BILL ANALYSIS Ó
AB 1159
Page 1
Date of Hearing: September 12, 2013
ASSEMBLY COMMITTEE ON JUDICIARY
Bob Wieckowski, Chair
AB 1159 (Gonzalez) - As Amended: September 11, 2013
FOR CONCURRENCE
SUBJECT : IMMIGRATION ACT SERVICES
KEY ISSUE : SHOULD IMPORTANT ADDITIONAL CONSUMER PROTECTIONS BE
ENACTED TO PROTECT POTENTIALLY VULNERABLE IMMIGRANT CLIENTS FROM
FRAUD AND ABUSE REGARDING PROSPECTIVE IMMIGRATION REFORM ACT
SERVICES?
FISCAL EFFECT : As currently in print this bill is keyed fiscal.
synopsis
According to supporters, including the State Bar and others, 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 proposed federal
immigration reform. Reports indicate that immigration fraud has
already begun and a few bad actors are already making guarantees
they cannot fulfill, as well as already taking fees for services
they cannot possibly provide until the federal government has
acted. 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.
By putting these safeguards in place, it is hoped that the bill
will help prevent fraud and avoid more significant repercussions
down the road.
Specifically, this bill would require that when a contract for
legal services is subject to certain existing laws, 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
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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 also 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. Finally, the
bill would make it a violation of specified provisions of law
relating to the unauthorized practice of law for any person 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. As the result of the author's
strong efforts, the bill has no known opposition.
SUMMARY : Imposes various restrictions and obligations on
persons who would offer services with respect to potential
federal immigration reform legislation that may be enacted.
Specifically, this bill :
1)Provides 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)Provides 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
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written notice to the client, in English and the client's
native language.
3)Provides that when a contract for legal services is subject to
specified laws an attorney providing immigration reform act
services shall provide a written notice informing the client
where he or she may report complaints.
4)Requires the notice to be attached or incorporated into any
written contract for immigration reform act services, and be
signed by both the attorney and client. 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)Requires 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)Provides 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)Makes 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)Defines "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
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Internet Web site when an immigration reform act has been
enacted.
9)Defines 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)Provides 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)Provides that, in a civil action brought by the State Bar,
the civil penalty collected shall be paid to the State Bar and
allocated as specified, and that the State Bar shall annually
report any collection and expenditure of funds for the
preceding calendar year to the Assembly and Senate Committees
on Judiciary, as specified.
12)With respect to immigration consultants, the bill:
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
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: 1) after
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completing one or more of the itemized services, as
specified; or 2) 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: 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;
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."
13)States 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 this prohibition would be subject to a civil penalty
of up to $1,000 per day for each violation, as specified.
EXISTING LAW :
1)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. All
further statutory references are to this code unless otherwise
noted.)
2)Provides that in non-contingent fee matters, an attorney must
have a written contract for services with their client
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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. (Section 6148 (a), (c).)
3)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).)
4)Provides that no person shall practice law in California
unless the person is an active member of the State Bar.
(Section 6125.)
5)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. (Section 6126(a).)
6)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.
(Section 6030.)
7)Under 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.
(Section 22440 et seq.)
8)Further prohibits an immigration consultant from literally
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translating words or titles that imply that the person is an
attorney, as specified. (Section 22442.3.)
9)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. (Section 22445.)
10)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. (Section 22446.5.)
Existing law further allows a person who is awarded damages to
recover those damages from the required bond, as specified.
(Section 22447.)
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 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.
AB 1159
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This Bill Imposes Restrictions and Obligations With Respect to
Services In Connection With Pending Proposals For Federal
Immigration Reform. As the media has widely reported, Congress
has spent much of the year debating potential changes to federal
immigration law. While the outcome of that debate is far from
certain, various individuals have apparently sought to charge
immigrants for various legal and paralegal or quasi-legal
services that cannot appropriately be performed prior to
enactment of the proposed legislation. Given the potential size
of the immigrant pool that may be affected, a large number of
people is at risk of exploitation. Undocumented immigrants may
be particularly vulnerable to abuse by unscrupulous businesses
and individuals because of the risks they face in asserting
their rights as consumers and victims of fraud or other
wrongdoing.
Under the bill, "immigration reform act" is defined as an act of
Congress that is enacted after the effective date of this bill
before January 1, 2017. With respect to attorneys, the bill
specifies that immigration reform act services are those
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 who either entered the United States without
inspection or who did not depart after the expiration of a
nonimmigrant visa, to attain lawful status under an immigration
reform act.
