BILL ANALYSIS Ó
SENATE JUDICIARY COMMITTEE
Senator Noreen Evans, Chair
2013-2014 Regular Session
AB 1159 (Gonzalez)
As Amended September 6, 2013
Hearing Date: September 10, 2013
Fiscal: Yes
Urgency: Yes
BCP
PURSUANT TO SENATE RULE 29.10
SUBJECT
Immigration Services
DESCRIPTION
This bill would require that, when a contract for legal services
is required to be in writing, as specified, an attorney
providing immigration reform act services must provide a written
notice informing the client that he or she may report complaints
to specified entities.
The bill would also prohibit an attorney or an immigration
consultant from demanding or accepting the advance payment of
any funds for immigration reform act services before the
enactment of an immigration reform act, as defined, and would
require any funds received after the effective date of this
bill, but before the enactment of an immigration reform act, to
be refunded to the client. The bill would require any funds
that were received before the effective date of the bill for
services not yet rendered to be either refunded to the client or
deposited in a client trust account, as specified.
This bill would increase the amount of bond required to be filed
by an immigration consultant from $50,000 to $100,000, and
require consultants to itemize their contracts, establish a
client trust account, and to deposit any funds received from the
client prior to performing immigration reform act services.
The bill would make it a violation of specified provisions of
law relating to the unauthorized practice of law for any person
(more)
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who is not an attorney to literally translate from English into
another language the phrases "notary public," "notary,"
"licensed," "attorney," "lawyer," or any other terms that imply
that the person is an attorney.
BACKGROUND
The Immigration Consultants Act (ICA) was enacted in 1986 to
regulate activities of immigration consultants who perform a
variety of services for persons who seek adjustment of their
immigrant status at minimal cost. The explosion of immigration
applications, a result of the 1986 federal and amnesty law
revisions, necessitated the regulation of these persons. The
ICA and its subsequent amendments now require immigration
consultants to, among other things: (1) provide clients with
written contracts; (2) file a bond with the Secretary of State;
and (3) post a notice of compliance with the bonding requirement
and a statement that the immigration consultant is not an
attorney (if pertinent) or that the attorney is authorized under
some other federal rule or is an attorney from another state.
Due to concerns that pending federal immigration reform could
result in a similar increase in immigration applications, this
bill seeks to enact various restrictions on persons who would
offer services pursuant to that reform. Regarding the impact of
the pending proposal for reform, the Border Security, Economic
Opportunity, and Immigration Modernization Act of 2013 (S. 744),
the United States' Senate Judiciary Committee Report noted:
One of the key components of the Border Security, Economic
Opportunity and Immigration Modernization Act (S. 744) is
the path to earned citizenship for the estimated 11 million
undocumented immigrants living and working in the shadows of
American society. This legislation will give this
population a tough but fair opportunity to come forward and
earn their citizenship by meeting several requirements,
including paying fees and fines, passing national security
and criminal background checks, paying their taxes, and
learning English.
During the Committee's consideration of S. 744, and its
extensive study and consideration of comprehensive
immigration reform in previous Congresses, the Committee has
heard from law enforcement officials, community leaders,
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faith groups, civil rights groups, and individual members of
the public about the urgent need to address the millions of
undocumented immigrants living in the United States.
Undocumented immigrants have a tenuous place in our
communities. They live in constant fear of deportation. If
they are victims of crime, they often do not report those
crimes to State and local law enforcement. They work for low
wages, unable to defend themselves from employer harassment
and exploitation. Many have been in the country for 10
years or more, have made valuable contributions to their
communities, and have immediate relatives who are American
citizens. The prospect of deporting these individuals would
not only be prohibitively expensive, but would also have
untold damaging effects on our economy, which relies on the
work, taxes, and purchasing power of undocumented immigrants
even as our legal system fails to fully recognize or protect
them. It would separate families and run counter to our
ideals as a Nation. Instead, S. 744 outlines a tough but
fair path that will bring individuals out of the shadows and
into the lawful immigration system, by allowing eligible
applicants to adjust to the legal status of Registered
Provisional Immigrant (RPI).
(http://www.gpo.gov/fdsys/pkg/CRPT-113srpt40/pdf/CRPT-113srpt
40.pdf.)
