 1, 2023. |
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| 905 | 909 | | |
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| 906 | 910 | | |
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| 907 | 911 | | |
|---|
| 908 | 912 | | 1789.12.45. (a) As often as the commissioner deems necessary and appropriate, the commissioner shall examine the affairs of each licensee for compliance with this title. The commissioner shall appoint suitable persons to perform the examination. The commissioner and their appointees may examine the books, records, and documents of the licensee, and may examine the licensees officers, directors, employees, or agents under oath regarding the licensees credit services. |
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| 909 | 913 | | |
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| 910 | 914 | | (b) The commissioner may cooperate with any agency of the state, the federal government, or other states in performing license examinations. |
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| 911 | 915 | | |
|---|
| 912 | 916 | | (c) This section does not require the commissioner to conduct examinations at the business offices of licensees. Unless an onsite examination is considered necessary for the protection of the public, the commissioner may conduct some or all examinations without a site visit to the business office of a licensee, by requesting that licensees submit required books and records to the department electronically, via a secure portal. |
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| 913 | 917 | | |
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| 914 | 918 | | (d) Unless otherwise exempt pursuant to subparagraph (B) of paragraph (6) or subdivision (a) of Section 1789.12, affiliates of a licensee are subject to examination by the commissioner on the same terms as the licensee, but only when reports from, or examination of, a licensee provides documented evidence of unlawful activity between a licensee and affiliate benefitting, affecting, or arising from the activities regulated by this title. |
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| 915 | 919 | | |
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| 916 | 920 | | (e) The cost of each examination of a licensee shall be paid to the commissioner by the licensee examined, and the commissioner may maintain an action for the recovery of the cost in any court of competent jurisdiction. In determining the cost of the examination, the commissioner may use the estimated average hourly cost for all persons performing examinations of licensees or other persons subject to this title for the fiscal year. |
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| 917 | 921 | | |
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| 918 | 922 | | (f) The statement of the findings of an examination shall belong to the commissioner and shall not be disclosed to anyone other than the licensee, law enforcement officials, or other state or federal regulatory agencies for further investigation and enforcement. Reports required of licensees by the commissioner under this title and results of examinations performed by the commissioner under this title are the property of the commissioner. |
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| 919 | 923 | | |
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| 920 | 924 | | (g) The commissioner shall provide a written statement of the findings of the examination, issue a copy of that statement to the licensee and take appropriate steps to ensure correction of any violations of this title. |
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| 921 | 925 | | |
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| 922 | 926 | | (h) Notwithstanding any provision of this title, the commissioner shall have the authority to waive one or more branch office examinations, if the commissioner deems that the branch office examinations are not necessary for the protection of the public, due to the centralized operations of the licensee or other factors acceptable to the commissioner. |
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| 923 | 927 | | |
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| 924 | 928 | | (i) In any proceeding under this title, the burden of proving an exemption or an exception from a definition is upon the person claiming it. |
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| 925 | 929 | | |
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| 926 | 930 | | (j) This section shall become operative on January 1, 2023. |
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| 927 | 931 | | |
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| 928 | 932 | | SEC. 31. Section 1789.13 of the Civil Code is amended to read:1789.13. A credit services organization and its salespersons, agents, representatives, and independent contractors who sell or attempt to sell the services of a credit services organization shall not do any of the following:(a) Charge or receive any money or other valuable consideration prior to full and complete performance of the services the credit services organization has agreed to perform for or on behalf of the buyer.(b) Fail to perform the agreed services within six months following the date the buyer signs the contract for those services.(c) Charge or receive any money or other valuable consideration for referral of the buyer to a retail seller or other credit grantor who will or may extend credit to the buyer, if either of the following apply:(1) The credit that is or will be extended to the buyer (A) is upon substantially the same terms as those available to the general public or (B) is upon substantially the same terms that would have been extended to the buyer without the assistance of the credit services organization.(2) The money or consideration is paid by the credit grantor or is derived from the buyers payments to the credit grantor for costs, fees, finance charges, or principal.(d) Make, or counsel or advise a buyer to make, a statement that is untrue or misleading and that is known, or that by the exercise of reasonable care should be known, to be untrue or misleading, to a consumer credit reporting agency or to a person who has extended credit to a buyer or to whom a buyer is applying for an extension of credit, such as statements concerning a buyers identification, home address, creditworthiness, credit standing, or credit capacity.(e) Remove, or assist or advise the buyer to remove, adverse information from the buyers credit record which is accurate and not obsolete.(f) Create, or assist or advise the buyer to create, a new credit record by using a different name, address, social security number, or employee identification number.(g) Make or use untrue or misleading representations in the offer or sale of the services of a credit services organization, including either of the following:(1) Guaranteeing or otherwise stating that the organization is able to delete an adverse credit history, unless the representation clearly discloses, in a manner equally as conspicuous as the guarantee, that this can be done only if the credit history is inaccurate or obsolete and is not claimed to be accurate by the creditor who submitted the information.(2) Guaranteeing or otherwise stating that the organization is able to obtain an extension of credit, regardless of the buyers previous credit problems or credit history, unless the representation clearly discloses, in a manner equally as conspicuous as the guarantee, the eligibility requirements for obtaining an extension of credit.(h) Engage, directly or indirectly, in an act, practice, or course of business that operates or would operate as a fraud or deception upon a person in connection with the offer or sale of the services of a credit services organization.(i) Advertise or cause to be advertised, in any manner, the services of the credit services organization, without being registered with the Department of Justice.(j) Fail to maintain an agent for service of process in this state.(k) Transfer or assign its certificate of registration.(l) Submit a buyers dispute to a consumer credit reporting agency without the buyers knowledge.(m) Use a consumer credit reporting agencys telephone system or toll-free telephone number to represent the caller as the buyer in submitting a dispute of a buyer or requesting disclosure without prior authorization of the buyer.(n) Directly or indirectly extend credit to a buyer.(o) Refer a buyer to a credit grantor that is related to the credit services organization by a common ownership, management, or control, including a common owner, director, or officer.(p) Refer a buyer to a credit grantor for which the credit services organization provides, or arranges for a third party to provide, services related to the extension of credit such as underwriting, billing, payment processing, or debt collection.(q) Provide a credit grantor with an assurance that a portion of an extension of credit to a buyer referred by the credit services organization will be repaid, including providing a guaranty, letter of credit, or agreement to acquire a part of the credit grantors financial interest in the extension of credit.(r) Use a scheme, device, or contrivance to evade the prohibitions contained in this section.(s) This section shall become inoperative on January 1, 2023, and as of that date is repealed. |
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| 929 | 933 | | |
|---|
| 930 | 934 | | SEC. 31. Section 1789.13 of the Civil Code is amended to read: |
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| 931 | 935 | | |
|---|
| 932 | 936 | | ### SEC. 31. |
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| 933 | 937 | | |
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| 934 | 938 | | 1789.13. A credit services organization and its salespersons, agents, representatives, and independent contractors who sell or attempt to sell the services of a credit services organization shall not do any of the following:(a) Charge or receive any money or other valuable consideration prior to full and complete performance of the services the credit services organization has agreed to perform for or on behalf of the buyer.(b) Fail to perform the agreed services within six months following the date the buyer signs the contract for those services.(c) Charge or receive any money or other valuable consideration for referral of the buyer to a retail seller or other credit grantor who will or may extend credit to the buyer, if either of the following apply:(1) The credit that is or will be extended to the buyer (A) is upon substantially the same terms as those available to the general public or (B) is upon substantially the same terms that would have been extended to the buyer without the assistance of the credit services organization.(2) The money or consideration is paid by the credit grantor or is derived from the buyers payments to the credit grantor for costs, fees, finance charges, or principal.(d) Make, or counsel or advise a buyer to make, a statement that is untrue or misleading and that is known, or that by the exercise of reasonable care should be known, to be untrue or misleading, to a consumer credit reporting agency or to a person who has extended credit to a buyer or to whom a buyer is applying for an extension of credit, such as statements concerning a buyers identification, home address, creditworthiness, credit standing, or credit capacity.(e) Remove, or assist or advise the buyer to remove, adverse information from the buyers credit record which is accurate and not obsolete.(f) Create, or assist or advise the buyer to create, a new credit record by using a different name, address, social security number, or employee identification number.(g) Make or use untrue or misleading representations in the offer or sale of the services of a credit services organization, including either of the following:(1) Guaranteeing or otherwise stating that the organization is able to delete an adverse credit history, unless the representation clearly discloses, in a manner equally as conspicuous as the guarantee, that this can be done only if the credit history is inaccurate or obsolete and is not claimed to be accurate by the creditor who submitted the information.(2) Guaranteeing or otherwise stating that the organization is able to obtain an extension of credit, regardless of the buyers previous credit problems or credit history, unless the representation clearly discloses, in a manner equally as conspicuous as the guarantee, the eligibility requirements for obtaining an extension of credit.(h) Engage, directly or indirectly, in an act, practice, or course of business that operates or would operate as a fraud or deception upon a person in connection with the offer or sale of the services of a credit services organization.(i) Advertise or cause to be advertised, in any manner, the services of the credit services organization, without being registered with the Department of Justice.(j) Fail to maintain an agent for service of process in this state.(k) Transfer or assign its certificate of registration.(l) Submit a buyers dispute to a consumer credit reporting agency without the buyers knowledge.(m) Use a consumer credit reporting agencys telephone system or toll-free telephone number to represent the caller as the buyer in submitting a dispute of a buyer or requesting disclosure without prior authorization of the buyer.(n) Directly or indirectly extend credit to a buyer.(o) Refer a buyer to a credit grantor that is related to the credit services organization by a common ownership, management, or control, including a common owner, director, or officer.(p) Refer a buyer to a credit grantor for which the credit services organization provides, or arranges for a third party to provide, services related to the extension of credit such as underwriting, billing, payment processing, or debt collection.(q) Provide a credit grantor with an assurance that a portion of an extension of credit to a buyer referred by the credit services organization will be repaid, including providing a guaranty, letter of credit, or agreement to acquire a part of the credit grantors financial interest in the extension of credit.(r) Use a scheme, device, or contrivance to evade the prohibitions contained in this section.(s) This section shall become inoperative on January 1, 2023, and as of that date is repealed. |
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| 935 | 939 | | |
|---|
| 936 | 940 | | 1789.13. A credit services organization and its salespersons, agents, representatives, and independent contractors who sell or attempt to sell the services of a credit services organization shall not do any of the following:(a) Charge or receive any money or other valuable consideration prior to full and complete performance of the services the credit services organization has agreed to perform for or on behalf of the buyer.(b) Fail to perform the agreed services within six months following the date the buyer signs the contract for those services.(c) Charge or receive any money or other valuable consideration for referral of the buyer to a retail seller or other credit grantor who will or may extend credit to the buyer, if either of the following apply:(1) The credit that is or will be extended to the buyer (A) is upon substantially the same terms as those available to the general public or (B) is upon substantially the same terms that would have been extended to the buyer without the assistance of the credit services organization.(2) The money or consideration is paid by the credit grantor or is derived from the buyers payments to the credit grantor for costs, fees, finance charges, or principal.(d) Make, or counsel or advise a buyer to make, a statement that is untrue or misleading and that is known, or that by the exercise of reasonable care should be known, to be untrue or misleading, to a consumer credit reporting agency or to a person who has extended credit to a buyer or to whom a buyer is applying for an extension of credit, such as statements concerning a buyers identification, home address, creditworthiness, credit standing, or credit capacity.(e) Remove, or assist or advise the buyer to remove, adverse information from the buyers credit record which is accurate and not obsolete.(f) Create, or assist or advise the buyer to create, a new credit record by using a different name, address, social security number, or employee identification number.(g) Make or use untrue or misleading representations in the offer or sale of the services of a credit services organization, including either of the following:(1) Guaranteeing or otherwise stating that the organization is able to delete an adverse credit history, unless the representation clearly discloses, in a manner equally as conspicuous as the guarantee, that this can be done only if the credit history is inaccurate or obsolete and is not claimed to be accurate by the creditor who submitted the information.(2) Guaranteeing or otherwise stating that the organization is able to obtain an extension of credit, regardless of the buyers previous credit problems or credit history, unless the representation clearly discloses, in a manner equally as conspicuous as the guarantee, the eligibility requirements for obtaining an extension of credit.(h) Engage, directly or indirectly, in an act, practice, or course of business that operates or would operate as a fraud or deception upon a person in connection with the offer or sale of the services of a credit services organization.(i) Advertise or cause to be advertised, in any manner, the services of the credit services organization, without being registered with the Department of Justice.(j) Fail to maintain an agent for service of process in this state.(k) Transfer or assign its certificate of registration.(l) Submit a buyers dispute to a consumer credit reporting agency without the buyers knowledge.(m) Use a consumer credit reporting agencys telephone system or toll-free telephone number to represent the caller as the buyer in submitting a dispute of a buyer or requesting disclosure without prior authorization of the buyer.(n) Directly or indirectly extend credit to a buyer.(o) Refer a buyer to a credit grantor that is related to the credit services organization by a common ownership, management, or control, including a common owner, director, or officer.(p) Refer a buyer to a credit grantor for which the credit services organization provides, or arranges for a third party to provide, services related to the extension of credit such as underwriting, billing, payment processing, or debt collection.(q) Provide a credit grantor with an assurance that a portion of an extension of credit to a buyer referred by the credit services organization will be repaid, including providing a guaranty, letter of credit, or agreement to acquire a part of the credit grantors financial interest in the extension of credit.(r) Use a scheme, device, or contrivance to evade the prohibitions contained in this section.(s) This section shall become inoperative on January 1, 2023, and as of that date is repealed. |
|---|
| 937 | 941 | | |
|---|
