BILL NUMBER: SB 365	AMENDED
	BILL TEXT

	AMENDED IN SENATE  APRIL 13, 2011
	AMENDED IN SENATE  APRIL 5, 2011

INTRODUCED BY   Senator Lowenthal

                        FEBRUARY 15, 2011

   An act to amend  Sections 23001 and 23035 of, and to add
Section 23024.5 to,   Section 23036 of  the
Financial Code, relating to deferred deposit transactions.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 365, as amended, Lowenthal. Deferred deposit 
transactions: database: transaction recision.  
transactions. 
   Existing law, the California Deferred Deposit Transaction Law,
provides for the licensure and regulation by the Commissioner of
Corporations of persons engaged in the business of making or
negotiating deferred deposit transactions, as defined. 
Existing law authorizes a licensee to defer the deposit of a customer'
s personal check for up to 31 days and provides that the face amount
of the check shall not exceed $300.  Existing law requires
an agreement to enter into a deferred deposit transaction to be in
writing and to include specified information and disclosures. 
Existing law provides that a licensee shall not enter into an
agreement for a deferred deposit transaction with a customer during
the period of time that an earlier written agreement for a deferred
deposit transaction for the same customer   is in effect.
 A willful violation of the California Deferred Deposit
Transaction Law is a crime.
   This bill would  require   declare the intent
of the Legislature to enact legislation that would authorize 
the commissioner to  implement a database that enables a
licensee to receive specified information regarding a consumer's
history with deferred deposit transactions. The bill would require
the commissioner to implement the database on or before September 1,
2012, unless specified conditions exist that do not allow for the
implementation. The bill would authorize the commissioner to contract
with a 3rd-party provider to operate the database. The bill would
authorize the commissioner to adopt rules to establish the database
and for the retention, archiving, and deletion of the information
entered into, or stored by, the database. The bill would authorize
the commissioner to impose a fee on licensees for the reasonable
regulatory costs of the commissioner associated with the
administration of the database, as specified. The bill would impose
various requirements on licensees relative to information that would
be required to be reported to the database, if it is developed and
implemented. The bill would also authorize customers to rescind a
deferred deposit transaction at no cost if the customer notifies the
licensee of the intent to rescind and returns the proceeds of the
transaction, as specified, and would require certain disclosures in
that regard. Because a willful violation of these requirements by a
licensee would be a crime under the California Deferred Deposit
Transaction Law, the bill would impose a state-mandated local program
  contract with a qualified 3rd-party provider for the
implementation of a database to aid in the enforcement of the
California Deferred Deposit Transaction Law. The bill would also
clarify that a licensee shall not enter into an agreement for a
deferred deposit transaction with a customer during the period of
time that an earlier written agreement for a deferred deposit
transaction for the same customer is in effect with any licensee
 . 
   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. 
   Vote: majority. Appropriation: no. Fiscal committee:  yes
  no  . State-mandated local program:  yes
  no  .


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

   SECTION 1.    It is the intent of the Legislature to
enact legislation that would authorize the Commissioner of
Corporations to contract with a qualified third-party provider for
the implementation of a common database with real-time access through
an Internet connection for licensees, as defined in Section 23001 of
the Financial Code, to aid in the enforcement of the California
Deferred Deposit Transaction Law. 
   SEC. 2.    Section 23036 of the   Financial
Code   is amended to read: 
   23036.  (a) A fee for a deferred deposit transaction shall not
exceed 15 percent of the face amount of the check.
   (b) A licensee may allow an extension of time, or a payment plan,
for repayment of an existing deferred deposit transaction but may not
charge any additional fee or charge of any kind in conjunction with
the extension or payment plan. A licensee that complies with the
provisions of this subdivision shall not be deemed to be in violation
of subdivision (g) of Section 23037.
   (c) A licensee shall not enter into an agreement for a deferred
deposit transaction with a customer during the period of time that an
earlier written agreement for a deferred deposit transaction for the
same customer is in effect  with any licensee  .
   (d) A licensee who enters into a deferred deposit transaction
agreement, or any assignee of that licensee, shall not be entitled to
recover damages for that transaction in any action brought pursuant
to, or governed by, Section 1719 of the Civil Code.
   (e) A fee not to exceed fifteen dollars ($15) may be charged for
the return of a dishonored check by a depositary institution in a
deferred deposit transaction. A single fee charged pursuant to this
subdivision is the exclusive charge for a dishonored check. No fee
may be added for late payment.
   (f) No amount in excess of the amounts authorized by this section
shall be directly or indirectly charged by a licensee pursuant to a
deferred deposit transaction.
   (g) A licensee shall be subject to the provisions of Title 1.6C
(commencing with Section 1788) of Part 4 of Division 3 of the Civil
Code. All matter omitted in this version of the bill appears in the
bill as amended in the Senate, April 5, 2011. (JR11)