S. 744 was passed by the Senate on June 27, 2013, and is
currently in the House of Representatives. To proactively
address the fraud that likely will occur as a result of the
passage of S. 744, this bill would impose various restrictions
on immigration consultants and attorneys who offer services
pursuant to any pending or future immigration reform act,
including a prohibition on accepting advance fees before the
immigration reform is enacted.
This bill was originally approved by this Committee on August
26, 2013, and, as a result of concerns expressed by committee
members, the author agreed to strike out provisions of the
bill that would have required attorneys to provide a
translated written contract. The author subsequently removed
those provisions from this bill, and, on September 6, 2013,
amended the bill to, among other things, require an attorney
providing immigration reform act services to provide a written
notice informing the client as to where he or she may report
complaints. AB 1159 is now before this Committee pursuant to
Senate Rule 29.10 for approval of those amendments.
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CHANGES TO EXISTING LAW
1. Existing law requires all attorneys who practice law in
California to be members of the State Bar of California (State
Bar) and establishes the State Bar for the purpose of
regulating the legal profession. (Bus. & Prof. Code Sec. 6000
et seq.)
Existing law provides that in non-contingent fee matters, an
attorney must have a written contract for services with their
client whenever the client's total expense, including fees,
will foreseeably exceed $1,000, as specified. The written
contract must contain: (1) any basis compensation; (2) the
general nature of the legal services to be provided; and (3)
the respective responsibilities of the attorney and the client
as to the performance of the contract. Failure to comply with
the written contract requirement renders the agreement
voidable at the option of the client, and the attorney shall,
upon the agreement being voided, be entitled to collect a
reasonable fee. (Bus. & Prof. Code Sec. 6148 (a), (c).)
Existing law requires a person who negotiates primarily in
Spanish, Chinese, Tagalog, Vietnamese, or Korean to deliver to
the other party to the contract a translation of the contract
or agreement in the language in which the contract or
agreement was negotiated, as specified. That requirement
applies to various contracts and agreements, including, those
for the purpose of obtaining legal services. (Civ. Code Sec.
1632 (b).)
This bill would provide that it is unlawful for an attorney to
demand or accept advance payment of any funds from a person
for immigration reform act services before the enactment of an
immigration reform act. Any funds received after the
effective date of this bill, but, before the enactment of an
immigration reform act must be promptly refunded to the
client, as specified.
This bill would further provide that:
if an attorney providing immigration reform act services
accepted funds prior to the effective date of this bill,
and the services provided in connection with payment of
those funds were rendered, the attorney shall promptly
provide the client with a statement of accounting
describing services rendered; and
any funds received before the effective date of this
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bill for which immigration reform act services were not
rendered prior to the effective date, shall be either
refunded to the client or shall be deposited in a client
trust account. If the attorney elects to deposit funds in
a client trust account, he or she shall provide a specified
written notice to the client, in English and the client's
native language.
This bill would provide that when a contract for legal
services is required to be in writing, as specified, an
attorney providing immigration reform act services shall
provide a written notice informing the client where he or she
may report complaints.
This bill would require that notice to be attached or
incorporated into any written contract for immigration reform
act services, and, require the notice to be signed by both the
attorney and client if it is attached to a written contract.
This bill would require the notice to be in English and in one
of the languages translated by the State Bar, if the contract
for immigration reform act services was negotiated in one of
those languages.
This bill would require the State Bar to provide the form of
the notice, post the form and translations of the form on its
Internet Web site, and to translate the form into Spanish,
Chinese, Tagalog, Vietnamese, Korean, Armenian, Persian,
Japanese, Russian, Hindi, Arabic, French, Punjabi, Portuguese,
Mon-Khmer, Hmong, Thai, and Gujarati. This bill would specify
that an attorney who meets specified criteria shall be
responsible for adding and translating the name of, toll-free
number of, and information on the Internet Web site for, the
bar or court in which he or she is admitted to practice law.
This bill would provide that failure to comply with the notice
and translation requirement renders the contract voidable at
the option of the client, and the attorney shall, upon the
contract being voided, be entitled to collect a reasonable
fee.