| 938 | 942 | | 1789.13. A credit services organization and its salespersons, agents, representatives, and independent contractors who sell or attempt to sell the services of a credit services organization shall not do any of the following:(a) Charge or receive any money or other valuable consideration prior to full and complete performance of the services the credit services organization has agreed to perform for or on behalf of the buyer.(b) Fail to perform the agreed services within six months following the date the buyer signs the contract for those services.(c) Charge or receive any money or other valuable consideration for referral of the buyer to a retail seller or other credit grantor who will or may extend credit to the buyer, if either of the following apply:(1) The credit that is or will be extended to the buyer (A) is upon substantially the same terms as those available to the general public or (B) is upon substantially the same terms that would have been extended to the buyer without the assistance of the credit services organization.(2) The money or consideration is paid by the credit grantor or is derived from the buyers payments to the credit grantor for costs, fees, finance charges, or principal.(d) Make, or counsel or advise a buyer to make, a statement that is untrue or misleading and that is known, or that by the exercise of reasonable care should be known, to be untrue or misleading, to a consumer credit reporting agency or to a person who has extended credit to a buyer or to whom a buyer is applying for an extension of credit, such as statements concerning a buyers identification, home address, creditworthiness, credit standing, or credit capacity.(e) Remove, or assist or advise the buyer to remove, adverse information from the buyers credit record which is accurate and not obsolete.(f) Create, or assist or advise the buyer to create, a new credit record by using a different name, address, social security number, or employee identification number.(g) Make or use untrue or misleading representations in the offer or sale of the services of a credit services organization, including either of the following:(1) Guaranteeing or otherwise stating that the organization is able to delete an adverse credit history, unless the representation clearly discloses, in a manner equally as conspicuous as the guarantee, that this can be done only if the credit history is inaccurate or obsolete and is not claimed to be accurate by the creditor who submitted the information.(2) Guaranteeing or otherwise stating that the organization is able to obtain an extension of credit, regardless of the buyers previous credit problems or credit history, unless the representation clearly discloses, in a manner equally as conspicuous as the guarantee, the eligibility requirements for obtaining an extension of credit.(h) Engage, directly or indirectly, in an act, practice, or course of business that operates or would operate as a fraud or deception upon a person in connection with the offer or sale of the services of a credit services organization.(i) Advertise or cause to be advertised, in any manner, the services of the credit services organization, without being registered with the Department of Justice.(j) Fail to maintain an agent for service of process in this state.(k) Transfer or assign its certificate of registration.(l) Submit a buyers dispute to a consumer credit reporting agency without the buyers knowledge.(m) Use a consumer credit reporting agencys telephone system or toll-free telephone number to represent the caller as the buyer in submitting a dispute of a buyer or requesting disclosure without prior authorization of the buyer.(n) Directly or indirectly extend credit to a buyer.(o) Refer a buyer to a credit grantor that is related to the credit services organization by a common ownership, management, or control, including a common owner, director, or officer.(p) Refer a buyer to a credit grantor for which the credit services organization provides, or arranges for a third party to provide, services related to the extension of credit such as underwriting, billing, payment processing, or debt collection.(q) Provide a credit grantor with an assurance that a portion of an extension of credit to a buyer referred by the credit services organization will be repaid, including providing a guaranty, letter of credit, or agreement to acquire a part of the credit grantors financial interest in the extension of credit.(r) Use a scheme, device, or contrivance to evade the prohibitions contained in this section.(s) This section shall become inoperative on January 1, 2023, and as of that date is repealed. |
|---|
| 939 | 943 | | |
|---|
| 940 | 944 | | |
|---|
| 941 | 945 | | |
|---|
| 942 | 946 | | 1789.13. A credit services organization and its salespersons, agents, representatives, and independent contractors who sell or attempt to sell the services of a credit services organization shall not do any of the following: |
|---|
| 943 | 947 | | |
|---|
| 944 | 948 | | (a) Charge or receive any money or other valuable consideration prior to full and complete performance of the services the credit services organization has agreed to perform for or on behalf of the buyer. |
|---|
| 945 | 949 | | |
|---|
| 946 | 950 | | (b) Fail to perform the agreed services within six months following the date the buyer signs the contract for those services. |
|---|
| 947 | 951 | | |
|---|
| 948 | 952 | | (c) Charge or receive any money or other valuable consideration for referral of the buyer to a retail seller or other credit grantor who will or may extend credit to the buyer, if either of the following apply: |
|---|
| 949 | 953 | | |
|---|
| 950 | 954 | | (1) The credit that is or will be extended to the buyer (A) is upon substantially the same terms as those available to the general public or (B) is upon substantially the same terms that would have been extended to the buyer without the assistance of the credit services organization. |
|---|
| 951 | 955 | | |
|---|
| 952 | 956 | | (2) The money or consideration is paid by the credit grantor or is derived from the buyers payments to the credit grantor for costs, fees, finance charges, or principal. |
|---|
| 953 | 957 | | |
|---|
| 954 | 958 | | (d) Make, or counsel or advise a buyer to make, a statement that is untrue or misleading and that is known, or that by the exercise of reasonable care should be known, to be untrue or misleading, to a consumer credit reporting agency or to a person who has extended credit to a buyer or to whom a buyer is applying for an extension of credit, such as statements concerning a buyers identification, home address, creditworthiness, credit standing, or credit capacity. |
|---|
| 955 | 959 | | |
|---|
| 956 | 960 | | (e) Remove, or assist or advise the buyer to remove, adverse information from the buyers credit record which is accurate and not obsolete. |
|---|
| 957 | 961 | | |
|---|
| 958 | 962 | | (f) Create, or assist or advise the buyer to create, a new credit record by using a different name, address, social security number, or employee identification number. |
|---|
| 959 | 963 | | |
|---|
| 960 | 964 | | (g) Make or use untrue or misleading representations in the offer or sale of the services of a credit services organization, including either of the following: |
|---|
| 961 | 965 | | |
|---|
| 962 | 966 | | (1) Guaranteeing or otherwise stating that the organization is able to delete an adverse credit history, unless the representation clearly discloses, in a manner equally as conspicuous as the guarantee, that this can be done only if the credit history is inaccurate or obsolete and is not claimed to be accurate by the creditor who submitted the information. |
|---|
| 963 | 967 | | |
|---|
| 964 | 968 | | (2) Guaranteeing or otherwise stating that the organization is able to obtain an extension of credit, regardless of the buyers previous credit problems or credit history, unless the representation clearly discloses, in a manner equally as conspicuous as the guarantee, the eligibility requirements for obtaining an extension of credit. |
|---|
| 965 | 969 | | |
|---|
| 966 | 970 | | (h) Engage, directly or indirectly, in an act, practice, or course of business that operates or would operate as a fraud or deception upon a person in connection with the offer or sale of the services of a credit services organization. |
|---|
| 967 | 971 | | |
|---|
| 968 | 972 | | (i) Advertise or cause to be advertised, in any manner, the services of the credit services organization, without being registered with the Department of Justice. |
|---|
| 969 | 973 | | |
|---|
| 970 | 974 | | (j) Fail to maintain an agent for service of process in this state. |
|---|
| 971 | 975 | | |
|---|
| 972 | 976 | | (k) Transfer or assign its certificate of registration. |
|---|
| 973 | 977 | | |
|---|
| 974 | 978 | | (l) Submit a buyers dispute to a consumer credit reporting agency without the buyers knowledge. |
|---|
| 975 | 979 | | |
|---|
| 976 | 980 | | (m) Use a consumer credit reporting agencys telephone system or toll-free telephone number to represent the caller as the buyer in submitting a dispute of a buyer or requesting disclosure without prior authorization of the buyer. |
|---|
| 977 | 981 | | |
|---|
| 978 | 982 | | (n) Directly or indirectly extend credit to a buyer. |
|---|
| 979 | 983 | | |
|---|
| 980 | 984 | | (o) Refer a buyer to a credit grantor that is related to the credit services organization by a common ownership, management, or control, including a common owner, director, or officer. |
|---|
| 981 | 985 | | |
|---|
| 982 | 986 | | (p) Refer a buyer to a credit grantor for which the credit services organization provides, or arranges for a third party to provide, services related to the extension of credit such as underwriting, billing, payment processing, or debt collection. |
|---|
| 983 | 987 | | |
|---|
| 984 | 988 | | (q) Provide a credit grantor with an assurance that a portion of an extension of credit to a buyer referred by the credit services organization will be repaid, including providing a guaranty, letter of credit, or agreement to acquire a part of the credit grantors financial interest in the extension of credit. |
|---|
| 985 | 989 | | |
|---|
| 986 | 990 | | (r) Use a scheme, device, or contrivance to evade the prohibitions contained in this section. |
|---|
| 987 | 991 | | |
|---|
| 988 | 992 | | (s) This section shall become inoperative on January 1, 2023, and as of that date is repealed. |
|---|
| 989 | 993 | | |
|---|
| 1217 | 1195 | | |
|---|
| 1218 | 1196 | | (4) A complete and accurate statement of the availability of nonprofit credit counseling services. |
|---|
| 1219 | 1197 | | |
|---|
| 1220 | 1198 | | The information statement shall be printed in at least 10-point boldface type and shall include the following statement or any substantially equivalent alternative that is approved by the Department of Justice: |
|---|
| 1221 | 1199 | | |
|---|
| 1222 | 1200 | | CONSUMER CREDIT FILE RIGHTS UNDER STATE AND FEDERAL LAW |
|---|
| 1223 | 1201 | | |
|---|
| 1224 | 1202 | | # CONSUMER CREDIT FILE RIGHTS UNDER STATE AND FEDERAL LAW |
|---|
| 1225 | 1203 | | |
|---|
| 1226 | 1204 | | You have a right to obtain a copy of your credit file from a consumer credit reporting agency. You may be charged a reasonable fee not exceeding eight dollars ($8). There is no fee, however, if you have been turned down for credit, employment, insurance, or a rental dwelling because of information in your credit report within the preceding 60 days. The consumer credit reporting agency must provide someone to help you interpret the information in your credit file. |
|---|
| 1227 | 1205 | | |
|---|
| 1228 | 1206 | | You have a right to dispute inaccurate information by contacting the consumer credit reporting agency directly. However, neither you nor any credit repair company or credit services organization has the right to have accurate, current, and verifiable information removed from your credit report. Under the Federal Fair Credit Reporting Act, the consumer credit reporting agency must remove accurate, negative information from your report only if it is over seven years old. Bankruptcy information can be reported for 10 years. |
|---|
| 1229 | 1207 | | |
|---|
| 1230 | 1208 | | If you have notified a credit reporting agency in writing that you dispute the accuracy of information in your credit file, the consumer credit reporting agency must then reinvestigate and modify or remove inaccurate information. The consumer credit reporting agency may not charge a fee for this service. Any pertinent information and copies of all documents you have concerning an error should be given to the consumer credit reporting agency. |
|---|
| 1231 | 1209 | | |
|---|
| 1232 | 1210 | | If reinvestigation does not resolve the dispute to your satisfaction, you may send a brief statement to the consumer credit reporting agency to keep in your file, explaining why you think the record is inaccurate. The consumer credit reporting agency must include your statement about disputed information in any report it issues about you. |
|---|
| 1233 | 1211 | | |
|---|
| 1234 | 1212 | | You have a right to cancel the contract for any reason within five working days from the date you signed it. If for any reason you do cancel the contract during this time, you do not owe any money. |
|---|
| 1235 | 1213 | | |
|---|
| 1236 | 1214 | | You have a right to sue a credit services organization if it misleads you. |
|---|
| 1237 | 1215 | | |
|---|
| 1238 | 1216 | | (b) This section shall become inoperative on January 1, 2023, and as of that date is repealed. |
|---|
| 1239 | 1217 | | |
|---|
| 1240 | 1218 | | SEC. 38. Section 1789.15 is added to the Civil Code, to read:1789.15. (a) The information statement shall include all of the following:(1) A complete and detailed description of the services to be performed by the credit services organization for or on behalf of the consumer and the total amount the consumer will have to pay, or become obligated to pay, for the services.(2) The consumers right to proceed against the bond under the circumstances and in the manner set forth in Section 1789.18.(3) The name and address of the surety company which issued the bond.(4) A complete and accurate statement of the availability of nonprofit credit counseling services.(5) The following notice: If you have a complaint about the services provided by this credit services organization or the fees charged by this credit services organization, you may submit that complaint to the Department of Financial Protection and Innovation at www.dfpi.ca.gov, or the Attorney Generals office, California Department of Justice, Attn: ____, P.O. Box 944255, Sacramento, CA 94244-2550.The information statement shall be printed in at least 10-point boldface type and shall include the following statement:CONSUMER CREDIT FILE RIGHTS UNDER STATE AND FEDERAL LAWYou have a right to obtain a free copy of your credit report from a credit reporting agency. You may obtain this free copy of your credit report one time per year by visiting www.AnnualCreditReport.com. You will be able to view your credit report, dispute alleged inaccuracies, and obtain additional information at no fee. If requested, the consumer credit reporting agency must provide someone to help you interpret the information in your credit file.You have a right to dispute inaccurate information by contacting the consumer credit reporting agency directly. However, neither you nor any credit repair company or credit services organization has the right to have accurate, current, and verifiable information removed from your credit report. Under the Federal Fair Credit Reporting Act, the consumer credit reporting agency must remove accurate, negative information from your report only if it is over seven years old. Bankruptcy information can be reported for 10 years.If you have notified a credit reporting agency in writing that you dispute the accuracy of information in your credit file, the consumer credit reporting agency must then reinvestigate and modify or remove inaccurate information. The consumer credit reporting agency may not charge a fee for this service. Any pertinent information and copies of all documents you have concerning an error should be given to the consumer credit reporting agency.If the reinvestigation does not resolve the dispute to your satisfaction, you may send a brief statement to the consumer credit reporting agency to keep in your file, explaining why you think the record is inaccurate. The consumer credit reporting agency must include your statement about disputed information in any report it issues about you.You have a right to cancel the contract with the credit services organization for any reason before midnight on the fifth working day after you signed it. If for any reason you cancel the contract during this time, you do not owe any money.You have a right to sue a credit services organization if it misleads you.(b) This section shall become operative on January 1, 2023. |
|---|
| 1241 | 1219 | | |
|---|
| 1242 | 1220 | | SEC. 38. Section 1789.15 is added to the Civil Code, to read: |
|---|
| 1243 | 1221 | | |
|---|
| 1244 | 1222 | | ### SEC. 38. |
|---|
| 1245 | 1223 | | |
|---|
| 1246 | 1224 | | 1789.15. (a) The information statement shall include all of the following:(1) A complete and detailed description of the services to be performed by the credit services organization for or on behalf of the consumer and the total amount the consumer will have to pay, or become obligated to pay, for the services.(2) The consumers right to proceed against the bond under the circumstances and in the manner set forth in Section 1789.18.(3) The name and address of the surety company which issued the bond.(4) A complete and accurate statement of the availability of nonprofit credit counseling services.(5) The following notice: If you have a complaint about the services provided by this credit services organization or the fees charged by this credit services organization, you may submit that complaint to the Department of Financial Protection and Innovation at www.dfpi.ca.gov, or the Attorney Generals office, California Department of Justice, Attn: ____, P.O. Box 944255, Sacramento, CA 94244-2550.The information statement shall be printed in at least 10-point boldface type and shall include the following statement:CONSUMER CREDIT FILE RIGHTS UNDER STATE AND FEDERAL LAWYou have a right to obtain a free copy of your credit report from a credit reporting agency. You may obtain this free copy of your credit report one time per year by visiting www.AnnualCreditReport.com. You will be able to view your credit report, dispute alleged inaccuracies, and obtain additional information at no fee. If requested, the consumer credit reporting agency must provide someone to help you interpret the information in your credit file.You have a right to dispute inaccurate information by contacting the consumer credit reporting agency directly. However, neither you nor any credit repair company or credit services organization has the right to have accurate, current, and verifiable information removed from your credit report. Under the Federal Fair Credit Reporting Act, the consumer credit reporting agency must remove accurate, negative information from your report only if it is over seven years old. Bankruptcy information can be reported for 10 years.If you have notified a credit reporting agency in writing that you dispute the accuracy of information in your credit file, the consumer credit reporting agency must then reinvestigate and modify or remove inaccurate information. The consumer credit reporting agency may not charge a fee for this service. Any pertinent information and copies of all documents you have concerning an error should be given to the consumer credit reporting agency.If the reinvestigation does not resolve the dispute to your satisfaction, you may send a brief statement to the consumer credit reporting agency to keep in your file, explaining why you think the record is inaccurate. The consumer credit reporting agency must include your statement about disputed information in any report it issues about you.You have a right to cancel the contract with the credit services organization for any reason before midnight on the fifth working day after you signed it. If for any reason you cancel the contract during this time, you do not owe any money.You have a right to sue a credit services organization if it misleads you.(b) This section shall become operative on January 1, 2023. |
|---|
| 1247 | 1225 | | |
|---|
