BILL ANALYSIS Ó
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|Hearing Date:August 19, 2013 |Bill No:AB |
| |1159 |
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SENATE COMMITTEE ON BUSINESS, PROFESSIONS
AND ECONOMIC DEVELOPMENT
Senator Ted W. Lieu, Chair
Bill No: AB 1159Author:Gonzalez
As Amended:August 15, 2013 Fiscal:Yes
SUBJECT: Immigration services.
SUMMARY: An urgency measure which provides that it is the unlicensed
practice of law for an immigration consultant, or any person who is
not an attorney, to literally translate, from English into another
language, in written documents or advertisements, the term "notary
public," or any other term that implies that the person is an
attorney; requires attorneys who provide immigration reform act
services to use a written contract in English and in the client's
native language which contains specified elements; prohibits an
attorney or an immigration consultant from demanding or accepting the
advance payment of any funds from a person for immigration reform act
services before the enactment of any immigration reform act; requires
immigration consultants to place client funds into a trust account;
and, increases the bond required by an immigration consultant to
$100,000.
Existing law:
1)The State Bar Act licenses and regulates attorneys by the State Bar
of California (State Bar). (Business and Professions Code (BPC) §
6000 et seq.)
2) Prohibits the practice of law in California by any person who is
not an active member of the State Bar. Further provides that any
person advertising or holding out as practicing, entitled to, or
otherwise practicing law, who is not an active member of the State
Bar, or otherwise authorized pursuant to statute or court rule to
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practice law, is guilty of a misdemeanor punishable by up to one
year imprisonment or by a fine of up to $1,000, or by both. A
second or subsequent conviction requires a sentence of not less
than 90 days in jail, except as provided. (BPC §§ 6125, 6126)
3)Regulates a person engaged in the business or acting in the capacity
of an immigration consultant, and provides that a violation of these
provisions is a crime. (BPC § 22440 et seq.)
4)Defines "immigration consultant" as a person giving non-legal
assistance or advice on an immigration matter, such as completing
forms, translating answers, securing forms, making referrals, or
submitting forms. (BPC § 22441)
5)Requires an immigration consultant to satisfactorily pass a
background check conducted by the Secretary of State, and requires
the Secretary of State to disqualify an individual from
acting as an immigration consultant who does not meet certain specified
requirements.
(BPC § 22441.1)
6)Requires immigration consultants to provide a client, in the client's
native language, a written contract with certain contract language
requirements and restrictions prescribed by the Department of
Consumer Affairs regulations, and exempts from this requirement
employees of a nonprofit, tax-exempt corporation who provide certain
free or low-cost services.
(BPC § 22242)
7)Requires immigration consultants to provide a client with payment
receipts, as well as statements of services and payments every two
months. (BPC § 22442.1)
8)Requires immigration consultants to visibly display certain
information, such as evidence of compliance with the bonding
requirement, a statement that the immigration consultant is not an
attorney, fee information, and to provide similar written
information to clients prior to providing services. (BPC § 22442.2)
9)Requires an immigration consultant to clearly identify that he/she is
not an attorney.
(BPC § 22442 (b) (3))
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10)Prohibits an immigration consultant from literally translating, with
the intent to mislead, from English into another language, words or
titles including, but not limited to, "notary public," "notary,"
"licensed," "attorney," "lawyer," or any term that might imply that
the person is an attorney in any document, including an
advertisement, stationery, letterhead, business card, or other
comparable written material describing the immigration consultant.
(BPC § 22442.3)
11)Requires all immigration consultants to file a $50,000 surety bond,
related disclosure form, and other specified information with the
Secretary of State, and to file and routinely update additional
business information with the Secretary of State, and allows the
Secretary of State to charge a fee to cover the costs of filing and
maintaining the bond. (BPC § 22443.1)
12)Makes a violation of the immigration consultant requirements subject
to a civil penalty not to exceed $100,000 for each violation and a
misdemeanor punishable by a fine of $2,000 to $10,000 per client
and/or up to one year imprisonment. Makes a second or subsequent
violation for certain provisions a felony. (BPC § 22445)
13)Prohibits a notary public (who is not an attorney) from making the
literal translation of the phrase "notary public" into Spanish
"notario publico" or "notario" and provides for suspension or
revocation of the commission of any notary public who fails to
comply with that prohibition. (Government Code § 8219.5)
This bill:
1)Makes it a violation of the laws prohibiting the unauthorized
practice of law for any person who is not an attorney to literally
translate from English into another language, in any document,
including an advertisement, stationery, letterhead, business card,
or other comparable written material, any words or titles,
including, but not limited to, "notary public," "notary,"
"licensed," "attorney," or "lawyer," to imply that the person is an
attorney, and expressly prohibits the literal translation of the
phrase "notary public" into Spanish as "notrario publico" or
"notario."