This bill would make the above notice and translation
provision operative when the State Bar posts on its Internet
Web site the required form and translations, and, require the
State Bar to post the form and translations as soon as
practicable but no later than 45 days after the effective date
of the bill.
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This bill would define "immigration reform act" as any pending
or future act of Congress that is enacted after the effective
date of this section but before January 1, 2017, including but
not limited to the "Border Security, Economic Opportunity, and
Immigration Modernization Act" (S. 744, 2013), as specified.
This bill would require the State Bar to announce and post on
its Internet Web site when an immigration reform act has been
enacted.
This bill would define immigration reform act services as
services offered in connection with an immigration reform act
that are necessary in the preparation of an application and
other related initial processes in order for an undocumented
immigrant, as specified, to attain lawful status under the
immigration reform act.
2. Existing law provides that no person shall practice law in
California unless the person is an active member of the State
Bar. (Bus. & Prof. Code Sec. 6125.)
Existing law provides that any person advertising or holding
himself or herself out as practicing or entitled to practice
law or otherwise practicing law who is not an active member of
the State Bar, or otherwise authorized pursuant to statute or
court rule to practice law in this state at the time of doing
so, is guilty of a misdemeanor. (Bus. & Prof. Code Sec.
6126(a).)
Existing law authorizes the State Bar to enjoin any violations
or threatened violations of the unauthorized practice of law
in a civil action brought in the superior court by the State
Bar. (Bus. & Prof. Code Sec. 6030.)
This bill would provide that it is a violation of the existing
prohibition on non-attorneys advertising or holding themselves
out as entitled to practice law for any person who is not an
attorney to literally translate from English into another
language, in any document, any words or titles, including
"notary public," "notary," "licensed," "attorney," or "lawyer"
that imply the person is an attorney, as specified. This bill
would provide that a person who violates the translation
prohibition is liable for a civil penalty not to exceed
$1,000, as specified.
This bill would provide that, in a civil action brought by the
State Bar, the civil penalty collected shall be paid to the
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State Bar and allocated to provide free legal services related
to immigration reform act services to clients of limited means
or to a fund for the purposes of mitigating unpaid claims of
injured immigrant clients.
This bill would require the Board of Trustees of the State Bar
to annually report any collection and expenditure of funds for
the preceding calendar year to the Assembly and Senate
Committees on Judiciary, as specified.
3. Existing law , the Immigration Consultants Act (ICA),
regulates the activities of immigration consultants by
requiring them to pass a background check conducted by the
Secretary of State (SOS), file a $50,000 bond with the SOS, to
comply with specified notice requirements, and to provide
clients with written contracts in their native language, as
specified. (Bus. & Prof. Code Sec. 22440 et seq.)
Existing law further prohibits an immigration consultant from
literally translating words or titles that imply that the
person is an attorney, as specified. (Bus. & Prof. Code Sec.
22442.3.)
Existing law provides that a violation of the ICA subjects a
person to a civil penalty not to exceed $100,000 for each
violation, is a misdemeanor punishable by a fine of not less
than $2,000 or more than $10,000, and that the second or
subsequent violation is a felony. (Bus. & Prof. Code Sec.
22445.)
Existing law allows a person claiming to be aggrieved to bring
a civil action for injunctive relief, or damages, or both, and
requires a court finding a violation to award the plaintiff
actual damages plus treble damages, as specified, and
reasonable attorney's fees and costs. (Bus. & Prof. Code Sec.
22446.5.) Existing law further allows a person who is awarded
damages to recover those damages from the required bond, as
specified. (Bus. & Prof. Code Sec. 22447.)