| 1248 | 1226 | | 1789.15. (a) The information statement shall include all of the following:(1) A complete and detailed description of the services to be performed by the credit services organization for or on behalf of the consumer and the total amount the consumer will have to pay, or become obligated to pay, for the services.(2) The consumers right to proceed against the bond under the circumstances and in the manner set forth in Section 1789.18.(3) The name and address of the surety company which issued the bond.(4) A complete and accurate statement of the availability of nonprofit credit counseling services.(5) The following notice: If you have a complaint about the services provided by this credit services organization or the fees charged by this credit services organization, you may submit that complaint to the Department of Financial Protection and Innovation at www.dfpi.ca.gov, or the Attorney Generals office, California Department of Justice, Attn: ____, P.O. Box 944255, Sacramento, CA 94244-2550.The information statement shall be printed in at least 10-point boldface type and shall include the following statement:CONSUMER CREDIT FILE RIGHTS UNDER STATE AND FEDERAL LAWYou have a right to obtain a free copy of your credit report from a credit reporting agency. You may obtain this free copy of your credit report one time per year by visiting www.AnnualCreditReport.com. You will be able to view your credit report, dispute alleged inaccuracies, and obtain additional information at no fee. If requested, the consumer credit reporting agency must provide someone to help you interpret the information in your credit file.You have a right to dispute inaccurate information by contacting the consumer credit reporting agency directly. However, neither you nor any credit repair company or credit services organization has the right to have accurate, current, and verifiable information removed from your credit report. Under the Federal Fair Credit Reporting Act, the consumer credit reporting agency must remove accurate, negative information from your report only if it is over seven years old. Bankruptcy information can be reported for 10 years.If you have notified a credit reporting agency in writing that you dispute the accuracy of information in your credit file, the consumer credit reporting agency must then reinvestigate and modify or remove inaccurate information. The consumer credit reporting agency may not charge a fee for this service. Any pertinent information and copies of all documents you have concerning an error should be given to the consumer credit reporting agency.If the reinvestigation does not resolve the dispute to your satisfaction, you may send a brief statement to the consumer credit reporting agency to keep in your file, explaining why you think the record is inaccurate. The consumer credit reporting agency must include your statement about disputed information in any report it issues about you.You have a right to cancel the contract with the credit services organization for any reason before midnight on the fifth working day after you signed it. If for any reason you cancel the contract during this time, you do not owe any money.You have a right to sue a credit services organization if it misleads you.(b) This section shall become operative on January 1, 2023. |
|---|
| 1249 | 1227 | | |
|---|
| 1250 | 1228 | | 1789.15. (a) The information statement shall include all of the following:(1) A complete and detailed description of the services to be performed by the credit services organization for or on behalf of the consumer and the total amount the consumer will have to pay, or become obligated to pay, for the services.(2) The consumers right to proceed against the bond under the circumstances and in the manner set forth in Section 1789.18.(3) The name and address of the surety company which issued the bond.(4) A complete and accurate statement of the availability of nonprofit credit counseling services.(5) The following notice: If you have a complaint about the services provided by this credit services organization or the fees charged by this credit services organization, you may submit that complaint to the Department of Financial Protection and Innovation at www.dfpi.ca.gov, or the Attorney Generals office, California Department of Justice, Attn: ____, P.O. Box 944255, Sacramento, CA 94244-2550.The information statement shall be printed in at least 10-point boldface type and shall include the following statement:CONSUMER CREDIT FILE RIGHTS UNDER STATE AND FEDERAL LAWYou have a right to obtain a free copy of your credit report from a credit reporting agency. You may obtain this free copy of your credit report one time per year by visiting www.AnnualCreditReport.com. You will be able to view your credit report, dispute alleged inaccuracies, and obtain additional information at no fee. If requested, the consumer credit reporting agency must provide someone to help you interpret the information in your credit file.You have a right to dispute inaccurate information by contacting the consumer credit reporting agency directly. However, neither you nor any credit repair company or credit services organization has the right to have accurate, current, and verifiable information removed from your credit report. Under the Federal Fair Credit Reporting Act, the consumer credit reporting agency must remove accurate, negative information from your report only if it is over seven years old. Bankruptcy information can be reported for 10 years.If you have notified a credit reporting agency in writing that you dispute the accuracy of information in your credit file, the consumer credit reporting agency must then reinvestigate and modify or remove inaccurate information. The consumer credit reporting agency may not charge a fee for this service. Any pertinent information and copies of all documents you have concerning an error should be given to the consumer credit reporting agency.If the reinvestigation does not resolve the dispute to your satisfaction, you may send a brief statement to the consumer credit reporting agency to keep in your file, explaining why you think the record is inaccurate. The consumer credit reporting agency must include your statement about disputed information in any report it issues about you.You have a right to cancel the contract with the credit services organization for any reason before midnight on the fifth working day after you signed it. If for any reason you cancel the contract during this time, you do not owe any money.You have a right to sue a credit services organization if it misleads you.(b) This section shall become operative on January 1, 2023. |
|---|
| 1251 | 1229 | | |
|---|
| 1252 | 1230 | | |
|---|
| 1253 | 1231 | | |
|---|
| 1254 | 1232 | | 1789.15. (a) The information statement shall include all of the following: |
|---|
| 1255 | 1233 | | |
|---|
| 1256 | 1234 | | (1) A complete and detailed description of the services to be performed by the credit services organization for or on behalf of the consumer and the total amount the consumer will have to pay, or become obligated to pay, for the services. |
|---|
| 1257 | 1235 | | |
|---|
| 1258 | 1236 | | (2) The consumers right to proceed against the bond under the circumstances and in the manner set forth in Section 1789.18. |
|---|
| 1259 | 1237 | | |
|---|
| 1260 | 1238 | | (3) The name and address of the surety company which issued the bond. |
|---|
| 1261 | 1239 | | |
|---|
| 1262 | 1240 | | (4) A complete and accurate statement of the availability of nonprofit credit counseling services. |
|---|
| 1263 | 1241 | | |
|---|
| 1264 | 1242 | | (5) The following notice: If you have a complaint about the services provided by this credit services organization or the fees charged by this credit services organization, you may submit that complaint to the Department of Financial Protection and Innovation at www.dfpi.ca.gov, or the Attorney Generals office, California Department of Justice, Attn: ____, P.O. Box 944255, Sacramento, CA 94244-2550. |
|---|
| 1265 | 1243 | | |
|---|
| 1266 | 1244 | | The information statement shall be printed in at least 10-point boldface type and shall include the following statement: |
|---|
| 1267 | 1245 | | |
|---|
| 1268 | 1246 | | CONSUMER CREDIT FILE RIGHTS UNDER STATE AND FEDERAL LAW |
|---|
| 1269 | 1247 | | |
|---|
| 1270 | 1248 | | # CONSUMER CREDIT FILE RIGHTS UNDER STATE AND FEDERAL LAW |
|---|
| 1271 | 1249 | | |
|---|
| 1272 | 1250 | | You have a right to obtain a free copy of your credit report from a credit reporting agency. You may obtain this free copy of your credit report one time per year by visiting www.AnnualCreditReport.com. You will be able to view your credit report, dispute alleged inaccuracies, and obtain additional information at no fee. If requested, the consumer credit reporting agency must provide someone to help you interpret the information in your credit file. |
|---|
| 1273 | 1251 | | |
|---|
| 1274 | 1252 | | You have a right to dispute inaccurate information by contacting the consumer credit reporting agency directly. However, neither you nor any credit repair company or credit services organization has the right to have accurate, current, and verifiable information removed from your credit report. Under the Federal Fair Credit Reporting Act, the consumer credit reporting agency must remove accurate, negative information from your report only if it is over seven years old. Bankruptcy information can be reported for 10 years. |
|---|
| 1275 | 1253 | | |
|---|
| 1276 | 1254 | | If you have notified a credit reporting agency in writing that you dispute the accuracy of information in your credit file, the consumer credit reporting agency must then reinvestigate and modify or remove inaccurate information. The consumer credit reporting agency may not charge a fee for this service. Any pertinent information and copies of all documents you have concerning an error should be given to the consumer credit reporting agency. |
|---|
| 1277 | 1255 | | |
|---|
| 1278 | 1256 | | If the reinvestigation does not resolve the dispute to your satisfaction, you may send a brief statement to the consumer credit reporting agency to keep in your file, explaining why you think the record is inaccurate. The consumer credit reporting agency must include your statement about disputed information in any report it issues about you. |
|---|
| 1279 | 1257 | | |
|---|
| 1280 | 1258 | | You have a right to cancel the contract with the credit services organization for any reason before midnight on the fifth working day after you signed it. If for any reason you cancel the contract during this time, you do not owe any money. |
|---|
| 1281 | 1259 | | |
|---|
| 1282 | 1260 | | You have a right to sue a credit services organization if it misleads you. |
|---|
| 1283 | 1261 | | |
|---|
| 1284 | 1262 | | (b) This section shall become operative on January 1, 2023. |
|---|
| 1285 | 1263 | | |
|---|
| 1286 | 1264 | | SEC. 39. Section 1789.16 of the Civil Code is amended to read:1789.16. (a) A credit services organization shall not provide any service to a buyer except pursuant to a written contract that complies with this section. Every contract between the buyer and a credit services organization for the purchase of the services of the credit services organization shall be in writing, shall be dated, signed by the buyer, and include all of the following:(1) A conspicuous statement in size equal to at least 10-point boldface type, in immediate proximity to the space reserved for the signature of the buyer, as follows:You, the buyer, may cancel this contract at any time prior to midnight of the fifth day after the date of the transaction. See the attached notice of cancellation form for an explanation of this right.(2) The terms and conditions of payment, including the total of all payments to be made by the buyer, whether to the credit services organization or to some other person.(3) A full and detailed description of the services to be performed by the credit services organization for the buyer, including all guarantees and all promises of full or partial refunds, and the estimated date by which the services are to be performed, or the estimated length of time for performing the services not to exceed six months or a shorter period consistent with the purposes of this title as may be prescribed by the Department of Justice.(4) The credit services organizations principal business address and the name and address of its agent, other than the Secretary of State, in the State of California, authorized to receive service of process.(b) The contract shall be accompanied by a completed form in duplicate, captioned Notice of Cancellation, which shall be attached to the contract and easily detachable, and which shall contain in type of at least 10-point the following statement written in the same language as used in the contract:Notice of CancellationYou may cancel this contract, without any penalty or obligation, within five days from the date the contract is signed.If you cancel, any payment made by you under this contract must be returned within 15 days following receipt by the seller of your cancellation notice.To cancel this contract, mail or deliver a signed and dated copy of this cancellation notice, or any other written notice, to _____ (name of seller) _____ at _____ (address of seller)(place of business) _____ not later than midnight (date).I hereby cancel this transaction.(date) _____ (purchasers signature) _____ A copy of the fully completed contract and all other documents the credit services organization requires the buyer to sign shall be given to the buyer at the time they are signed.(c) This section shall become inoperative on January 1, 2023, and as of that date is repealed. |
|---|
| 1287 | 1265 | | |
|---|
| 1288 | 1266 | | SEC. 39. Section 1789.16 of the Civil Code is amended to read: |
|---|
| 1289 | 1267 | | |
|---|
| 1290 | 1268 | | ### SEC. 39. |
|---|
| 1291 | 1269 | | |
|---|
| 1292 | 1270 | | 1789.16. (a) A credit services organization shall not provide any service to a buyer except pursuant to a written contract that complies with this section. Every contract between the buyer and a credit services organization for the purchase of the services of the credit services organization shall be in writing, shall be dated, signed by the buyer, and include all of the following:(1) A conspicuous statement in size equal to at least 10-point boldface type, in immediate proximity to the space reserved for the signature of the buyer, as follows:You, the buyer, may cancel this contract at any time prior to midnight of the fifth day after the date of the transaction. See the attached notice of cancellation form for an explanation of this right.(2) The terms and conditions of payment, including the total of all payments to be made by the buyer, whether to the credit services organization or to some other person.(3) A full and detailed description of the services to be performed by the credit services organization for the buyer, including all guarantees and all promises of full or partial refunds, and the estimated date by which the services are to be performed, or the estimated length of time for performing the services not to exceed six months or a shorter period consistent with the purposes of this title as may be prescribed by the Department of Justice.(4) The credit services organizations principal business address and the name and address of its agent, other than the Secretary of State, in the State of California, authorized to receive service of process.(b) The contract shall be accompanied by a completed form in duplicate, captioned Notice of Cancellation, which shall be attached to the contract and easily detachable, and which shall contain in type of at least 10-point the following statement written in the same language as used in the contract:Notice of CancellationYou may cancel this contract, without any penalty or obligation, within five days from the date the contract is signed.If you cancel, any payment made by you under this contract must be returned within 15 days following receipt by the seller of your cancellation notice.To cancel this contract, mail or deliver a signed and dated copy of this cancellation notice, or any other written notice, to _____ (name of seller) _____ at _____ (address of seller)(place of business) _____ not later than midnight (date).I hereby cancel this transaction.(date) _____ (purchasers signature) _____ A copy of the fully completed contract and all other documents the credit services organization requires the buyer to sign shall be given to the buyer at the time they are signed.(c) This section shall become inoperative on January 1, 2023, and as of that date is repealed. |
|---|
| 1293 | 1271 | | |
|---|
| 1294 | 1272 | | 1789.16. (a) A credit services organization shall not provide any service to a buyer except pursuant to a written contract that complies with this section. Every contract between the buyer and a credit services organization for the purchase of the services of the credit services organization shall be in writing, shall be dated, signed by the buyer, and include all of the following:(1) A conspicuous statement in size equal to at least 10-point boldface type, in immediate proximity to the space reserved for the signature of the buyer, as follows:You, the buyer, may cancel this contract at any time prior to midnight of the fifth day after the date of the transaction. See the attached notice of cancellation form for an explanation of this right.(2) The terms and conditions of payment, including the total of all payments to be made by the buyer, whether to the credit services organization or to some other person.(3) A full and detailed description of the services to be performed by the credit services organization for the buyer, including all guarantees and all promises of full or partial refunds, and the estimated date by which the services are to be performed, or the estimated length of time for performing the services not to exceed six months or a shorter period consistent with the purposes of this title as may be prescribed by the Department of Justice.(4) The credit services organizations principal business address and the name and address of its agent, other than the Secretary of State, in the State of California, authorized to receive service of process.(b) The contract shall be accompanied by a completed form in duplicate, captioned Notice of Cancellation, which shall be attached to the contract and easily detachable, and which shall contain in type of at least 10-point the following statement written in the same language as used in the contract:Notice of CancellationYou may cancel this contract, without any penalty or obligation, within five days from the date the contract is signed.If you cancel, any payment made by you under this contract must be returned within 15 days following receipt by the seller of your cancellation notice.To cancel this contract, mail or deliver a signed and dated copy of this cancellation notice, or any other written notice, to _____ (name of seller) _____ at _____ (address of seller)(place of business) _____ not later than midnight (date).I hereby cancel this transaction.(date) _____ (purchasers signature) _____ A copy of the fully completed contract and all other documents the credit services organization requires the buyer to sign shall be given to the buyer at the time they are signed.(c) This section shall become inoperative on January 1, 2023, and as of that date is repealed. |
|---|
| 1295 | 1273 | | |
|---|
| 1296 | 1274 | | 1789.16. (a) A credit services organization shall not provide any service to a buyer except pursuant to a written contract that complies with this section. Every contract between the buyer and a credit services organization for the purchase of the services of the credit services organization shall be in writing, shall be dated, signed by the buyer, and include all of the following:(1) A conspicuous statement in size equal to at least 10-point boldface type, in immediate proximity to the space reserved for the signature of the buyer, as follows:You, the buyer, may cancel this contract at any time prior to midnight of the fifth day after the date of the transaction. See the attached notice of cancellation form for an explanation of this right.(2) The terms and conditions of payment, including the total of all payments to be made by the buyer, whether to the credit services organization or to some other person.(3) A full and detailed description of the services to be performed by the credit services organization for the buyer, including all guarantees and all promises of full or partial refunds, and the estimated date by which the services are to be performed, or the estimated length of time for performing the services not to exceed six months or a shorter period consistent with the purposes of this title as may be prescribed by the Department of Justice.(4) The credit services organizations principal business address and the name and address of its agent, other than the Secretary of State, in the State of California, authorized to receive service of process.(b) The contract shall be accompanied by a completed form in duplicate, captioned Notice of Cancellation, which shall be attached to the contract and easily detachable, and which shall contain in type of at least 10-point the following statement written in the same language as used in the contract:Notice of CancellationYou may cancel this contract, without any penalty or obligation, within five days from the date the contract is signed.If you cancel, any payment made by you under this contract must be returned within 15 days following receipt by the seller of your cancellation notice.To cancel this contract, mail or deliver a signed and dated copy of this cancellation notice, or any other written notice, to _____ (name of seller) _____ at _____ (address of seller)(place of business) _____ not later than midnight (date).I hereby cancel this transaction.(date) _____ (purchasers signature) _____ A copy of the fully completed contract and all other documents the credit services organization requires the buyer to sign shall be given to the buyer at the time they are signed.(c) This section shall become inoperative on January 1, 2023, and as of that date is repealed. |