2)Adds a specified body of law to the State Bar Act relating to
"Attorneys Providing Immigration Services."
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3)Defines certain terms for purposes of the article:
a) "Immigration reform act" means any pending or future act of
Congress that is enacted after the effective date of this bill
but before January 1, 2017, including but not limited to, the
federal act known as the "Border Security, Economic Opportunity,
and Immigration Modernization Act" (S. 744, 2013), which
authorizes an undocumented immigrant, who either entered the
United States without inspection or who did not depart after
expiration of a nonimmigrant visa, to attain a lawful status
under federal law.
b) "Immigration reform act services" means the services necessary
in the preparation of an application and other related initial
processes in order for an undocumented immigrant, who either
entered the United States without inspection or who did not
depart after expiration of a nonimmigrant visa, to attain a
lawful status under an immigration reform act.
1)Specifies that these provisions shall apply to:
a) An attorney who is an active member of the State Bar who
provides immigration reform act services.
b) An attorney who is not a member of the State Bar, but who is
authorized to practice law or authorized by federal law to
represent persons before the Board of Immigration Appeals or the
United States Citizenship and Immigration Services, and who is
providing immigration reform act services in an office or
business in California.
1)Prohibits an attorney from demanding or accepting the advance payment
of any funds from a person for immigration reform act services
before the enactment of an immigration reform act, and provides that
any funds received after the effective date of the bill, but before
the enactment of an immigration reform act, shall be refunded to the
client.
2)Provides that if an attorney providing immigration reform act
services accepted funds prior to the effective date of these
provisions, and the services were provided, the attorney shall
provide the client with a statement of accounting describing the
services rendered. Any funds received before the effective date of
the bill, but before the enactment of an immigration reform act,
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shall be deposited into a client trust account. An attorney that
deposits funds into a client trust account shall provide the client
a written notice in English and in the client's native language,
that no benefits or relief is available, and that an application may
not be processed until the enactment of an immigration reform act,
as specified.
3)Requires upon the enactment of an immigration reform act, an attorney
providing immigration reform act services, prior to providing those
services, to provide the client with a written contract which
includes all of the following:
a) A description explaining the services the attorney anticipates
will be performed.
b) The basis of compensation for each service described,
including hourly rate, statutory fees, flat fees, and other
applicable charges.
c) A statement informing the client that complaints may be
reported to the Office of Immigrant Assistance of the Department
of Justice, to the State Bar, or the bar of the court of any
state or jurisdiction where the attorney is admitted to practice
law. The statement shall include the toll-free telephone numbers
and Internet Web sites of those entities.
1)Requires the written contract to be in English and the client's
native language, provided that:
a) Upon the consent of the client, the contract need not be
written in English, and may instead be written in the client's
native language or another language the client understands.
b) For unwritten languages or extremely rare or uncommon
languages, the contract shall be written in English and orally
translated to the client in the language the client can
understand.
c) Makes a contract void if it does not comply with the language
provisions.
1)Requires that the written contract of an immigration consultant
contain additional information, including: an itemization of each
service to be performed; an explanation of the purpose and process
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of each service; and the cost of preparing each document specified
in the contract.
2)Specifies that an immigration consultant who literally translates,
from English into another language, the words or titles, including,
but not limited to, "notary public," "notary," "licensed,"
"attorney," "lawyer," or any other terms that imply that the person
is an attorney, shall constitute the unlicensed practice of law, as
specified. Establishes, in addition to any other remedy, a civil
penalty of up to $1,000 per day for each violation of this
provision, as specified.