This bill would additionally:
increase the amount of the bond to $100,000,
effective July 1, 2014;
require each service to be performed to be itemized
with an explanation of the purpose and process of the
service, and make corresponding changes;
revise the existing exemptions for non-profit tax
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exempt corporations who help client complete application
forms by clarifying that only a nominal fee may be
charged;
require an immigration consultant who provides
immigration reform act services to establish and deposit
into a client trust account any funds received from a
client prior to performing those services;
allow an immigration consultant providing
immigration reform act services for the client to
withdraw funds received from that client: (1) after
completing one or more of the itemized services, as
specified; or (2) after completing one or more of the
documents listed, as specified;
prohibit an immigration consultant from demanding or
accepting advance payment of any funds from a person for
immigration reform act services before the enactment of
an immigration reform act;
provide that funds received after the effective date
of this bill but before enactment of an immigration
reform act must be refunded to the client;
provide that for funds received before the effective
date of the bill: (1) the consultant must provide the
client with an accounting for services that were
rendered; and (2) any funds received for which services
have not yet been rendered must be refunded or deposited
into a client trust account, as specified;
state that a person who violates the above
restrictions on advance fees shall be subject to a civil
penalty not to exceed $1,000, as specified, and require a
court to grant a prevailing plaintiff reasonable
attorney's fees and costs. ; and
expressly prohibit the literal translation of the
phrase "notary public" into Spanish as "notario public"
or "notario."
This bill would state that a violation of the existing
prohibition on translating terms that imply the person is an
attorney is a violation of the State Bar Act's prohibition on
non-attorney's holding themselves out to be authorized to
practice law. In addition to the remedies and penalties under
the ICA law, this bill would provide that a person who
violates the translation prohibition would be subject to a
civil penalty of up to $1,000 per day for each violation, as
specified.
COMMENT
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1. Stated need for the bill
According to the author:
AB 1159 is an important consumer protection measure that
will immediately assist in helping to protect the vulnerable
community that will be seeking assistance under
comprehensive immigration reform.
Immigration fraud has already begun. A few bad actors are
already making guarantees they cannot fulfill, and are
already taking fees for services they cannot possibly
provide until the federal government has acted.
If immigration reform passes, it is estimated that 11
million nationwide will be impacted. Of that 11 million,
approximately 2.55 million live in California. No one knows
how many of the 2.55 million will be victimized by fraud,
but we do know the risk of fraud is very high since the
fraud is already occurring. . . AB 1159 is designed to
significantly help reduce fraud and 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. By putting in place these
safeguards now, the bill will help prevent the fraud at the
front end, avoiding more significant repercussions down the
road.
2. September 6, 2013 Amendments
In response to concerns raised about the prior version of the
bill, the September 6, 2013 amendments inserted language that
requires an attorney providing immigration reform act services
to provide a written notice to the client as to where he or she
may report complaints. The State Bar would be required to
provide the form of the notice and post the form and
translations on its Internet Web site. The September 6, 2013
amendments further require the notice to be in English and one
of the specified languages, as necessary, provided by the State
Bar (if the contract was negotiated in one of those languages).
As a result, attorneys who are active members of the State Bar
would be able to comply with the requirements of the bill by
using one of the forms posted by the State Bar. For attorneys
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who are not active members of the State Bar, but authorized
under federal law to practice law, this bill would require the
attorney to be responsible for adding and translating
information for the bar of the court in which he or she is
admitted to practice law.
It should be noted that the above notice and translation
requirements would only apply when a contract for legal services
is required to be in writing (See Business & Profession Code
Sec. 6148), or, is required to be translated into the language
it was negotiated (Civil Code Section 1632). Thus, the required
notice would be attached (or incorporated) into a contract that
is already required to be in writing pursuant to existing law.
Staff notes that, in addition to the notice and translation
provision discussed above, the September 6, 2013 amendments also
would: (1) required the State Bar to direct civil penalties
recovered in civil actions relating to "notarios" to free legal
services relating to the immigration reform act or for purposes
of mitigating the unpaid claims of injured immigrant clients;
(2) required the State Bar to announce and post on its Internet
Web site when an immigration reform act has been enacted; (3)
clarified timelines and requirements related to the prohibition
on advance fees for immigration reform act services; and (4)
made other clarifying changes.
3. Attorney provisions previously approved by this Committee
In addition to the provision described in Comment 2, this bill
would restrict the ability of attorneys to receive advance fees
for immigration reform act services before the reform is
enacted, and define the attorneys covered by the bill's
provisions.
a. Advance fee prohibition
This bill would prohibit an attorney from demanding or
receiving advance payment of any funds from a person for
immigration reform act services before the enactment of an
immigration reform act. That prohibition seeks to target
attorneys who are reportedly advertising and collecting fees
for services in connection with immigration reform that may or
may not be enacted in the future. Although, as noted in the
Background above, the Border Security, Economic Opportunity,
and Immigration Modernization Act of 2013 (S. 744) is
currently in the House of Representatives, it is unclear
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whether it will actually be passed, or, if passed, if it will
resemble the current form of the Act. As a result, this bill
seeks to prohibit the collection of fees that attorneys may be
currently collecting for reform that may never be enacted.