|---|
| 1297 | 1275 | | |
|---|
| 1298 | 1276 | | |
|---|
| 1299 | 1277 | | |
|---|
| 1300 | 1278 | | 1789.16. (a) A credit services organization shall not provide any service to a buyer except pursuant to a written contract that complies with this section. Every contract between the buyer and a credit services organization for the purchase of the services of the credit services organization shall be in writing, shall be dated, signed by the buyer, and include all of the following: |
|---|
| 1301 | 1279 | | |
|---|
| 1302 | 1280 | | (1) A conspicuous statement in size equal to at least 10-point boldface type, in immediate proximity to the space reserved for the signature of the buyer, as follows: |
|---|
| 1303 | 1281 | | |
|---|
| 1304 | 1282 | | You, the buyer, may cancel this contract at any time prior to midnight of the fifth day after the date of the transaction. See the attached notice of cancellation form for an explanation of this right. |
|---|
| 1305 | 1283 | | |
|---|
| 1306 | 1284 | | (2) The terms and conditions of payment, including the total of all payments to be made by the buyer, whether to the credit services organization or to some other person. |
|---|
| 1307 | 1285 | | |
|---|
| 1308 | 1286 | | (3) A full and detailed description of the services to be performed by the credit services organization for the buyer, including all guarantees and all promises of full or partial refunds, and the estimated date by which the services are to be performed, or the estimated length of time for performing the services not to exceed six months or a shorter period consistent with the purposes of this title as may be prescribed by the Department of Justice. |
|---|
| 1309 | 1287 | | |
|---|
| 1310 | 1288 | | (4) The credit services organizations principal business address and the name and address of its agent, other than the Secretary of State, in the State of California, authorized to receive service of process. |
|---|
| 1311 | 1289 | | |
|---|
| 1312 | 1290 | | (b) The contract shall be accompanied by a completed form in duplicate, captioned Notice of Cancellation, which shall be attached to the contract and easily detachable, and which shall contain in type of at least 10-point the following statement written in the same language as used in the contract: |
|---|
| 1313 | 1291 | | |
|---|
| 1314 | 1292 | | Notice of Cancellation |
|---|
| 1315 | 1293 | | |
|---|
| 1316 | 1294 | | # Notice of Cancellation |
|---|
| 1317 | 1295 | | |
|---|
| 1318 | 1296 | | You may cancel this contract, without any penalty or obligation, within five days from the date the contract is signed. |
|---|
| 1319 | 1297 | | |
|---|
| 1320 | 1298 | | If you cancel, any payment made by you under this contract must be returned within 15 days following receipt by the seller of your cancellation notice. |
|---|
| 1321 | 1299 | | |
|---|
| 1322 | 1300 | | To cancel this contract, mail or deliver a signed and dated copy of this cancellation notice, or any other written notice, to |
|---|
| 1323 | 1301 | | _____ (name of seller) _____ at |
|---|
| 1324 | 1302 | | _____ (address of seller)(place of business) _____ |
|---|
| 1325 | 1303 | | not later than midnight (date). |
|---|
| 1326 | 1304 | | I hereby cancel this transaction. |
|---|
| 1327 | 1305 | | (date) _____ (purchasers signature) _____ |
|---|
| 1328 | 1306 | | |
|---|
| 1329 | 1307 | | To cancel this contract, mail or deliver a signed and dated copy of this cancellation notice, or any other written notice, to |
|---|
| 1330 | 1308 | | |
|---|
| 1331 | 1309 | | _____ (name of seller) _____ at |
|---|
| 1332 | 1310 | | |
|---|
| 1333 | 1311 | | _____ (address of seller)(place of business) _____ |
|---|
| 1334 | 1312 | | |
|---|
| 1335 | 1313 | | not later than midnight (date). |
|---|
| 1336 | 1314 | | |
|---|
| 1337 | 1315 | | I hereby cancel this transaction. |
|---|
| 1338 | 1316 | | |
|---|
| 1339 | 1317 | | (date) _____ (purchasers signature) _____ |
|---|
| 1340 | 1318 | | |
|---|
| 1341 | 1319 | | A copy of the fully completed contract and all other documents the credit services organization requires the buyer to sign shall be given to the buyer at the time they are signed. |
|---|
| 1342 | 1320 | | |
|---|
| 1343 | 1321 | | (c) This section shall become inoperative on January 1, 2023, and as of that date is repealed. |
|---|
| 1344 | 1322 | | |
|---|
| 1345 | 1323 | | SEC. 40. Section 1789.16 is added to the Civil Code, to read:1789.16. (a) A credit services organization shall not provide any service to a consumer except pursuant to a written contract that complies with this section. Every contract between the consumer and a credit services organization for the purchase of the services of the credit services organization shall identify the physical address, electronic mail address, and facsimile number if applicable, of the credit services organization, shall be in writing, shall be dated, shall be signed by the consumer, and shall include all of the following:(1) A conspicuous statement in size equal to at least 10-point boldface type, in immediate proximity to the space reserved for the signature of the buyer, as follows:You, the consumer, may cancel this contract at any time before midnight on the fifth working day after you sign it. See the attached notice of cancellation form for an explanation of this right.(2) The terms and conditions of payment, including the total of all payments to be made by the consumer, whether to the credit services organization or to some other person.(3) A full and detailed description of the services to be performed by the credit services organization for the consumer, including a list of the inaccurate or obsolete adverse information appearing on the consumers credit report which the credit services organization will seek to delete or modify, the basis for the deletion or modification, and, if applicable, a description of each modification sought and the anticipated payment required by the consumer to achieve each account deletion or modification, all guarantees and all promises of full or partial refunds, and the estimated date by which the services are to be performed, or the estimated length of time for performing the services, not to exceed 180 days, or a shorter period consistent with the purposes of this title as may be prescribed by the Department of Financial Protection and Innovation.(4) The credit services organizations principal business address and the name and address of its agent, other than the Secretary of State, in the State of California, authorized to receive service of process.(b) The contract shall be accompanied by a completed form in duplicate, captioned Notice of Cancellation, which shall be attached to the contract and easily detachable, and which shall contain in type of at least 10-point the following statement written in the same language as used in the contract:Notice of CancellationYou may cancel this contract, without any penalty or obligation, before midnight on the fifth working day after you sign it.If you cancel, any payment made by you under this contract must be returned within 15 days following receipt by the seller of your cancellation notice.To cancel this contract, mail or deliver a signed and dated copy of this cancellation notice, or any other written notice, to _____ (name of seller) _____ at _____ (address of seller)(place of business) _____ not later than midnight (date).I hereby cancel this transaction.(date) _____ (purchasers signature) _____ A copy of the fully completed contract and all other documents the credit services organization requires the buyer to sign shall be given to the consumer at the time they are signed.(c) This section shall become operative on January 1, 2023. |
|---|
| 1346 | 1324 | | |
|---|
| 1347 | 1325 | | SEC. 40. Section 1789.16 is added to the Civil Code, to read: |
|---|
| 1348 | 1326 | | |
|---|
| 1349 | 1327 | | ### SEC. 40. |
|---|
| 1350 | 1328 | | |
|---|
| 1351 | 1329 | | 1789.16. (a) A credit services organization shall not provide any service to a consumer except pursuant to a written contract that complies with this section. Every contract between the consumer and a credit services organization for the purchase of the services of the credit services organization shall identify the physical address, electronic mail address, and facsimile number if applicable, of the credit services organization, shall be in writing, shall be dated, shall be signed by the consumer, and shall include all of the following:(1) A conspicuous statement in size equal to at least 10-point boldface type, in immediate proximity to the space reserved for the signature of the buyer, as follows:You, the consumer, may cancel this contract at any time before midnight on the fifth working day after you sign it. See the attached notice of cancellation form for an explanation of this right.(2) The terms and conditions of payment, including the total of all payments to be made by the consumer, whether to the credit services organization or to some other person.(3) A full and detailed description of the services to be performed by the credit services organization for the consumer, including a list of the inaccurate or obsolete adverse information appearing on the consumers credit report which the credit services organization will seek to delete or modify, the basis for the deletion or modification, and, if applicable, a description of each modification sought and the anticipated payment required by the consumer to achieve each account deletion or modification, all guarantees and all promises of full or partial refunds, and the estimated date by which the services are to be performed, or the estimated length of time for performing the services, not to exceed 180 days, or a shorter period consistent with the purposes of this title as may be prescribed by the Department of Financial Protection and Innovation.(4) The credit services organizations principal business address and the name and address of its agent, other than the Secretary of State, in the State of California, authorized to receive service of process.(b) The contract shall be accompanied by a completed form in duplicate, captioned Notice of Cancellation, which shall be attached to the contract and easily detachable, and which shall contain in type of at least 10-point the following statement written in the same language as used in the contract:Notice of CancellationYou may cancel this contract, without any penalty or obligation, before midnight on the fifth working day after you sign it.If you cancel, any payment made by you under this contract must be returned within 15 days following receipt by the seller of your cancellation notice.To cancel this contract, mail or deliver a signed and dated copy of this cancellation notice, or any other written notice, to _____ (name of seller) _____ at _____ (address of seller)(place of business) _____ not later than midnight (date).I hereby cancel this transaction.(date) _____ (purchasers signature) _____ A copy of the fully completed contract and all other documents the credit services organization requires the buyer to sign shall be given to the consumer at the time they are signed.(c) This section shall become operative on January 1, 2023. |
|---|
| 1352 | 1330 | | |
|---|
| 1353 | 1331 | | 1789.16. (a) A credit services organization shall not provide any service to a consumer except pursuant to a written contract that complies with this section. Every contract between the consumer and a credit services organization for the purchase of the services of the credit services organization shall identify the physical address, electronic mail address, and facsimile number if applicable, of the credit services organization, shall be in writing, shall be dated, shall be signed by the consumer, and shall include all of the following:(1) A conspicuous statement in size equal to at least 10-point boldface type, in immediate proximity to the space reserved for the signature of the buyer, as follows:You, the consumer, may cancel this contract at any time before midnight on the fifth working day after you sign it. See the attached notice of cancellation form for an explanation of this right.(2) The terms and conditions of payment, including the total of all payments to be made by the consumer, whether to the credit services organization or to some other person.(3) A full and detailed description of the services to be performed by the credit services organization for the consumer, including a list of the inaccurate or obsolete adverse information appearing on the consumers credit report which the credit services organization will seek to delete or modify, the basis for the deletion or modification, and, if applicable, a description of each modification sought and the anticipated payment required by the consumer to achieve each account deletion or modification, all guarantees and all promises of full or partial refunds, and the estimated date by which the services are to be performed, or the estimated length of time for performing the services, not to exceed 180 days, or a shorter period consistent with the purposes of this title as may be prescribed by the Department of Financial Protection and Innovation.(4) The credit services organizations principal business address and the name and address of its agent, other than the Secretary of State, in the State of California, authorized to receive service of process.(b) The contract shall be accompanied by a completed form in duplicate, captioned Notice of Cancellation, which shall be attached to the contract and easily detachable, and which shall contain in type of at least 10-point the following statement written in the same language as used in the contract:Notice of CancellationYou may cancel this contract, without any penalty or obligation, before midnight on the fifth working day after you sign it.If you cancel, any payment made by you under this contract must be returned within 15 days following receipt by the seller of your cancellation notice.To cancel this contract, mail or deliver a signed and dated copy of this cancellation notice, or any other written notice, to _____ (name of seller) _____ at _____ (address of seller)(place of business) _____ not later than midnight (date).I hereby cancel this transaction.(date) _____ (purchasers signature) _____ A copy of the fully completed contract and all other documents the credit services organization requires the buyer to sign shall be given to the consumer at the time they are signed.(c) This section shall become operative on January 1, 2023. |
|---|
| 1354 | 1332 | | |
|---|
| 1355 | 1333 | | 1789.16. (a) A credit services organization shall not provide any service to a consumer except pursuant to a written contract that complies with this section. Every contract between the consumer and a credit services organization for the purchase of the services of the credit services organization shall identify the physical address, electronic mail address, and facsimile number if applicable, of the credit services organization, shall be in writing, shall be dated, shall be signed by the consumer, and shall include all of the following:(1) A conspicuous statement in size equal to at least 10-point boldface type, in immediate proximity to the space reserved for the signature of the buyer, as follows:You, the consumer, may cancel this contract at any time before midnight on the fifth working day after you sign it. See the attached notice of cancellation form for an explanation of this right.(2) The terms and conditions of payment, including the total of all payments to be made by the consumer, whether to the credit services organization or to some other person.(3) A full and detailed description of the services to be performed by the credit services organization for the consumer, including a list of the inaccurate or obsolete adverse information appearing on the consumers credit report which the credit services organization will seek to delete or modify, the basis for the deletion or modification, and, if applicable, a description of each modification sought and the anticipated payment required by the consumer to achieve each account deletion or modification, all guarantees and all promises of full or partial refunds, and the estimated date by which the services are to be performed, or the estimated length of time for performing the services, not to exceed 180 days, or a shorter period consistent with the purposes of this title as may be prescribed by the Department of Financial Protection and Innovation.(4) The credit services organizations principal business address and the name and address of its agent, other than the Secretary of State, in the State of California, authorized to receive service of process.(b) The contract shall be accompanied by a completed form in duplicate, captioned Notice of Cancellation, which shall be attached to the contract and easily detachable, and which shall contain in type of at least 10-point the following statement written in the same language as used in the contract:Notice of CancellationYou may cancel this contract, without any penalty or obligation, before midnight on the fifth working day after you sign it.If you cancel, any payment made by you under this contract must be returned within 15 days following receipt by the seller of your cancellation notice.To cancel this contract, mail or deliver a signed and dated copy of this cancellation notice, or any other written notice, to _____ (name of seller) _____ at _____ (address of seller)(place of business) _____ not later than midnight (date).I hereby cancel this transaction.(date) _____ (purchasers signature) _____ A copy of the fully completed contract and all other documents the credit services organization requires the buyer to sign shall be given to the consumer at the time they are signed.(c) This section shall become operative on January 1, 2023. |
|---|
| 1356 | 1334 | | |
|---|
| 1357 | 1335 | | |
|---|
| 1358 | 1336 | | |
|---|
| 1359 | 1337 | | 1789.16. (a) A credit services organization shall not provide any service to a consumer except pursuant to a written contract that complies with this section. Every contract between the consumer and a credit services organization for the purchase of the services of the credit services organization shall identify the physical address, electronic mail address, and facsimile number if applicable, of the credit services organization, shall be in writing, shall be dated, shall be signed by the consumer, and shall include all of the following: |
|---|
| 1360 | 1338 | | |
|---|
| 1361 | 1339 | | (1) A conspicuous statement in size equal to at least 10-point boldface type, in immediate proximity to the space reserved for the signature of the buyer, as follows: |
|---|
| 1362 | 1340 | | |
|---|
| 1363 | 1341 | | You, the consumer, may cancel this contract at any time before midnight on the fifth working day after you sign it. See the attached notice of cancellation form for an explanation of this right. |
|---|
| 1364 | 1342 | | |
|---|
| 1365 | 1343 | | (2) The terms and conditions of payment, including the total of all payments to be made by the consumer, whether to the credit services organization or to some other person. |
|---|
| 1366 | 1344 | | |
|---|