3)Requires an immigration consultant, who provides immigration reform
act services to a client, to establish and deposit into a client
trust account any funds received from the client prior to performing
services for that client, and imposes certain requirements relating
to the expenditure of funds from the trust account.
4)Defines certain terms relating to immigration consultants who perform
immigration reform act services:
a) "Immigration reform act" means any pending or future act of
Congress that is enacted after the effective date of the bill but
before January 1, 2017, including but not limited to the federal
act known as the "Border Security, Economic Opportunity, and
Immigration Modernization Act" (S. 744, 2013), that authorizes an
undocumented immigrant who either entered the United States
without inspection or who did not depart after expiration of a
nonimmigrant visa, to attain a lawful status under federal law.
b) "Immigration reform act services" means the services of an
immigration consultant, as described, that are provided in
connection with an immigration reform act.
1)Prohibits an immigration consultant from demanding or accepting the
advance payment of any funds from a person for immigration reform
act services before the enactment of an immigration reform act, as
defined, and requires any funds received after the effective date of
the bill, but before the enactment of an immigration reform act, to
be refunded to the client. Any funds received before the effective
date of the bill, but before the enactment of the immigration reform
act shall be deposited into a client trust account or refunded to
the client.
2)Provides that if an immigration consultant providing immigration
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reform act services accepted funds prior to the effective date of
these provisions, and the services were provided, the consultant
shall provide the client with a statement of accounting describing
the services rendered. Any funds received before the effective date
of the bill, but before the enactment of an immigration reform act
shall either be refunded to the client or deposited into a client
trust account. An immigration consultant deposits funds into a
client trust account shall provide the client a written notice in
English and in the client's native language, that no benefits or
relief is available, and that no application may be processed until
the enactment of an immigration reform act, as specified.
Establishes, in addition to any other remedy, a civil penalty of up
to $1,000 per day for each violation of this provision, as
specified.
3)Increases the amount of the required bond from $50,000 to $100,000
for all immigration consultants; operative180 days after the bill
becomes effective
4)Provides that the bill shall take effect immediately as an urgency
measure.
FISCAL EFFECT: Unknown. This bill has been keyed fiscal by
Legislative Counsel.
COMMENTS:
1.Purpose. This bill is sponsored by the State Bar of California
(State Bar). According to the Author, this bill is a consumer
protection measure that establishes minimum statutory requirements
and regulations through the State Bar for attorneys and non-lawyer
document preparers who offer immigration services under
comprehensive immigration reform. The goal of the bill is to
protect individuals seeking a path to citizenship from fraud and
abuse.
The Author indicates that the key components to the bill are:
" Written Retainer Agreement . The bill will require these
attorneys to provide a client with a written contract, in the
client's language, containing an itemized list, with costs, of
each service to be performed.
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" Prohibits Early Client Solicitation . The bill will make
it unlawful to demand money for services, before the passage by
Congress of immigration reform legislation, and require the
return of fees already collected before the federal legislation
is even enacted.
" Prohibition of use of term "Notario." The legislation
will also clarify that advertising the term "notario," which is
already prohibited except in certain limited situations, would
also constitute an unlawful holding out by a non-lawyer in
violation of the law prohibiting the unauthorized practice of
law.
" Other Non-lawyer Restrictions . Finally, the bill will add
other consumer protections for immigration assistance provided
by non-lawyers.
1.Need For the Bill. According to the Author and the Sponsor, this
measure is proposed in anticipation of federal immigration reform
legislation that is currently pending in Congress, and is intended
to proactively head off problems in implementing immigration reform
measures in California. The Sponsor expresses the need for the
bill as follows:
Immigration Fraud has already begun . We have heard about the
rising tide of fraud in the immigration services arena. We have
read the articles about individuals seeking help who have lost
their original documents to unscrupulous attorneys, who have
been held captive to unreasonable fees, and who may have been
deported as a result of a lawyer's misconduct. These examples
could become a tidal wave of fraud if something is not done
immediately.
