BILL NUMBER: AB 1877	CHAPTERED
	BILL TEXT

	CHAPTER  476
	FILED WITH SECRETARY OF STATE  SEPTEMBER 23, 2012
	APPROVED BY GOVERNOR  SEPTEMBER 23, 2012
	PASSED THE SENATE  AUGUST 23, 2012
	PASSED THE ASSEMBLY  AUGUST 28, 2012
	AMENDED IN SENATE  AUGUST 21, 2012
	AMENDED IN ASSEMBLY  APRIL 24, 2012
	AMENDED IN ASSEMBLY  APRIL 10, 2012
	AMENDED IN ASSEMBLY  MARCH 29, 2012
	AMENDED IN ASSEMBLY  MARCH 19, 2012

INTRODUCED BY   Assembly Members Ma and Olsen

                        FEBRUARY 22, 2012

   An act to amend, repeal, and add Section 7500.3 of the Business
and Professions Code, relating to repossessors.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 1877, Ma. Repossession agencies: exemptions.
    Existing law, the Collateral Recovery Act, provides for the
licensure and regulation of repossession agencies by the Bureau of
Security and Investigative Services under the supervision and control
of the Director of Consumer Affairs. A violation of the act is a
misdemeanor. The act provides that a repossession agency does not
include the legal owner of collateral that is subject to a security
agreement or a bona fide employee of the legal owner of collateral
that is subject to a security agreement.
   This bill would, until January 1, 2018, add that a repossession
agency does not include a dealer regularly engaged in the sale of
specified collateral that is subject to a specified security
agreement, and that dealer's bona fide employees, provided that
specified requirements are met. The bill would also prohibit, until
January 1, 2018, the dealer, its bona fide employees, and other
specified entities from instructing, coercing, or attempting to
coerce another person to violate laws, regulations, and rules
regarding the recovery of collateral, as specified. Because a
violation of this prohibition would be a crime, the bill would impose
a state-mandated local program.
   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.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 7500.3 of the Business and Professions Code is
amended to read:
   7500.3.  (a) A repossession agency shall not include any of the
following:
   (1) Any bank subject to the jurisdiction of the Commissioner of
Financial Institutions of the State of California under Division 1
(commencing with Section 99) of the Financial Code or the Comptroller
of the Currency of the United States.
   (2) Any person organized, chartered, or holding a license or
authorization certificate to make loans pursuant to the laws of this
state or the United States who is subject to supervision by any
official or agency of this state or the United States.
   (3) An attorney at law in performing his or her duties as an
attorney at law.
   (4) The legal owner of collateral that is subject to a security
agreement; or a bona fide employee employed exclusively and regularly
by the legal owner of collateral that is subject to a security
agreement. With regard to collateral subject to registration under
the Vehicle Code, the legal owner shall be the legal owner listed on
the records of the Department of Motor Vehicles or the seller or
lessor named on a valid conditional sales contract or rental or lease
agreement if the seller or lessor is a licensed vehicle dealer as
defined in Section 285 of the Vehicle Code.
   (5) An officer or employee of the United States of America, or of
this state or a political subdivision thereof, while the officer or
employee is engaged in the performance of his or her official duties.

   (6) A qualified certificate holder or a registrant when performing
services for, or on behalf of, a licensee.
   (7) A dealer, including its bona fide employees, regularly engaged
in the sale of collateral designed primarily for agricultural use,
as defined in subdivision (b) of Section 51201 of the Government
Code, for use in the care of lawns and gardens, or for use as special
construction equipment, as defined in subdivision (b) of Section 565
of the Vehicle Code, or for use in the production, generation,
storage, or transmission of mechanical or electric energy, that is
subject to a security agreement of the manufacturer or an affiliate
of that manufacturer, provided the following requirements are met:
   (A) The dealer or the secured party maintains adequate records of
all repossessions.
   (B) The dealer or the secured party completes a collateral
condition report.
   (C) The dealer or the secured party records any odometer or hour
meter readings.
   (D) The dealer or the secured party creates records of all
transactions pertaining to the sale of the collateral, including, but
not limited to, bids solicited and received, cash received,
remittances to the seller, and allocation of any moneys not so
remitted to appropriate ledger accounts.
   (E) The dealer removes and stores any personal effects that were
taken with the collateral for a minimum of 60 days in a secure
manner, completes an inventory of the personal effects, and notes the
date that inventory is taken.
   (F) If personal effects that were taken with the collateral are to
be released to someone other than the debtor, the dealer shall
request written authorization to do so from the debtor. The dealer
may dispose of personal effects after storing them for at least 60
days pursuant to subparagraph (E).
   (b) Entities described in paragraph (7) of subdivision (a), or a
debtor, lienholder, lessor or lessee, or an agent thereof shall not
by any means, directly or indirectly, expressed or implied, instruct,
coerce, or attempt to coerce another person to violate any law,
regulation, or rule regarding the recovery of collateral, including,
but not limited to, the provisions of this chapter or Section 9609 of
the Commercial Code.
   (c) This section shall remain in effect only until January 1,
2018, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2018, deletes or extends
that date.
  SEC. 2.  Section 7500.3 is added to the Business and Professions
Code, to read:
   7500.3.  A repossession agency shall not include any of the
following:
   (a) Any bank subject to the jurisdiction of the Commissioner of
Financial Institutions of the State of California under Division 1
(commencing with Section 99) of the Financial Code or the Comptroller
of the Currency of the United States.
   (b) Any person organized, chartered, or holding a license or
authorization certificate to make loans pursuant to the laws of this
state or the United States who is subject to supervision by any
official or agency of this state or the United States.
   (c) An attorney at law in performing his or her duties as an
attorney at law.
   (d) The legal owner of collateral that is subject to a security
agreement or a bona fide employee employed exclusively and regularly
by the legal owner of collateral that is subject to a security
agreement. With regard to collateral subject to registration under
the Vehicle Code, the legal owner shall be the legal owner listed on
the records of the Department of Motor Vehicles or the seller or
lessor named on a valid conditional sales contract or rental or lease
agreement if the seller or lessor is a licensed vehicle dealer as
defined in Section 285 of the Vehicle Code.
   (e) An officer or employee of the United States of America, or of
this state or a political subdivision thereof, while the officer or
employee is engaged in the performance of his or her official duties.

   (f) A qualified certificate holder or a registrant when performing
services for, or on behalf of, a licensee.
   (g) This section shall become operative on January 1, 2018.
  SEC. 3.  No reimbursement is required by this act pursuant to
Section 6 of Article XIII B 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 XIII B of the California
Constitution.