| 1367 | 1345 | | (3) A full and detailed description of the services to be performed by the credit services organization for the consumer, including a list of the inaccurate or obsolete adverse information appearing on the consumers credit report which the credit services organization will seek to delete or modify, the basis for the deletion or modification, and, if applicable, a description of each modification sought and the anticipated payment required by the consumer to achieve each account deletion or modification, all guarantees and all promises of full or partial refunds, and the estimated date by which the services are to be performed, or the estimated length of time for performing the services, not to exceed 180 days, or a shorter period consistent with the purposes of this title as may be prescribed by the Department of Financial Protection and Innovation. |
|---|
| 1368 | 1346 | | |
|---|
| 1369 | 1347 | | (4) The credit services organizations principal business address and the name and address of its agent, other than the Secretary of State, in the State of California, authorized to receive service of process. |
|---|
| 1370 | 1348 | | |
|---|
| 1371 | 1349 | | (b) The contract shall be accompanied by a completed form in duplicate, captioned Notice of Cancellation, which shall be attached to the contract and easily detachable, and which shall contain in type of at least 10-point the following statement written in the same language as used in the contract: |
|---|
| 1372 | 1350 | | |
|---|
| 1373 | 1351 | | Notice of Cancellation |
|---|
| 1374 | 1352 | | |
|---|
| 1375 | 1353 | | # Notice of Cancellation |
|---|
| 1376 | 1354 | | |
|---|
| 1377 | 1355 | | You may cancel this contract, without any penalty or obligation, before midnight on the fifth working day after you sign it. |
|---|
| 1378 | 1356 | | |
|---|
| 1379 | 1357 | | If you cancel, any payment made by you under this contract must be returned within 15 days following receipt by the seller of your cancellation notice. |
|---|
| 1380 | 1358 | | |
|---|
| 1381 | 1359 | | To cancel this contract, mail or deliver a signed and dated copy of this cancellation notice, or any other written notice, to |
|---|
| 1382 | 1360 | | _____ (name of seller) _____ at |
|---|
| 1383 | 1361 | | _____ (address of seller)(place of business) _____ |
|---|
| 1384 | 1362 | | not later than midnight (date). |
|---|
| 1385 | 1363 | | I hereby cancel this transaction. |
|---|
| 1386 | 1364 | | (date) _____ (purchasers signature) _____ |
|---|
| 1387 | 1365 | | |
|---|
| 1388 | 1366 | | To cancel this contract, mail or deliver a signed and dated copy of this cancellation notice, or any other written notice, to |
|---|
| 1389 | 1367 | | |
|---|
| 1390 | 1368 | | _____ (name of seller) _____ at |
|---|
| 1391 | 1369 | | |
|---|
| 1392 | 1370 | | _____ (address of seller)(place of business) _____ |
|---|
| 1393 | 1371 | | |
|---|
| 1394 | 1372 | | not later than midnight (date). |
|---|
| 1395 | 1373 | | |
|---|
| 1396 | 1374 | | I hereby cancel this transaction. |
|---|
| 1397 | 1375 | | |
|---|
| 1398 | 1376 | | (date) _____ (purchasers signature) _____ |
|---|
| 1399 | 1377 | | |
|---|
| 1400 | 1378 | | A copy of the fully completed contract and all other documents the credit services organization requires the buyer to sign shall be given to the consumer at the time they are signed. |
|---|
| 1401 | 1379 | | |
|---|
| 1402 | 1380 | | (c) This section shall become operative on January 1, 2023. |
|---|
| 1403 | 1381 | | |
|---|
| 1404 | 1382 | | SEC. 41. Section 1789.19 of the Civil Code is amended to read:1789.19. (a) Any waiver by a buyer of the provisions of this title shall be deemed contrary to public policy and shall be void and unenforceable. Any attempt by a credit services organization to have a buyer waive rights given by this title shall constitute a violation of this title.(b) In any proceeding involving this title, the burden of proving an exemption or an exception from a definition is upon the person claiming it.(c) This section shall become inoperative on January 1, 2023, and as of that date is repealed. |
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| 1405 | 1383 | | |
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| 1406 | 1384 | | SEC. 41. Section 1789.19 of the Civil Code is amended to read: |
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| 1407 | 1385 | | |
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| 1408 | 1386 | | ### SEC. 41. |
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| 1409 | 1387 | | |
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| 1410 | 1388 | | 1789.19. (a) Any waiver by a buyer of the provisions of this title shall be deemed contrary to public policy and shall be void and unenforceable. Any attempt by a credit services organization to have a buyer waive rights given by this title shall constitute a violation of this title.(b) In any proceeding involving this title, the burden of proving an exemption or an exception from a definition is upon the person claiming it.(c) This section shall become inoperative on January 1, 2023, and as of that date is repealed. |
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| 1411 | 1389 | | |
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| 1412 | 1390 | | 1789.19. (a) Any waiver by a buyer of the provisions of this title shall be deemed contrary to public policy and shall be void and unenforceable. Any attempt by a credit services organization to have a buyer waive rights given by this title shall constitute a violation of this title.(b) In any proceeding involving this title, the burden of proving an exemption or an exception from a definition is upon the person claiming it.(c) This section shall become inoperative on January 1, 2023, and as of that date is repealed. |
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| 1413 | 1391 | | |
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| 1414 | 1392 | | 1789.19. (a) Any waiver by a buyer of the provisions of this title shall be deemed contrary to public policy and shall be void and unenforceable. Any attempt by a credit services organization to have a buyer waive rights given by this title shall constitute a violation of this title.(b) In any proceeding involving this title, the burden of proving an exemption or an exception from a definition is upon the person claiming it.(c) This section shall become inoperative on January 1, 2023, and as of that date is repealed. |
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| 1415 | 1393 | | |
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| 1416 | 1394 | | |
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| 1417 | 1395 | | |
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| 1418 | 1396 | | 1789.19. (a) Any waiver by a buyer of the provisions of this title shall be deemed contrary to public policy and shall be void and unenforceable. Any attempt by a credit services organization to have a buyer waive rights given by this title shall constitute a violation of this title. |
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| 1419 | 1397 | | |
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| 1420 | 1398 | | (b) In any proceeding involving this title, the burden of proving an exemption or an exception from a definition is upon the person claiming it. |
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| 1421 | 1399 | | |
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| 1422 | 1400 | | (c) This section shall become inoperative on January 1, 2023, and as of that date is repealed. |
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| 1423 | 1401 | | |
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| 1424 | 1402 | | SEC. 42. Section 1789.19 is added to the Civil Code, to read:1789.19. (a) Any waiver by a consumer of the provisions of this title shall be deemed contrary to public policy and shall be void and unenforceable. Any attempt by a credit services organization to have a consumer waive rights given by this title shall constitute a violation of this title.(b) In any proceeding involving this title, the burden of proving an exemption or an exception from a definition is upon the person claiming it.(c) This section shall become operative on January 1, 2023. |
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| 1425 | 1403 | | |
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| 1426 | 1404 | | SEC. 42. Section 1789.19 is added to the Civil Code, to read: |
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| 1427 | 1405 | | |
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| 1428 | 1406 | | ### SEC. 42. |
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| 1429 | 1407 | | |
|---|
| 1430 | 1408 | | 1789.19. (a) Any waiver by a consumer of the provisions of this title shall be deemed contrary to public policy and shall be void and unenforceable. Any attempt by a credit services organization to have a consumer waive rights given by this title shall constitute a violation of this title.(b) In any proceeding involving this title, the burden of proving an exemption or an exception from a definition is upon the person claiming it.(c) This section shall become operative on January 1, 2023. |
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| 1431 | 1409 | | |
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| 1432 | 1410 | | 1789.19. (a) Any waiver by a consumer of the provisions of this title shall be deemed contrary to public policy and shall be void and unenforceable. Any attempt by a credit services organization to have a consumer waive rights given by this title shall constitute a violation of this title.(b) In any proceeding involving this title, the burden of proving an exemption or an exception from a definition is upon the person claiming it.(c) This section shall become operative on January 1, 2023. |
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| 1433 | 1411 | | |
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| 1434 | 1412 | | 1789.19. (a) Any waiver by a consumer of the provisions of this title shall be deemed contrary to public policy and shall be void and unenforceable. Any attempt by a credit services organization to have a consumer waive rights given by this title shall constitute a violation of this title.(b) In any proceeding involving this title, the burden of proving an exemption or an exception from a definition is upon the person claiming it.(c) This section shall become operative on January 1, 2023. |
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| 1435 | 1413 | | |
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| 1436 | 1414 | | |
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| 1437 | 1415 | | |
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| 1438 | 1416 | | 1789.19. (a) Any waiver by a consumer of the provisions of this title shall be deemed contrary to public policy and shall be void and unenforceable. Any attempt by a credit services organization to have a consumer waive rights given by this title shall constitute a violation of this title. |
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| 1439 | 1417 | | |
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| 1440 | 1418 | | (b) In any proceeding involving this title, the burden of proving an exemption or an exception from a definition is upon the person claiming it. |
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| 1441 | 1419 | | |
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| 1442 | 1420 | | (c) This section shall become operative on January 1, 2023. |
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| 1443 | 1421 | | |
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| 1444 | 1422 | | SEC. 43. Section 1789.21 of the Civil Code is amended to read:1789.21. (a) Any buyer injured by a violation of this title or by the credit services organizations breach of a contract subject to this title may bring any action for recovery of damages, or for injunctive relief, or both. Judgment shall be entered for actual damages, but in no case less than the amount paid by the buyer to the credit services organization, plus reasonable attorneys fees and costs. An award, if the trial court deems it proper, may be entered for punitive damages.(b) Any person, including, but not limited to, a consumer credit reporting agency, as defined in subdivision (d) of Section 1785.3, and any consumer of, or user of, a consumer credit report under the Consumer Credit Reporting Agencies Act (Title 1.6 (commencing with Section 1785.1)), and any furnisher of credit information under the Consumer Credit Reporting Agencies Act, may bring an action for the recovery of damages or for injunctive relief, or both, for a violation of this title. Any person bringing such an action who prevails in the action shall be entitled to reasonable attorneys fees and costs.(c) This section shall remain in effect until January 1, 2023, and as of that date is repealed. |
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| 1445 | 1423 | | |
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| 1446 | 1424 | | SEC. 43. Section 1789.21 of the Civil Code is amended to read: |
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| 1447 | 1425 | | |
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| 1448 | 1426 | | ### SEC. 43. |
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| 1449 | 1427 | | |
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| 1450 | 1428 | | 1789.21. (a) Any buyer injured by a violation of this title or by the credit services organizations breach of a contract subject to this title may bring any action for recovery of damages, or for injunctive relief, or both. Judgment shall be entered for actual damages, but in no case less than the amount paid by the buyer to the credit services organization, plus reasonable attorneys fees and costs. An award, if the trial court deems it proper, may be entered for punitive damages.(b) Any person, including, but not limited to, a consumer credit reporting agency, as defined in subdivision (d) of Section 1785.3, and any consumer of, or user of, a consumer credit report under the Consumer Credit Reporting Agencies Act (Title 1.6 (commencing with Section 1785.1)), and any furnisher of credit information under the Consumer Credit Reporting Agencies Act, may bring an action for the recovery of damages or for injunctive relief, or both, for a violation of this title. Any person bringing such an action who prevails in the action shall be entitled to reasonable attorneys fees and costs.(c) This section shall remain in effect until January 1, 2023, and as of that date is repealed. |
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| 1451 | 1429 | | |
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| 1452 | 1430 | | 1789.21. (a) Any buyer injured by a violation of this title or by the credit services organizations breach of a contract subject to this title may bring any action for recovery of damages, or for injunctive relief, or both. Judgment shall be entered for actual damages, but in no case less than the amount paid by the buyer to the credit services organization, plus reasonable attorneys fees and costs. An award, if the trial court deems it proper, may be entered for punitive damages.(b) Any person, including, but not limited to, a consumer credit reporting agency, as defined in subdivision (d) of Section 1785.3, and any consumer of, or user of, a consumer credit report under the Consumer Credit Reporting Agencies Act (Title 1.6 (commencing with Section 1785.1)), and any furnisher of credit information under the Consumer Credit Reporting Agencies Act, may bring an action for the recovery of damages or for injunctive relief, or both, for a violation of this title. Any person bringing such an action who prevails in the action shall be entitled to reasonable attorneys fees and costs.(c) This section shall remain in effect until January 1, 2023, and as of that date is repealed. |
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| 1453 | 1431 | | |
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| 1454 | 1432 | | 1789.21. (a) Any buyer injured by a violation of this title or by the credit services organizations breach of a contract subject to this title may bring any action for recovery of damages, or for injunctive relief, or both. Judgment shall be entered for actual damages, but in no case less than the amount paid by the buyer to the credit services organization, plus reasonable attorneys fees and costs. An award, if the trial court deems it proper, may be entered for punitive damages.(b) Any person, including, but not limited to, a consumer credit reporting agency, as defined in subdivision (d) of Section 1785.3, and any consumer of, or user of, a consumer credit report under the Consumer Credit Reporting Agencies Act (Title 1.6 (commencing with Section 1785.1)), and any furnisher of credit information under the Consumer Credit Reporting Agencies Act, may bring an action for the recovery of damages or for injunctive relief, or both, for a violation of this title. Any person bringing such an action who prevails in the action shall be entitled to reasonable attorneys fees and costs.(c) This section shall remain in effect until January 1, 2023, and as of that date is repealed. |
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| 1455 | 1433 | | |
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| 1456 | 1434 | | |
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| 1457 | 1435 | | |
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| 1458 | 1436 | | 1789.21. (a) Any buyer injured by a violation of this title or by the credit services organizations breach of a contract subject to this title may bring any action for recovery of damages, or for injunctive relief, or both. Judgment shall be entered for actual damages, but in no case less than the amount paid by the buyer to the credit services organization, plus reasonable attorneys fees and costs. An award, if the trial court deems it proper, may be entered for punitive damages. |
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| 1459 | 1437 | | |
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| 1460 | 1438 | | (b) Any person, including, but not limited to, a consumer credit reporting agency, as defined in subdivision (d) of Section 1785.3, and any consumer of, or user of, a consumer credit report under the Consumer Credit Reporting Agencies Act (Title 1.6 (commencing with Section 1785.1)), and any furnisher of credit information under the Consumer Credit Reporting Agencies Act, may bring an action for the recovery of damages or for injunctive relief, or both, for a violation of this title. Any person bringing such an action who prevails in the action shall be entitled to reasonable attorneys fees and costs. |
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| 1461 | 1439 | | |
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| 1462 | 1440 | | (c) This section shall remain in effect until January 1, 2023, and as of that date is repealed. |
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| 1463 | 1441 | | |
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| 1464 | 1442 | | SEC. 44. Section 1789.21 is added to the Civil Code, to read:1789.21. (a) Any consumer injured by a violation of this title or by the credit services organizations breach of a contract subject to this title may bring any action for recovery of damages, or for injunctive relief, or both. Judgment shall be entered for actual damages, but in no case less than the amount paid by the consumer to the credit services organization, plus reasonable attorneys fees and costs. An award, if the trial court deems it proper, may be entered for punitive damages.(b) Any credit services organization that willfully and knowingly violates this title with respect to any consumer, in addition to any damages awarded pursuant to subdivision (a), shall also be liable to the consumer, in an individual action, for a civil penalty of not less than one hundred dollars ($100) and not greater than one thousand dollars ($1,000), to be determined by the court.(c) Any person, including, but not limited to, a consumer credit reporting agency, as defined in subdivision (d) of Section 1785.3, and any consumer of, or user of, a consumer credit report under the Consumer Credit Reporting Agencies Act (Title 1.6 (commencing with Section 1785.1)), and any furnisher of credit information under the Consumer Credit Reporting Agencies Act, may bring an action for the recovery of damages or for injunctive relief, or both, for a violation of this title. Any person bringing such an action who prevails in the action shall be entitled to reasonable attorneys fees and costs.(d) This section shall become operative on January 1, 2023. |
