BILL ANALYSIS                                                                                                                                                                                                    



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          CONCURRENCE IN SENATE AMENDMENTS
          AB 1159 (Gonzalez)
          As Amended September 11, 2013
          2/3 vote.  Urgency
           
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          |ASSEMBLY:  |     |(May 9, 2013)   |SENATE: |38-0 |(September 12, |
          |           |     |                |        |     |2013)          |
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                    (vote not relevant)

          Original Committee Reference:   ED.  

           SUMMARY  :  Imposes various restrictions and obligations on  
          persons who would offer services related to comprehensive  
          immigration reform.  

           The Senate amendments  delete the Assembly version of this bill,  
          and instead:

          1)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.

          2)Provide that:

             a)   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

             b)   Any funds received before the effective date of this  
               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.








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          3)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. 

          4)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.

          5)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.

          6)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.

          7)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.

          8)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.








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          9)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.

          10)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.

          11)Provide that, in a civil action brought by the State Bar, the  
            civil penalty collected shall be paid to the 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.  

          12)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.

          13)With respect to immigration consultants:

             a)   Increases the amount of the bond to $100,000, effective  
               July 1, 2014;

             b)   Requires each service to be performed to be itemized  
               with an explanation of the purpose and process of the  
               service, and make corresponding changes;

             c)   Revises the existing exemptions for non-profit tax  
               exempt corporations who help client complete application  
               forms by clarifying that only a nominal fee may be charged;
             d)   Requires an immigration consultant who provides  
               immigration reform act services to establish and deposit  
               into a client trust account any funds received from a  








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               client prior to performing those services;

             e)   Allows an immigration consultant providing immigration  
               reform act services for the client to withdraw funds  
               received from that client:  i) after completing one or more  
               of the itemized services, as specified; or ii) after  
               completing one or more of the documents listed, as  
               specified;

             f)   Prohibits 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; 

             g)   Provides that funds received after the effective date of  
               this bill but before enactment of an immigration reform act  
               must be refunded to the client;

             h)   Provides that for funds received before the effective  
               date of the bill: i) the consultant must provide the client  
               with an accounting for services that were rendered; and ii)  
               any funds received for which services have not yet been  
               rendered must be refunded or deposited into a client trust  
               account, as specified; 

             i)   States 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

             j)   Expressly prohibits the literal translation of the  
               phrase "notary public" into Spanish as "notario public" or  
               "notario."

          14)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 Immigration  
            Consultants Act (ICA), this bill provides 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.









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           FISCAL EFFECT  :  According to the Senate Appropriations  
          Committee:

          1)Minor costs in fiscal year (FY) 2013-14 of less than $20,000  
            (Special Fund*) to the Secretary of State (SOS) for form and  
            Web site changes, noticing, and postage.  Additional costs in  
            FY 2014-15 of approximately $35,000 (Special Fund*) to  
            accommodate the increased workload associated with bond  
            processing and cease and desist notices and orders in response  
            to the surety bond increase for immigration consultants. 

          2)Minor, absorbable one-time costs to the Department of Consumer  
            Affairs (DCA) to revise regulations related to written  
            contract requirements for immigration consultants.

          3)One-time costs to the State Bar to create a template contract  
            form and necessary language translations.  All costs to be  
            offset by existing fee revenue.

          4)Non-reimbursable local costs for enforcement offset to a  
            degree by fine revenue for violations of various prohibitions  
            specified in the bill. 

          5)Potential minor revenue increases (General Fund) for civil  
            penalty collections to the extent additional civil actions are  
            brought by the Attorney General.

          *Business Fees Fund

           COMMENTS  :  In support of the bill, the author states:

               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  








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               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.

           
          Analysis Prepared by  :    Kevin G. Baker / JUD. / (916) 319-2334 


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