Loan modification fraud experience was small by comparison . The
experience with loan modification fraud sheds light on the
magnitude of the problem. The State Bar received over 12,500
complaints of loan modification misconduct, and many of these
victims ended up losing their homes as a result of that fraud.
Should Congress pass immigration reform, the potential scope of
fraud is exponentially higher than the scope of the loan
modification scandal.
Over 2.5 million Californians will probably be subject to the
proposed immigration reform . Tracking past trends, roughly 20
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percent of these individuals (500,000) may be targets of fraud.
Also applying past trends, if 10 percent of the clients targeted
by lawyers under immigration reform complain to the State Bar,
there will be 50,000 new complaints in the lawyer discipline
system. Those clients who file complaints with the Bar due to
lawyer fraud may be entitled to a full refund of their lost
monies from the Client Security Fund (CSF). This fund was
legislatively created in 1971, funded solely by lawyers through
their annual law license renewal fee. Since its inception, it
has reimbursed 100 cents on the dollar for all qualified losses
suffered by clients. Assuming 50,000 qualified applications for
reimbursement from the CSF at an average of $5,000 each, the
impact would be $250 million in claims.
Reducing fraud before it occurs is the goal of AB 1159 . This
legislation is intended to protect vulnerable Californians who
may be able to seek protection as a result of pending federal
immigration reform proposals, but instead, are already the
targets of fraudulent schemes. Through specific restrictions on
both lawyers and non-lawyers providing certain immigration
reform services, the bill is designed to significantly reduce
fraud before it occurs, as well as to provide appropriate
enforcement tools to recover against those individuals who do
engage in fraudulent behavior.
AB 1159 is a reasonable approach to ensure consumer protection
for immigrants . Using common sense business practices as a
guideline, AB 1159 will put in place some reasonable minimum
requirements for the consultants and attorneys hired by
immigrants. By putting in place these safeguards now, we will
prevent the fraud at the front end, avoiding more significant
repercussions down the road.
The urgent need for this bill is demonstrated by the stories of
fraud that we hear about on a daily basis. Bad actors are
making guarantees that they cannot fulfill, and they are taking
fees for services that they cannot possibly provide at this
time. AB 1159 will take California a step closer to bringing a
stop to the growing crisis of immigration services fraud by
curtailing the fraud that is happening right now and providing
adequate law enforcement tools to address the fraud that does
occur.
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2.Border Security, Economic Opportunity, and Immigration Modernization
Act of 2013. Federal legislation, the Border Security, Economic
Opportunity, and Immigration Modernization Act of 2013 (S.744) was
introduced in the United States Senate in April of this year. S.744
is an immigration reform bill introduced by Senator Charles Schumer
of New York and is co-sponsored by a bipartisan group of U.S.
Senators who wrote and negotiated the bill.
One of the key components of S. 744 is to create a path to earned
citizenship to help the estimated 11 million undocumented immigrants
in the United States gain legal status. It would also make changes
to the existing system of legal immigration, attempting to make the
system more responsive to economic needs, and make provisions for
efforts to secure the border of the country. Under the bill,
undocumented immigrants would initially need to apply for a newly
created Registered Provisional Immigrant status; in order to do so
immigrants would have to pay a fine and fees, any back taxes owed,
pass a background check and not have a disqualifying criminal
record. The bill further benefits children of undocumented
immigrants and agricultural workers. The bill would also
drastically alter the methods of visa allocation under current
family-based and employment-based categories, as well as introduce a
new concept of a "merit-based" visa, which awards visas based on
points accrued based on educational achievements, employment
history, and other contributions to society.
The Author states: "[S. 744] will create a pathway to citizenship for
the 2.5 million undocumented immigrants currently residing in
California. This immigration reform will increase the already
enormous need for qualified legal counsel to represent foreign
nationals in immigration proceedings.
"Though individuals in removal proceedings are granted the privilege of
being represented by legal counsel, such representation must be
provided at no expense to the government. The burden of securing
and paying for adequate representation is the responsibility of the
individual seeking immigration services. However, because foreign
nationals have a much greater chance of achieving a favorable
outcome in immigration proceedings if they are represented by
counsel, it is in their best interest to retain the services of an
immigration services professional.