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| 1465 | 1443 | | |
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| 1466 | 1444 | | SEC. 44. Section 1789.21 is added to the Civil Code, to read: |
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| 1467 | 1445 | | |
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| 1468 | 1446 | | ### SEC. 44. |
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| 1469 | 1447 | | |
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| 1470 | 1448 | | 1789.21. (a) Any consumer injured by a violation of this title or by the credit services organizations breach of a contract subject to this title may bring any action for recovery of damages, or for injunctive relief, or both. Judgment shall be entered for actual damages, but in no case less than the amount paid by the consumer to the credit services organization, plus reasonable attorneys fees and costs. An award, if the trial court deems it proper, may be entered for punitive damages.(b) Any credit services organization that willfully and knowingly violates this title with respect to any consumer, in addition to any damages awarded pursuant to subdivision (a), shall also be liable to the consumer, in an individual action, for a civil penalty of not less than one hundred dollars ($100) and not greater than one thousand dollars ($1,000), to be determined by the court.(c) Any person, including, but not limited to, a consumer credit reporting agency, as defined in subdivision (d) of Section 1785.3, and any consumer of, or user of, a consumer credit report under the Consumer Credit Reporting Agencies Act (Title 1.6 (commencing with Section 1785.1)), and any furnisher of credit information under the Consumer Credit Reporting Agencies Act, may bring an action for the recovery of damages or for injunctive relief, or both, for a violation of this title. Any person bringing such an action who prevails in the action shall be entitled to reasonable attorneys fees and costs.(d) This section shall become operative on January 1, 2023. |
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| 1471 | 1449 | | |
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| 1472 | 1450 | | 1789.21. (a) Any consumer injured by a violation of this title or by the credit services organizations breach of a contract subject to this title may bring any action for recovery of damages, or for injunctive relief, or both. Judgment shall be entered for actual damages, but in no case less than the amount paid by the consumer to the credit services organization, plus reasonable attorneys fees and costs. An award, if the trial court deems it proper, may be entered for punitive damages.(b) Any credit services organization that willfully and knowingly violates this title with respect to any consumer, in addition to any damages awarded pursuant to subdivision (a), shall also be liable to the consumer, in an individual action, for a civil penalty of not less than one hundred dollars ($100) and not greater than one thousand dollars ($1,000), to be determined by the court.(c) Any person, including, but not limited to, a consumer credit reporting agency, as defined in subdivision (d) of Section 1785.3, and any consumer of, or user of, a consumer credit report under the Consumer Credit Reporting Agencies Act (Title 1.6 (commencing with Section 1785.1)), and any furnisher of credit information under the Consumer Credit Reporting Agencies Act, may bring an action for the recovery of damages or for injunctive relief, or both, for a violation of this title. Any person bringing such an action who prevails in the action shall be entitled to reasonable attorneys fees and costs.(d) This section shall become operative on January 1, 2023. |
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| 1473 | 1451 | | |
|---|
| 1474 | 1452 | | 1789.21. (a) Any consumer injured by a violation of this title or by the credit services organizations breach of a contract subject to this title may bring any action for recovery of damages, or for injunctive relief, or both. Judgment shall be entered for actual damages, but in no case less than the amount paid by the consumer to the credit services organization, plus reasonable attorneys fees and costs. An award, if the trial court deems it proper, may be entered for punitive damages.(b) Any credit services organization that willfully and knowingly violates this title with respect to any consumer, in addition to any damages awarded pursuant to subdivision (a), shall also be liable to the consumer, in an individual action, for a civil penalty of not less than one hundred dollars ($100) and not greater than one thousand dollars ($1,000), to be determined by the court.(c) Any person, including, but not limited to, a consumer credit reporting agency, as defined in subdivision (d) of Section 1785.3, and any consumer of, or user of, a consumer credit report under the Consumer Credit Reporting Agencies Act (Title 1.6 (commencing with Section 1785.1)), and any furnisher of credit information under the Consumer Credit Reporting Agencies Act, may bring an action for the recovery of damages or for injunctive relief, or both, for a violation of this title. Any person bringing such an action who prevails in the action shall be entitled to reasonable attorneys fees and costs.(d) This section shall become operative on January 1, 2023. |
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| 1475 | 1453 | | |
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| 1476 | 1454 | | |
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| 1477 | 1455 | | |
|---|
| 1478 | 1456 | | 1789.21. (a) Any consumer injured by a violation of this title or by the credit services organizations breach of a contract subject to this title may bring any action for recovery of damages, or for injunctive relief, or both. Judgment shall be entered for actual damages, but in no case less than the amount paid by the consumer to the credit services organization, plus reasonable attorneys fees and costs. An award, if the trial court deems it proper, may be entered for punitive damages. |
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| 1479 | 1457 | | |
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| 1480 | 1458 | | (b) Any credit services organization that willfully and knowingly violates this title with respect to any consumer, in addition to any damages awarded pursuant to subdivision (a), shall also be liable to the consumer, in an individual action, for a civil penalty of not less than one hundred dollars ($100) and not greater than one thousand dollars ($1,000), to be determined by the court. |
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| 1481 | 1459 | | |
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| 1482 | 1460 | | (c) Any person, including, but not limited to, a consumer credit reporting agency, as defined in subdivision (d) of Section 1785.3, and any consumer of, or user of, a consumer credit report under the Consumer Credit Reporting Agencies Act (Title 1.6 (commencing with Section 1785.1)), and any furnisher of credit information under the Consumer Credit Reporting Agencies Act, may bring an action for the recovery of damages or for injunctive relief, or both, for a violation of this title. Any person bringing such an action who prevails in the action shall be entitled to reasonable attorneys fees and costs. |
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| 1483 | 1461 | | |
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| 1484 | 1462 | | (d) This section shall become operative on January 1, 2023. |
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| 1485 | 1463 | | |
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| 1486 | 1464 | | SEC. 45. Section 1789.25 of the Civil Code is amended to read:1789.25. (a) Every credit services organization shall file a registration application with, and receive a certificate of registration from, the Department of Justice before conducting business in this state. The Department of Justice shall not issue a certificate of registration until the bond required by Section 1789.18 has been filed with the office of the Secretary of State and the department establishes that the organization seeking a certificate satisfies the requirements of subdivision (f). The application shall be accompanied by a registration fee of one hundred dollars ($100). The registration application shall contain all of the following information:(1) The name and address where business is actually conducted of the credit services organization.(2) The names, addresses, and drivers license numbers of any and all persons who directly or indirectly own or control 10 percent or more of the outstanding shares of stock in the credit services organization.(3) Either of the following:(A) A full and complete disclosure of any litigation commenced against the credit services organization or any resolved or unresolved complaint that relates to the operation of the credit services organization and that is filed with the Attorney General or any other governmental authority of this state, any other state, or the federal government. With respect to each resolved complaint identified by the disclosure, the disclosure shall include a brief description of the resolution.(B) An acknowledged declaration under penalty of perjury stating that no litigation has been commenced and no unresolved complaint relating to the operation of the organization has been filed with the Attorney General or any other governmental authority of this state, any other state, or the federal government.(4) Other information that the Department of Justice requires, either at the time of application or thereafter.(b) The Department of Justice may conduct an investigation to verify the accuracy of the registration application. If the application involves investigation outside this state, the applicant credit services organization may be required by the Department of Justice to advance sufficient funds to pay the actual expenses of the investigation. Any nonresident applying for registration under this section shall designate and maintain a resident of this state as the applicants agent for the purpose of receipt of service of process.(c) Each credit services organization shall notify the Department of Justice in writing within 30 days after the date of a change in the information required by subdivision (a), except that 30 days advance notice and approval by the Department of Justice shall be required before changing the corporate name or address, or persons owning more than 10 percent of the shares of stock in the organization. Each credit services organization registering under this section may use no more than one fictitious or trade name and shall maintain a copy of the registration application in its files. The organization shall allow a buyer to inspect the registration application upon request.(d) A certificate of registration issued pursuant to this section shall expire annually on the last day of December but may be renewed by filing a renewal application accompanied by a fee not to exceed the Department of Justices costs of administration.(e) The credit services organization shall attach to the registration statement a copy of the contract or contracts which the credit services organization intends to execute with its customers and a copy of the required bond.(f) The Department of Justice shall not issue a certificate of registration under this title to any person who has engaged in, or proposes to engage in, any activity that is in violation of Section 1789.13, any law prohibiting the use of untrue or misleading statements, or any law related to the extension of credit to persons for personal, family, or household purposes.(g) This section shall become inoperative on January 1, 2023, and as of that date is repealed. |
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| 1487 | 1465 | | |
|---|
| 1488 | 1466 | | SEC. 45. Section 1789.25 of the Civil Code is amended to read: |
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| 1489 | 1467 | | |
|---|
| 1490 | 1468 | | ### SEC. 45. |
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| 1491 | 1469 | | |
|---|
| 1492 | 1470 | | 1789.25. (a) Every credit services organization shall file a registration application with, and receive a certificate of registration from, the Department of Justice before conducting business in this state. The Department of Justice shall not issue a certificate of registration until the bond required by Section 1789.18 has been filed with the office of the Secretary of State and the department establishes that the organization seeking a certificate satisfies the requirements of subdivision (f). The application shall be accompanied by a registration fee of one hundred dollars ($100). The registration application shall contain all of the following information:(1) The name and address where business is actually conducted of the credit services organization.(2) The names, addresses, and drivers license numbers of any and all persons who directly or indirectly own or control 10 percent or more of the outstanding shares of stock in the credit services organization.(3) Either of the following:(A) A full and complete disclosure of any litigation commenced against the credit services organization or any resolved or unresolved complaint that relates to the operation of the credit services organization and that is filed with the Attorney General or any other governmental authority of this state, any other state, or the federal government. With respect to each resolved complaint identified by the disclosure, the disclosure shall include a brief description of the resolution.(B) An acknowledged declaration under penalty of perjury stating that no litigation has been commenced and no unresolved complaint relating to the operation of the organization has been filed with the Attorney General or any other governmental authority of this state, any other state, or the federal government.(4) Other information that the Department of Justice requires, either at the time of application or thereafter.(b) The Department of Justice may conduct an investigation to verify the accuracy of the registration application. If the application involves investigation outside this state, the applicant credit services organization may be required by the Department of Justice to advance sufficient funds to pay the actual expenses of the investigation. Any nonresident applying for registration under this section shall designate and maintain a resident of this state as the applicants agent for the purpose of receipt of service of process.(c) Each credit services organization shall notify the Department of Justice in writing within 30 days after the date of a change in the information required by subdivision (a), except that 30 days advance notice and approval by the Department of Justice shall be required before changing the corporate name or address, or persons owning more than 10 percent of the shares of stock in the organization. Each credit services organization registering under this section may use no more than one fictitious or trade name and shall maintain a copy of the registration application in its files. The organization shall allow a buyer to inspect the registration application upon request.(d) A certificate of registration issued pursuant to this section shall expire annually on the last day of December but may be renewed by filing a renewal application accompanied by a fee not to exceed the Department of Justices costs of administration.(e) The credit services organization shall attach to the registration statement a copy of the contract or contracts which the credit services organization intends to execute with its customers and a copy of the required bond.(f) The Department of Justice shall not issue a certificate of registration under this title to any person who has engaged in, or proposes to engage in, any activity that is in violation of Section 1789.13, any law prohibiting the use of untrue or misleading statements, or any law related to the extension of credit to persons for personal, family, or household purposes.(g) This section shall become inoperative on January 1, 2023, and as of that date is repealed. |
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| 1493 | 1471 | | |
|---|
| 1494 | 1472 | | 1789.25. (a) Every credit services organization shall file a registration application with, and receive a certificate of registration from, the Department of Justice before conducting business in this state. The Department of Justice shall not issue a certificate of registration until the bond required by Section 1789.18 has been filed with the office of the Secretary of State and the department establishes that the organization seeking a certificate satisfies the requirements of subdivision (f). The application shall be accompanied by a registration fee of one hundred dollars ($100). The registration application shall contain all of the following information:(1) The name and address where business is actually conducted of the credit services organization.(2) The names, addresses, and drivers license numbers of any and all persons who directly or indirectly own or control 10 percent or more of the outstanding shares of stock in the credit services organization.(3) Either of the following:(A) A full and complete disclosure of any litigation commenced against the credit services organization or any resolved or unresolved complaint that relates to the operation of the credit services organization and that is filed with the Attorney General or any other governmental authority of this state, any other state, or the federal government. With respect to each resolved complaint identified by the disclosure, the disclosure shall include a brief description of the resolution.(B) An acknowledged declaration under penalty of perjury stating that no litigation has been commenced and no unresolved complaint relating to the operation of the organization has been filed with the Attorney General or any other governmental authority of this state, any other state, or the federal government.(4) Other information that the Department of Justice requires, either at the time of application or thereafter.(b) The Department of Justice may conduct an investigation to verify the accuracy of the registration application. If the application involves investigation outside this state, the applicant credit services organization may be required by the Department of Justice to advance sufficient funds to pay the actual expenses of the investigation. Any nonresident applying for registration under this section shall designate and maintain a resident of this state as the applicants agent for the purpose of receipt of service of process.(c) Each credit services organization shall notify the Department of Justice in writing within 30 days after the date of a change in the information required by subdivision (a), except that 30 days advance notice and approval by the Department of Justice shall be required before changing the corporate name or address, or persons owning more than 10 percent of the shares of stock in the organization. Each credit services organization registering under this section may use no more than one fictitious or trade name and shall maintain a copy of the registration application in its files. The organization shall allow a buyer to inspect the registration application upon request.(d) A certificate of registration issued pursuant to this section shall expire annually on the last day of December but may be renewed by filing a renewal application accompanied by a fee not to exceed the Department of Justices costs of administration.(e) The credit services organization shall attach to the registration statement a copy of the contract or contracts which the credit services organization intends to execute with its customers and a copy of the required bond.(f) The Department of Justice shall not issue a certificate of registration under this title to any person who has engaged in, or proposes to engage in, any activity that is in violation of Section 1789.13, any law prohibiting the use of untrue or misleading statements, or any law related to the extension of credit to persons for personal, family, or household purposes.(g) This section shall become inoperative on January 1, 2023, and as of that date is repealed. |