The American Immigration Lawyers Association (AILA), in
opposition, asserts: "AILA understands the need to restrict
the ability of attorneys to collect fees for a service that is
not permitted or warranted under existing law. There are many
ethics rules attorneys must follow on this subject. However,
[Section] 6242 of AB 1159 would also prohibit an attorney from
completing critical research and background work. AILA
believes that these services are legitimate and permitted
under current law. AB 1159 should not impede an attorney's
ability to service a client." It should be noted that, in
response to AILA's concerns, the author previously accepted an
amendment in this Committee to clarify that immigration reform
act services are those offered in connection with pending or
future immigration reform. Staff notes that the recent
amendments have not fully addressed the concerns raised by
AILA.
This bill would further provide that if fees were collected
before this bill is enacted, and the services were rendered,
the attorney must provide the client with a statement of
accounting for those services. For fees that were collected
before enactment and the services have not been rendered, this
bill would require the attorney to refund those fees or place
them in a client trust account. If placed in a trust account,
the attorney must provide a specified notice in English and
the client's native language. Any advance fees received after
the effective date of the bill, but before the enactment of an
immigration reform act, must be returned to the client.
b. Application of attorney provisions
This bill would apply the above provisions regarding advance
fees and written notices to attorneys who are active members
of the State Bar, as well as to attorneys who are not active
members but (1) provide immigration reform act services in an
office or business in California and (2) are authorized by
federal law to practice law and to represent persons before
the Board of Immigration Appeals of the United States
Citizenship and Immigration Services. From a policy
standpoint, that provision would appear to apply the above
restrictions with some uniformity so that clients who visit
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attorneys in California are treated similarly.
AILA, in opposition, contends that "[u]nder Immigration
practice, many out-of-state attorneys work with [U.S.
Citizenship and Immigration Services (USCIS)] offices like the
California Service Center (CSC) to represent individuals in
California. The state should not be involved in seeking to
restrict the ability of an attorney, authorized by federal
law, to practice law in California. Such regulations are
likely preempted by federal law. AILA would ask that the
provisions relating to federal immigration attorneys be
removed." The State Bar, in response, contends that:
"California under its police powers has jurisdiction over
non-California lawyers who are doing business in the State and
representing immigrant clients residing in the State. Those
lawyers have to comply with all other existing laws when doing
business in the state. The ban on no advance payments and
written contracts in AB 1159 regulates the transaction with
clients, not what the lawyer may or may not do before BIA or
USCIS."
4. Restrictions on immigration consultants approved by this
Committee
As noted in the Background, existing law imposes numerous
requirements on those who would act in the capacity of an
immigration consultant. Consultants must pass a background
check, provide clients with a written contract in English and
the client's native language, conspicuously display a statutory
notice with specified information (including that the consultant
is not an attorney), and file a $50,000 surety bond with the
Secretary of State. Existing law also prohibits consultants
from making false or misleading statements, making guarantees or
promises unless it is in writing and there a basis in fact for
the promise or guarantee, and making any statement that the
consultant can obtain special favors. Violations of those
provisions is a misdemeanor, subject a person to a civil penalty
not to exceed $100,000, and can be a felony if there are repeat
violations.
This bill would further strengthen those provisions by: (1)
requiring the written contract to itemize each service to be
performed; (2) requiring consultants who provide immigration
reform act services to deposit any funds received into a client
trust account and only withdraw funds upon completing an
itemized service or a document listed; (3) prohibiting
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consultants from demanding or accepting advance payment of any
funds from a person for immigration reform act services before
the reform is enacted; (4) imposing a civil penalty of up to
$1,000 per day for violations of the advance fee prohibition;
and (5) increasing the amount of the required surety bond from
$50,000 to $100,000.