"Beyond the immediate problem of fraudulent behavior, the risks
involved with an unqualified person performing immigration services
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can be profoundly disruptive for the individual seeking legal
immigration help. Simply filing the wrong paperwork with the U.S.
Citizenship and Immigration Services (USCIS) can trigger interviews,
investigations and often deportation proceedings."
3.Related legislation. AB 888 (Dickinson, 2013) requires the State Bar
to disclose, in confidence, the information in its investigation of
an unauthorized practice of law to the agency responsible for
criminal enforcement, and allows the State Bar to request the
Attorney General or other public prosecutor to bring an enforcement
action for the unauthorized practice of law. The bill additionally
allows the State Bar to bring a civil action for any violation of
the existing prohibitions on the unauthorized practice of law, and
requires the court in those actions to impose a civil penalty, to
consider providing relief to any injured party, and award the State
Bar reasonable attorney's fees and costs. ( Status : This bill is
pending action on the Senate Floor.)
4.Prior Legislation. California first enacted its regulation of
immigration consultants in 1986 allowing, under certain conditions
and requirements, non-lawyers to provide immigration consulting
services. The law was a response to a federal amnesty bill that led
to a high volume of citizenship applications and concerns regarding
the unscrupulous practices of immigration consultants. In response
to continuing problems with immigration consulting fraud, the law
has been amended to improve the protections for clients:
AB 2520 (Napolitano, Chapter 561, Statutes of 1994) required
immigration consultants to register with the Department of
Consumer Affairs, increased criminal fines and created new civil
fines and penalties for violations of the law.
AB 3137 (Escutia, Chapter 562, Statutes of 1994) required
consultants to file a surety bond and provide clients with
copies of every document completed on their behalf.
SB 1348 (Senate Business and Professions Committee, Chapter 790,
Statutes of 1997) increased the bonding requirement from $10,000
to $25,000, and extended the law's sunset date for four years to
2002.
AB 1079 (Pacheco, Chapter 336, Statutes of 1999) doubled the
bonding requirement to $50,000, added new penalty provisions,
and reinstated specified consultant reporting requirements.
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AB 1858 (Romero, Chapter 674, Statutes of 2000) increased the
maximum civil penalty for a violation of the immigration
consultants law from $10,000 to $100,000, and required that
advertisements by or on behalf of a State Bar member, published
in the classified or "yellow pages" section of a telephone
directory regarding legal services related to immigration or
naturalization services, must include a statement that the
person is an active member of the State Bar. Further, if the
advertisement solicits for the employment of a law firm or
corporation that employs more than one attorney, the
advertisement must disclose that services related to immigration
or naturalization provided by the firm or corporation must be
provided by an active State Bar member, or by a person under the
member's active supervision.
SB 1194 (Romero, Chapter 304, Statutes of 2001) made it unlawful
for any person to hold out to be an immigration consultant
unless he or she has on file with the Secretary of State the
required bond. Repealed the January 1, 2002 sunset date of the
bond requirement for immigration consultants.
AB 1999 (Correa, Chapter 705, Statutes of 2002) authorized the
Attorney General, District Attorney, or city attorney to seek
civil penalties of up to $100,000 in prosecuting immigration
consultant cases, as well as injunctive relief, restitution or
other equitable relief on behalf of the general public. It also
authorized courts to order relief for benefit of the injured
parties to be paid from the bond that an immigration consultant
is required to post with the Secretary of State.
AB 534 (Vargas, Chapter 534, Statutes of 2003) increased the
client notification (written disclosure) and written contract
requirements for immigration consultants, and required the
immigration consultant to post in his or her office a list of
services and the related fees.
AB 2691 (Correa, Chapter 557, Statues of 2004) restricted the
use of a bond for compliance purposes to only the immigration
consultant or his or her employee, required the Secretary of
State to maintain a website for public access to information on
immigration consultants' bond status, and required immigration
consultants to provide specified identifying information.
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AB 630 (Chu, Chapter 605, Statutes of 2006) required
fingerprinting and background checks for immigration
consultants; authorized the Secretary of State to issue cease
and desist orders; required the Secretary of State to post
information on its Internet Web site about bond compliance,
filing disclosure statements, and passing of background checks,
and to post photographs of immigration consultants. The bill
further increased the statute of limitations for prosecuting
actions against an immigration consultant to four years.