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| 1495 | 1473 | | |
|---|
| 1496 | 1474 | | 1789.25. (a) Every credit services organization shall file a registration application with, and receive a certificate of registration from, the Department of Justice before conducting business in this state. The Department of Justice shall not issue a certificate of registration until the bond required by Section 1789.18 has been filed with the office of the Secretary of State and the department establishes that the organization seeking a certificate satisfies the requirements of subdivision (f). The application shall be accompanied by a registration fee of one hundred dollars ($100). The registration application shall contain all of the following information:(1) The name and address where business is actually conducted of the credit services organization.(2) The names, addresses, and drivers license numbers of any and all persons who directly or indirectly own or control 10 percent or more of the outstanding shares of stock in the credit services organization.(3) Either of the following:(A) A full and complete disclosure of any litigation commenced against the credit services organization or any resolved or unresolved complaint that relates to the operation of the credit services organization and that is filed with the Attorney General or any other governmental authority of this state, any other state, or the federal government. With respect to each resolved complaint identified by the disclosure, the disclosure shall include a brief description of the resolution.(B) An acknowledged declaration under penalty of perjury stating that no litigation has been commenced and no unresolved complaint relating to the operation of the organization has been filed with the Attorney General or any other governmental authority of this state, any other state, or the federal government.(4) Other information that the Department of Justice requires, either at the time of application or thereafter.(b) The Department of Justice may conduct an investigation to verify the accuracy of the registration application. If the application involves investigation outside this state, the applicant credit services organization may be required by the Department of Justice to advance sufficient funds to pay the actual expenses of the investigation. Any nonresident applying for registration under this section shall designate and maintain a resident of this state as the applicants agent for the purpose of receipt of service of process.(c) Each credit services organization shall notify the Department of Justice in writing within 30 days after the date of a change in the information required by subdivision (a), except that 30 days advance notice and approval by the Department of Justice shall be required before changing the corporate name or address, or persons owning more than 10 percent of the shares of stock in the organization. Each credit services organization registering under this section may use no more than one fictitious or trade name and shall maintain a copy of the registration application in its files. The organization shall allow a buyer to inspect the registration application upon request.(d) A certificate of registration issued pursuant to this section shall expire annually on the last day of December but may be renewed by filing a renewal application accompanied by a fee not to exceed the Department of Justices costs of administration.(e) The credit services organization shall attach to the registration statement a copy of the contract or contracts which the credit services organization intends to execute with its customers and a copy of the required bond.(f) The Department of Justice shall not issue a certificate of registration under this title to any person who has engaged in, or proposes to engage in, any activity that is in violation of Section 1789.13, any law prohibiting the use of untrue or misleading statements, or any law related to the extension of credit to persons for personal, family, or household purposes.(g) This section shall become inoperative on January 1, 2023, and as of that date is repealed. |
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| 1497 | 1475 | | |
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| 1498 | 1476 | | |
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| 1499 | 1477 | | |
|---|
| 1500 | 1478 | | 1789.25. (a) Every credit services organization shall file a registration application with, and receive a certificate of registration from, the Department of Justice before conducting business in this state. The Department of Justice shall not issue a certificate of registration until the bond required by Section 1789.18 has been filed with the office of the Secretary of State and the department establishes that the organization seeking a certificate satisfies the requirements of subdivision (f). The application shall be accompanied by a registration fee of one hundred dollars ($100). The registration application shall contain all of the following information: |
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| 1501 | 1479 | | |
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| 1502 | 1480 | | (1) The name and address where business is actually conducted of the credit services organization. |
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| 1503 | 1481 | | |
|---|
| 1504 | 1482 | | (2) The names, addresses, and drivers license numbers of any and all persons who directly or indirectly own or control 10 percent or more of the outstanding shares of stock in the credit services organization. |
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| 1505 | 1483 | | |
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| 1506 | 1484 | | (3) Either of the following: |
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| 1507 | 1485 | | |
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| 1508 | 1486 | | (A) A full and complete disclosure of any litigation commenced against the credit services organization or any resolved or unresolved complaint that relates to the operation of the credit services organization and that is filed with the Attorney General or any other governmental authority of this state, any other state, or the federal government. With respect to each resolved complaint identified by the disclosure, the disclosure shall include a brief description of the resolution. |
|---|
| 1509 | 1487 | | |
|---|
| 1510 | 1488 | | (B) An acknowledged declaration under penalty of perjury stating that no litigation has been commenced and no unresolved complaint relating to the operation of the organization has been filed with the Attorney General or any other governmental authority of this state, any other state, or the federal government. |
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| 1511 | 1489 | | |
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| 1512 | 1490 | | (4) Other information that the Department of Justice requires, either at the time of application or thereafter. |
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| 1513 | 1491 | | |
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| 1514 | 1492 | | (b) The Department of Justice may conduct an investigation to verify the accuracy of the registration application. If the application involves investigation outside this state, the applicant credit services organization may be required by the Department of Justice to advance sufficient funds to pay the actual expenses of the investigation. Any nonresident applying for registration under this section shall designate and maintain a resident of this state as the applicants agent for the purpose of receipt of service of process. |
|---|
| 1515 | 1493 | | |
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| 1516 | 1494 | | (c) Each credit services organization shall notify the Department of Justice in writing within 30 days after the date of a change in the information required by subdivision (a), except that 30 days advance notice and approval by the Department of Justice shall be required before changing the corporate name or address, or persons owning more than 10 percent of the shares of stock in the organization. Each credit services organization registering under this section may use no more than one fictitious or trade name and shall maintain a copy of the registration application in its files. The organization shall allow a buyer to inspect the registration application upon request. |
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| 1517 | 1495 | | |
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| 1518 | 1496 | | (d) A certificate of registration issued pursuant to this section shall expire annually on the last day of December but may be renewed by filing a renewal application accompanied by a fee not to exceed the Department of Justices costs of administration. |
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| 1519 | 1497 | | |
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| 1520 | 1498 | | (e) The credit services organization shall attach to the registration statement a copy of the contract or contracts which the credit services organization intends to execute with its customers and a copy of the required bond. |
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| 1521 | 1499 | | |
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| 1522 | 1500 | | (f) The Department of Justice shall not issue a certificate of registration under this title to any person who has engaged in, or proposes to engage in, any activity that is in violation of Section 1789.13, any law prohibiting the use of untrue or misleading statements, or any law related to the extension of credit to persons for personal, family, or household purposes. |
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| 1523 | 1501 | | |
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| 1524 | 1502 | | (g) This section shall become inoperative on January 1, 2023, and as of that date is repealed. |
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| 1525 | 1503 | | |
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| 1526 | 1504 | | SEC. 46. Section 1789.25 is added to the Civil Code, to read:1789.25. (a) Every credit services organization shall file an application for licensure with, and receive a license from, the Department of Financial Protection and Innovation before conducting business in this state. The Department of Financial Protection and Innovation shall not issue a license until the bond required by Section 1789.18 has been filed with the Office of the Secretary of State and the department establishes that the organization seeking a license satisfies the requirements of subdivision (f). The application shall be accompanied by a license fee of one hundred dollars ($100). The Department of Financial Protection and Innovation may, periodically, increase the fee, but the amount of the fee shall not exceed that which is reasonable and necessary to satisfy its costs in complying with its duties under this title to regulate credit services organizations. The application shall contain all of the following information:(1) The name and address where business is actually conducted of the credit services organization.(2) The names, addresses, and drivers license numbers of any and all persons who directly or indirectly own or control 10 percent or more of the outstanding shares of stock in the credit services organization.(3) Either of the following:(A) A full and complete disclosure of any litigation commenced against the credit services organization or any resolved or unresolved complaint that relates to the operation of the credit services organization and that is filed with the Department of Financial Protection and Innovation, the Attorney General, or any other governmental authority of this state, any other state, or the federal government. With respect to each resolved complaint identified by the disclosure, the disclosure shall include a brief description of the resolution.(B) An acknowledged declaration under penalty of perjury stating that no litigation has been commenced and no unresolved complaint relating to the operation of the organization has been filed with the Department of Financial Protection and Innovation, the Attorney General, or any other governmental authority of this state, any other state, or the federal government.(4) Other information that the Department of Financial Protection and Innovation requires, either at the time of application or thereafter.(b) The Department of Financial Protection and Innovation may conduct an investigation to verify the accuracy of the licensure application. If the application involves investigation outside this state, the applicant credit services organization may be required by the Department of Financial Protection and Innovation to advance sufficient funds to pay the actual expenses of the investigation. Any nonresident applying for licensure under this section shall designate and maintain a resident of this state as the applicants agent for the purpose of receipt of service of process.(c) Each credit services organization shall notify the Department of Financial Protection and Innovation in writing within 30 days after the date of a change in the information required by subdivision (a), except that 30 days advance notice and approval by the Department of Financial Protection and Innovation shall be required before changing the corporate name or address, or persons owning more than 10 percent of the shares of stock in the organization. Each credit services organization applying for licensure under this section may use no more than one fictitious or trade name and shall maintain a copy of the license application in its files. The organization shall allow a buyer to inspect the license application upon request.(d) A license issued pursuant to this section shall expire one year after it was issued, but may be renewed by filing a renewal application accompanied by a fee in an amount to be determined annually by the Department of Financial Protection and Innovation as is reasonable and necessary to satisfy its costs in complying with its duties under this title to regulate credit services organizations. The Department of Financial Protection and Innovation may, periodically, increase the fee, but the amount of the fee shall not exceed that which is reasonable and necessary to satisfy its costs in complying with its duties under this title to regulate credit services organizations.(e) The credit services organization shall attach to the license statement a copy of the contract or contracts which the credit services organization intends to execute with its customers and a copy of the required bond.(f) The Department of Financial Protection and Innovation shall not issue a license under this title to any person who has engaged in, or proposes to engage in, any activity that is in violation of Section 1789.13, any law prohibiting the use of untrue or misleading statements, or any law related to the extension of credit to persons for personal, family, or household purposes.(g) The Department of Financial Protection and Innovation shall maintain on a publicly available internet website a list of the credit services organizations that are licensed in this state.(h) This section shall become operative on January 1, 2023. |
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| 1527 | 1505 | | |
|---|
| 1528 | 1506 | | SEC. 46. Section 1789.25 is added to the Civil Code, to read: |
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| 1529 | 1507 | | |
|---|
| 1530 | 1508 | | ### SEC. 46. |
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| 1531 | 1509 | | |
|---|
| 1532 | 1510 | | 1789.25. (a) Every credit services organization shall file an application for licensure with, and receive a license from, the Department of Financial Protection and Innovation before conducting business in this state. The Department of Financial Protection and Innovation shall not issue a license until the bond required by Section 1789.18 has been filed with the Office of the Secretary of State and the department establishes that the organization seeking a license satisfies the requirements of subdivision (f). The application shall be accompanied by a license fee of one hundred dollars ($100). The Department of Financial Protection and Innovation may, periodically, increase the fee, but the amount of the fee shall not exceed that which is reasonable and necessary to satisfy its costs in complying with its duties under this title to regulate credit services organizations. The application shall contain all of the following information:(1) The name and address where business is actually conducted of the credit services organization.(2) The names, addresses, and drivers license numbers of any and all persons who directly or indirectly own or control 10 percent or more of the outstanding shares of stock in the credit services organization.(3) Either of the following:(A) A full and complete disclosure of any litigation commenced against the credit services organization or any resolved or unresolved complaint that relates to the operation of the credit services organization and that is filed with the Department of Financial Protection and Innovation, the Attorney General, or any other governmental authority of this state, any other state, or the federal government. With respect to each resolved complaint identified by the disclosure, the disclosure shall include a brief description of the resolution.(B) An acknowledged declaration under penalty of perjury stating that no litigation has been commenced and no unresolved complaint relating to the operation of the organization has been filed with the Department of Financial Protection and Innovation, the Attorney General, or any other governmental authority of this state, any other state, or the federal government.(4) Other information that the Department of Financial Protection and Innovation requires, either at the time of application or thereafter.(b) The Department of Financial Protection and Innovation may conduct an investigation to verify the accuracy of the licensure application. If the application involves investigation outside this state, the applicant credit services organization may be required by the Department of Financial Protection and Innovation to advance sufficient funds to pay the actual expenses of the investigation. Any nonresident applying for licensure under this section shall designate and maintain a resident of this state as the applicants agent for the purpose of receipt of service of process.(c) Each credit services organization shall notify the Department of Financial Protection and Innovation in writing within 30 days after the date of a change in the information required by subdivision (a), except that 30 days advance notice and approval by the Department of Financial Protection and Innovation shall be required before changing the corporate name or address, or persons owning more than 10 percent of the shares of stock in the organization. Each credit services organization applying for licensure under this section may use no more than one fictitious or trade name and shall maintain a copy of the license application in its files. The organization shall allow a buyer to inspect the license application upon request.(d) A license issued pursuant to this section shall expire one year after it was issued, but may be renewed by filing a renewal application accompanied by a fee in an amount to be determined annually by the Department of Financial Protection and Innovation as is reasonable and necessary to satisfy its costs in complying with its duties under this title to regulate credit services organizations. The Department of Financial Protection and Innovation may, periodically, increase the fee, but the amount of the fee shall not exceed that which is reasonable and necessary to satisfy its costs in complying with its duties under this title to regulate credit services organizations.(e) The credit services organization shall attach to the license statement a copy of the contract or contracts which the credit services organization intends to execute with its customers and a copy of the required bond.(f) The Department of Financial Protection and Innovation shall not issue a license under this title to any person who has engaged in, or proposes to engage in, any activity that is in violation of Section 1789.13, any law prohibiting the use of untrue or misleading statements, or any law related to the extension of credit to persons for personal, family, or household purposes.(g) The Department of Financial Protection and Innovation shall maintain on a publicly available internet website a list of the credit services organizations that are licensed in this state.(h) This section shall become operative on January 1, 2023. |