5. Translation provision approved by this Committee
Under existing law, immigration consultants are prohibited from
literally translating, with the intent to mislead, any words or
titles, including notary public, notary, licensed, attorney, or
lawyer, that imply that the person is an attorney. (Bus. &
Prof. Code Sec. 22442.3.) That prohibition was added by AB 2520
(Napolitano, Chapter 561, Statutes of 1994) in response to
instances of consumer fraud by non-attorney immigration service
providers. This Committee's analysis noted that the prohibition
was supported by the findings of a State Bar Task Force as
follows:
Testimony at the two public hearings revealed that the
highest incidence of consumer fraud appears to be engaged in
by non-attorney immigration service providers, although
complaints were also heard regarding activities engaged in
by both out-of-state and California-licensed attorney
immigration service providers. Many non-attorney service
providers employ storefront advertisements which hold
themselves out as a "notario," "licenciado," or "abogado;"
terms which can connote legal training or licensure to
members of the Latin-American immigrant community.
Advertisements are often misleading and deceptive, raising
false consumer hopes in an attempt to attract business.
Non-attorney service providers appear to frequently change
business locations to: 1) avoid unhappy clients; 2) avoid
law enforcement investigation and prosecution; and 3)
attract fresh customers.
This bill would strengthen that existing translation prohibition
(and a related prohibition regarding the surety bond) by
providing that a violation is also a violation of the State Bar
Act's prohibition on non-attorney's advertising or holding
themselves out as practicing or entitled to practice law,
expressly prohibit translation of the phrase "notary public"
into Spanish as "notario public" or "notario," and, add a civil
penalty of up to $1,000 per day for each violation. This bill
would also add similar language to the State Bar Act that would
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prohibit any person who is not an attorney from literally
translating any words that imply the person is an attorney, and,
specifically prohibit the translation of the phrase "notary
public" into Spanish as "notario public" or "notario."
Consistent with the proposed change to the ICA, this bill would
add a $1,000 civil penalty to the prohibition on translation
that would be added to the State Bar Act.
Support (prior version of the bill) : American Federation of
State, County, and Municipal Employees (AFSCME), AFL-CIO;
California Catholic Conference; California Labor Federation; San
Diego Volunteer Lawyer Program, Inc.; Sheriff Leroy D. Baca;
UFW; UNITE HERE Local 30; Western Center on Law & Poverty
Opposition (prior version of the bill) : AIDS Legal Referral
Panel; American Immigration Lawyers Association; Asian American
Bar Association of the Greater Bay Area; Asian Law Alliance;
Asian Pacific Islander Legal Outreach; Central American Resource
Center; Justice for Our Neighbors - Bay Area Immigration
Taskforce; National Center for Lesbian Rights; National Lawyers
Guild Bay Area Chapter; Northern California Chapter of the
American Immigration Lawyers Association; Northern California
Chapter of the Iranian American Bar Association; Omid Advocates;
Pangea Legal Services; San Diego Chapter of the American
Immigration Lawyers Association; San Diego Chapter of the
Iranian American Bar Association; Southern California Chapter of
the American Immigration Lawyers Association; one individual
HISTORY
Source : State Bar of California
Related Pending Legislation : AB 888 (Dickinson) would allow the
State Bar to bring a civil action for any violation of the
existing prohibitions on the unauthorized practice of law, and
require the court in those actions to impose a civil penalty,
consider providing relief to any injured party, and award the
State Bar reasonable attorney's fees and costs. This bill is
currently on the Senate Floor.
Prior Legislation :
AB 630 (Chu, Chapter 605, Statutes of 2006) increased the
regulation of immigration consultants by: (1) requiring
fingerprinting and background checks; (2) authorizing the
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Secretary of State to issue cease and desist orders; and (3)
requiring the Secretary of State to post information on its
Internet Web site about bond compliance, filing of disclosure
statements, the passing of background checks, and photographs of
immigration consultants.
Prior Vote :
Senate Committee on Appropriations (Ayes 7, Noes 0)
Senate Committee on Judiciary (Ayes 7, Noes 0)
Senate Committee on Business, Professions and Economic
Development (Ayes 9, Noes 0)
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