5.Arguments in Support. San Diego Volunteer Lawyer Program, Inc .
(SDVLP) believes the bill is a reasonable approach to ensure
consumer protection for immigrants who are seeking relief under the
impending federal immigration reform bill, and argues that by
putting in place these safeguards now, the state can protect the
more than 2.5 million Californians who seek immigration reform act
services from the potential fraud and abuse that has already created
undue hardships for clients of immigration legal services. SDVLP
states that oftentimes lawyers and consultants make guarantees to
clients that they cannot fulfill, demand fees for services that they
cannot possibly provide at this time, and even prey upon members of
a community whose language barriers or unfamiliarity with the
American legal system leave them susceptible to this fraud.
6.Arguments in Opposition. The American Immigration Lawyers
Association (AILA) argues that the bill places unusual burdens on a
single group of attorneys which could have the effect of limiting
access to legal services for the state's immigrants. AILA believes
the bill should be made a two year bill in order to allow all
stakeholders to further discuss and develop precise protections.
AILA argues that there is no demonstrated need for the bill stating
that the State Bar's own reports show that immigration fraud
accounts for a miniscule percentage of draws on the Client Security
Fund, and that instead of being the problem, immigration lawyers are
the ones who expose fraud and pick up the pieces when things go
wrong.
AILA argues that there has not been an explanation why current statutes
and State Bar rules are insufficient to redress any inappropriate
behavior by a California attorney, and that some issues addressed by
the bill are already subject to redress under current law and State
Bar rules. AILA states, "It is unprecedented and unwarranted for a
state legislature to interfere in the attorney/client relationship
at this level, and the one-size-fits all micromanagement of that
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agreement neither benefits clients nor protects immigrants from
victimization."
AILA argues that the real threat is the victimization of vulnerable
immigrants by notarios and unscrupulous immigration form-preparers.
The bill places onerous business and procedural requirements on
immigration lawyers far in excess of what is imposed on other
attorneys in California. AILA contends that if the ultimate goal is
to prevent consumer fraud in immigration and to sanction bad actors,
the more effective solution is to focus resources on the enforcement
of existing civil and criminal provisions already designed to target
the worst offenders. However, the proposed legislation will only
deplete the number of well- intentioned, competent professionals
from one of the most humanitarian areas of the practice of law,
according to AILA.
AILA further argues that as seen from the recent loan modification
fiasco, that well-intentioned laws do not always have their intended
effect, stating that, "When the California Legislature sought to
protect an equally vulnerable class of persons facing potential
foreclosure by enacting provisions to prevent attorneys from
collecting fees early in the process, the new rules drove most
legitimate legal professionals away from this area of practice.
People had nowhere to go except to non-attorneys. Foreclosures
sharply rose, people lost their homes, and lien-holders lost their
money. This is essentially the same model being proposed to deal
with the prospect of comprehensive immigration reform, and will
likely have similar unintended results."
Finally, AILA argues, there is concern that there are not enough
qualified legal professionals to address the needs of the immigrant
community, and that the bill will deter lawyers from offering
immigration legal services. Increased capacity will be needed to
serve the estimated 3-4 million immigrants in California who will
need help under federal immigration reform legislation, and that
this bill would make it difficult if not impossible for lawyers who
would otherwise offer pro bono or low cost legal services to these
communities.
According to AILA,"At a time when the prospect of large-scale
immigration reform has highlighted the need for competent legal help
for immigrants, AB1159 would make practicing in this already complex
area so much more difficult and provide further disincentives to
entering the field."
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7.Recent Amendments. According to the Author, the recent amendments
have significantly narrowed the bill, and were primarily drafted to
address a number of the concerns raised by AILA.
NOTE : Double-referral to Judiciary Committee second.
SUPPORT AND OPPOSITION:
Support:
State Bar of California (Sponsor)
San Diego Volunteer Lawyer Program, Inc.
Western Center on Law and Poverty
Opposition:
American Immigration Lawyers Association
Consultant:G. V. Ayers