|---|
| 1533 | 1511 | | |
|---|
| 1534 | 1512 | | 1789.25. (a) Every credit services organization shall file an application for licensure with, and receive a license from, the Department of Financial Protection and Innovation before conducting business in this state. The Department of Financial Protection and Innovation shall not issue a license until the bond required by Section 1789.18 has been filed with the Office of the Secretary of State and the department establishes that the organization seeking a license satisfies the requirements of subdivision (f). The application shall be accompanied by a license fee of one hundred dollars ($100). The Department of Financial Protection and Innovation may, periodically, increase the fee, but the amount of the fee shall not exceed that which is reasonable and necessary to satisfy its costs in complying with its duties under this title to regulate credit services organizations. The application shall contain all of the following information:(1) The name and address where business is actually conducted of the credit services organization.(2) The names, addresses, and drivers license numbers of any and all persons who directly or indirectly own or control 10 percent or more of the outstanding shares of stock in the credit services organization.(3) Either of the following:(A) A full and complete disclosure of any litigation commenced against the credit services organization or any resolved or unresolved complaint that relates to the operation of the credit services organization and that is filed with the Department of Financial Protection and Innovation, the Attorney General, or any other governmental authority of this state, any other state, or the federal government. With respect to each resolved complaint identified by the disclosure, the disclosure shall include a brief description of the resolution.(B) An acknowledged declaration under penalty of perjury stating that no litigation has been commenced and no unresolved complaint relating to the operation of the organization has been filed with the Department of Financial Protection and Innovation, the Attorney General, or any other governmental authority of this state, any other state, or the federal government.(4) Other information that the Department of Financial Protection and Innovation requires, either at the time of application or thereafter.(b) The Department of Financial Protection and Innovation may conduct an investigation to verify the accuracy of the licensure application. If the application involves investigation outside this state, the applicant credit services organization may be required by the Department of Financial Protection and Innovation to advance sufficient funds to pay the actual expenses of the investigation. Any nonresident applying for licensure under this section shall designate and maintain a resident of this state as the applicants agent for the purpose of receipt of service of process.(c) Each credit services organization shall notify the Department of Financial Protection and Innovation in writing within 30 days after the date of a change in the information required by subdivision (a), except that 30 days advance notice and approval by the Department of Financial Protection and Innovation shall be required before changing the corporate name or address, or persons owning more than 10 percent of the shares of stock in the organization. Each credit services organization applying for licensure under this section may use no more than one fictitious or trade name and shall maintain a copy of the license application in its files. The organization shall allow a buyer to inspect the license application upon request.(d) A license issued pursuant to this section shall expire one year after it was issued, but may be renewed by filing a renewal application accompanied by a fee in an amount to be determined annually by the Department of Financial Protection and Innovation as is reasonable and necessary to satisfy its costs in complying with its duties under this title to regulate credit services organizations. The Department of Financial Protection and Innovation may, periodically, increase the fee, but the amount of the fee shall not exceed that which is reasonable and necessary to satisfy its costs in complying with its duties under this title to regulate credit services organizations.(e) The credit services organization shall attach to the license statement a copy of the contract or contracts which the credit services organization intends to execute with its customers and a copy of the required bond.(f) The Department of Financial Protection and Innovation shall not issue a license under this title to any person who has engaged in, or proposes to engage in, any activity that is in violation of Section 1789.13, any law prohibiting the use of untrue or misleading statements, or any law related to the extension of credit to persons for personal, family, or household purposes.(g) The Department of Financial Protection and Innovation shall maintain on a publicly available internet website a list of the credit services organizations that are licensed in this state.(h) This section shall become operative on January 1, 2023. |
|---|
| 1535 | 1513 | | |
|---|
| 1536 | 1514 | | 1789.25. (a) Every credit services organization shall file an application for licensure with, and receive a license from, the Department of Financial Protection and Innovation before conducting business in this state. The Department of Financial Protection and Innovation shall not issue a license until the bond required by Section 1789.18 has been filed with the Office of the Secretary of State and the department establishes that the organization seeking a license satisfies the requirements of subdivision (f). The application shall be accompanied by a license fee of one hundred dollars ($100). The Department of Financial Protection and Innovation may, periodically, increase the fee, but the amount of the fee shall not exceed that which is reasonable and necessary to satisfy its costs in complying with its duties under this title to regulate credit services organizations. The application shall contain all of the following information:(1) The name and address where business is actually conducted of the credit services organization.(2) The names, addresses, and drivers license numbers of any and all persons who directly or indirectly own or control 10 percent or more of the outstanding shares of stock in the credit services organization.(3) Either of the following:(A) A full and complete disclosure of any litigation commenced against the credit services organization or any resolved or unresolved complaint that relates to the operation of the credit services organization and that is filed with the Department of Financial Protection and Innovation, the Attorney General, or any other governmental authority of this state, any other state, or the federal government. With respect to each resolved complaint identified by the disclosure, the disclosure shall include a brief description of the resolution.(B) An acknowledged declaration under penalty of perjury stating that no litigation has been commenced and no unresolved complaint relating to the operation of the organization has been filed with the Department of Financial Protection and Innovation, the Attorney General, or any other governmental authority of this state, any other state, or the federal government.(4) Other information that the Department of Financial Protection and Innovation requires, either at the time of application or thereafter.(b) The Department of Financial Protection and Innovation may conduct an investigation to verify the accuracy of the licensure application. If the application involves investigation outside this state, the applicant credit services organization may be required by the Department of Financial Protection and Innovation to advance sufficient funds to pay the actual expenses of the investigation. Any nonresident applying for licensure under this section shall designate and maintain a resident of this state as the applicants agent for the purpose of receipt of service of process.(c) Each credit services organization shall notify the Department of Financial Protection and Innovation in writing within 30 days after the date of a change in the information required by subdivision (a), except that 30 days advance notice and approval by the Department of Financial Protection and Innovation shall be required before changing the corporate name or address, or persons owning more than 10 percent of the shares of stock in the organization. Each credit services organization applying for licensure under this section may use no more than one fictitious or trade name and shall maintain a copy of the license application in its files. The organization shall allow a buyer to inspect the license application upon request.(d) A license issued pursuant to this section shall expire one year after it was issued, but may be renewed by filing a renewal application accompanied by a fee in an amount to be determined annually by the Department of Financial Protection and Innovation as is reasonable and necessary to satisfy its costs in complying with its duties under this title to regulate credit services organizations. The Department of Financial Protection and Innovation may, periodically, increase the fee, but the amount of the fee shall not exceed that which is reasonable and necessary to satisfy its costs in complying with its duties under this title to regulate credit services organizations.(e) The credit services organization shall attach to the license statement a copy of the contract or contracts which the credit services organization intends to execute with its customers and a copy of the required bond.(f) The Department of Financial Protection and Innovation shall not issue a license under this title to any person who has engaged in, or proposes to engage in, any activity that is in violation of Section 1789.13, any law prohibiting the use of untrue or misleading statements, or any law related to the extension of credit to persons for personal, family, or household purposes.(g) The Department of Financial Protection and Innovation shall maintain on a publicly available internet website a list of the credit services organizations that are licensed in this state.(h) This section shall become operative on January 1, 2023. |
|---|
| 1537 | 1515 | | |
|---|
| 1538 | 1516 | | |
|---|
| 1539 | 1517 | | |
|---|
| 1540 | 1518 | | 1789.25. (a) Every credit services organization shall file an application for licensure with, and receive a license from, the Department of Financial Protection and Innovation before conducting business in this state. The Department of Financial Protection and Innovation shall not issue a license until the bond required by Section 1789.18 has been filed with the Office of the Secretary of State and the department establishes that the organization seeking a license satisfies the requirements of subdivision (f). The application shall be accompanied by a license fee of one hundred dollars ($100). The Department of Financial Protection and Innovation may, periodically, increase the fee, but the amount of the fee shall not exceed that which is reasonable and necessary to satisfy its costs in complying with its duties under this title to regulate credit services organizations. The application shall contain all of the following information: |
|---|
| 1541 | 1519 | | |
|---|
| 1542 | 1520 | | (1) The name and address where business is actually conducted of the credit services organization. |
|---|
| 1543 | 1521 | | |
|---|
| 1544 | 1522 | | (2) The names, addresses, and drivers license numbers of any and all persons who directly or indirectly own or control 10 percent or more of the outstanding shares of stock in the credit services organization. |
|---|
| 1545 | 1523 | | |
|---|
| 1546 | 1524 | | (3) Either of the following: |
|---|
| 1547 | 1525 | | |
|---|
| 1548 | 1526 | | (A) A full and complete disclosure of any litigation commenced against the credit services organization or any resolved or unresolved complaint that relates to the operation of the credit services organization and that is filed with the Department of Financial Protection and Innovation, the Attorney General, or any other governmental authority of this state, any other state, or the federal government. With respect to each resolved complaint identified by the disclosure, the disclosure shall include a brief description of the resolution. |
|---|
| 1549 | 1527 | | |
|---|
| 1550 | 1528 | | (B) An acknowledged declaration under penalty of perjury stating that no litigation has been commenced and no unresolved complaint relating to the operation of the organization has been filed with the Department of Financial Protection and Innovation, the Attorney General, or any other governmental authority of this state, any other state, or the federal government. |
|---|
| 1551 | 1529 | | |
|---|
| 1552 | 1530 | | (4) Other information that the Department of Financial Protection and Innovation requires, either at the time of application or thereafter. |
|---|
| 1553 | 1531 | | |
|---|
| 1554 | 1532 | | (b) The Department of Financial Protection and Innovation may conduct an investigation to verify the accuracy of the licensure application. If the application involves investigation outside this state, the applicant credit services organization may be required by the Department of Financial Protection and Innovation to advance sufficient funds to pay the actual expenses of the investigation. Any nonresident applying for licensure under this section shall designate and maintain a resident of this state as the applicants agent for the purpose of receipt of service of process. |
|---|
| 1555 | 1533 | | |
|---|
| 1556 | 1534 | | (c) Each credit services organization shall notify the Department of Financial Protection and Innovation in writing within 30 days after the date of a change in the information required by subdivision (a), except that 30 days advance notice and approval by the Department of Financial Protection and Innovation shall be required before changing the corporate name or address, or persons owning more than 10 percent of the shares of stock in the organization. Each credit services organization applying for licensure under this section may use no more than one fictitious or trade name and shall maintain a copy of the license application in its files. The organization shall allow a buyer to inspect the license application upon request. |
|---|
| 1557 | 1535 | | |
|---|
| 1558 | 1536 | | (d) A license issued pursuant to this section shall expire one year after it was issued, but may be renewed by filing a renewal application accompanied by a fee in an amount to be determined annually by the Department of Financial Protection and Innovation as is reasonable and necessary to satisfy its costs in complying with its duties under this title to regulate credit services organizations. The Department of Financial Protection and Innovation may, periodically, increase the fee, but the amount of the fee shall not exceed that which is reasonable and necessary to satisfy its costs in complying with its duties under this title to regulate credit services organizations. |
|---|
| 1559 | 1537 | | |
|---|
| 1560 | 1538 | | (e) The credit services organization shall attach to the license statement a copy of the contract or contracts which the credit services organization intends to execute with its customers and a copy of the required bond. |
|---|
| 1561 | 1539 | | |
|---|
| 1562 | 1540 | | (f) The Department of Financial Protection and Innovation shall not issue a license under this title to any person who has engaged in, or proposes to engage in, any activity that is in violation of Section 1789.13, any law prohibiting the use of untrue or misleading statements, or any law related to the extension of credit to persons for personal, family, or household purposes. |
|---|
| 1563 | 1541 | | |
|---|
| 1564 | 1542 | | (g) The Department of Financial Protection and Innovation shall maintain on a publicly available internet website a list of the credit services organizations that are licensed in this state. |
|---|
| 1565 | 1543 | | |
|---|
| 1566 | 1544 | | (h) This section shall become operative on January 1, 2023. |
|---|
| 1567 | 1545 | | |
|---|
| 1568 | 1546 | | SEC. 47. The Legislature finds and declares that Section 30 of this act, which adds Section 1789.12.35 of the Civil Code, imposes a limitation on the publics right of access to the meetings of public bodies or the writings of public officials and agencies within the meaning of Section 3 of Article I of the California Constitution. Pursuant to that constitutional provision, the Legislature makes the following findings to demonstrate the interest protected by this limitation and the need for protecting that interest:Protecting from public disclosure limited confidential information provided by licensees to the Commissioner of the Department of Financial Protection and Innovation properly balances protecting legitimate private economic interests and public interests in effective regulation. |
|---|
| 1569 | 1547 | | |
|---|
| 1570 | 1548 | | SEC. 47. The Legislature finds and declares that Section 30 of this act, which adds Section 1789.12.35 of the Civil Code, imposes a limitation on the publics right of access to the meetings of public bodies or the writings of public officials and agencies within the meaning of Section 3 of Article I of the California Constitution. Pursuant to that constitutional provision, the Legislature makes the following findings to demonstrate the interest protected by this limitation and the need for protecting that interest:Protecting from public disclosure limited confidential information provided by licensees to the Commissioner of the Department of Financial Protection and Innovation properly balances protecting legitimate private economic interests and public interests in effective regulation. |
|---|
| 1571 | 1549 | | |
|---|
| 1572 | 1550 | | SEC. 47. The Legislature finds and declares that Section 30 of this act, which adds Section 1789.12.35 of the Civil Code, imposes a limitation on the publics right of access to the meetings of public bodies or the writings of public officials and agencies within the meaning of Section 3 of Article I of the California Constitution. Pursuant to that constitutional provision, the Legislature makes the following findings to demonstrate the interest protected by this limitation and the need for protecting that interest: |
|---|
| 1573 | 1551 | | |
|---|
| 1574 | 1552 | | ### SEC. 47. |
|---|
| 1575 | 1553 | | |
|---|
| 1576 | 1554 | | Protecting from public disclosure limited confidential information provided by licensees to the Commissioner of the Department of Financial Protection and Innovation properly balances protecting legitimate private economic interests and public interests in effective regulation. |
|---|
| 1577 | 1555 | | |
|---|
| 1578 | 1556 | | SEC. 48. No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIIIB of the California Constitution. |
|---|
| 1579 | 1557 | | |
|---|
| 1580 | 1558 | | SEC. 48. No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIIIB of the California Constitution. |
|---|
| 1581 | 1559 | | |
|---|
| 1582 | 1560 | | SEC. 48. No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIIIB of the California Constitution. |
|---|
| 1583 | 1561 | | |
|---|
| 1584 | 1562 | | ### SEC. 48. |
|---|