Although a literal reading of this language - particularly with
respect to "other related initial processes" - might suggest an
unduly broad scope, it is important to note that the
acknowledged intent of the bill is to target attorneys who are
engaged for the purpose of serving clients regarding an
immigration reform law, rather than any lawyer whose services in
another type of matter might tangentially or incidentally touch
on a client's potential eligibility for legalization or
adjustment of immigration status. Such peripheral issues might
arise, for example, in the course of representation in a
criminal matter, employment dispute, domestic violence case or
retaliatory eviction challenge where the purpose of the
representation is not immigration status. Moreover, with
respect to engagement for the purpose of immigration law, this
definition clearly relates to services regarding an immigration
reform act and would not be implicated in the provision of
lawful and appropriate preliminary or preparatory work for
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clients, such as obtaining records and documentation, for use in
applications or filings under any other immigration or other
law, or for lawful and appropriate procedures or processes for
determining or obtaining legal relief under other immigration or
other laws.
Because the bill uses terms that are not used by current
immigration law, which may not be used in the proposed
immigration reform act (e.g., "undocumented immigrant"), the
bill requires the State Bar to issue a declaration stating
whether and when the referenced act has been enacted, which will
trigger the fee prohibitions and notice obligations discussed
below.
Restrictions on Lawyer Fees Before Any Immigration Reform Is
Enacted. This bill would prohibit an attorney from demanding
any funds, or from accepting advance payment of any funds, for
immigration reform act services prior to the enactment of an
immigration reform act. The reason for this prohibition appears
to be plain: before proposed legislation has been signed into
law, it is impossible to know who might be eligible and what
steps would be needed to submit an application. This prohibition
therefore seeks to target attorneys who are currently
advertising and collecting fees for highly questionable services
in connection with immigration reform that has not been enacted
and may never be enacted in the future. It should be noted that
the prohibition is directed at services for a fee; if no fee is
charged, this section is not triggered. However it would
apparently be a violation of the measure's intent to seek a fee
after enactment of an immigration reform act for uncompensated
services provided before enactment of the act.
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 after
enactment of this section but before enactment of an immigration
reform act where the services have not been rendered, this bill
would require the attorney to refund those fees, presumably
within 30 days of the effective date of this section,
consistently with the refund period prescribed for funds
received after the effective date of this section, or place them
in a client trust account. Client trust accounts are governed
by existing law. (Sections 6211, 6212.) If placed in a trust
account, the attorney must provide a specified notice in English
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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.
Prospective Obligation To Notify Clients Of Complaint Rights If
And When Immigration Reform Is Enacted. In addition to the fee
prohibition noted above (which applies prior to the enactment of
an immigration reform act) this bill also regulates the conduct
of attorneys after the enactment of an immigration reform act.
Specifically, the bill requires an attorney who provides
immigration reform act services to provide a specified notice
when a contract for legal services is required in writing
pursuant to Section 6148, or is subject to Section 1632 of the
Civil Code. Section 6148 requires a written contract for any
legal services over $1000 and specifies the content of that
contract. Civil Code section 1632 requires written translations
of certain contracts for legal services negotiated in specified
languages other than English. This section becomes operative
when the State Bar posts on its Internet Web site the form and
translations described below.
The written notice must inform the client that he or she may
report complaints to the Executive Office for Immigration Review
of the United States Department of Justice, to the State Bar of
California, or to the bar of the court of any state, possession,
territory, or commonwealth of the United States or of the
District of Columbia where the attorney is admitted to practice
law. The notice shall include the toll-free telephone numbers
and Internet Web sites of those entities. Although section 6148
and Civil Code section 1632 apply only to members of the State
Bar, the bill makes clear that admission to the State Bar is not
a necessary condition for application of this provision.
The State Bar is required to provide the form of the notice,
translate the form into specified languages, and post the form
and translations on its Internet Web site. The notice is
required to be in English and in one of the languages of the
forms translated by the State Bar if the contract for
immigration reform act services was negotiated in one of those
languages. This provision is thus unlike the notice provision
described above for clients whose funds are deposited in a
client trust account in that the translation obligation for this
notice applies only to contracts negotiated in a language other
than English while the client trust account notice is required
to be translated regardless of the language of negotiation.
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A violation of this provision makes the contract voidable at the
option of the client. This is the only express penalty for
violation of the notice requirement. While it might be assumed
that the State Bar may seek to initiate discipline proceedings
for a violation, the bill does not expressly provide that
violation of this section is cause for discipline. (Compare
sections 6106.2 and 6106.3. See also Article 5 of the State Bar
Act (starting at section 6075) and Article 6 (starting at
section 6100) setting forth a disciplinary scheme for specified
violations.) Any ground for discipline therefore would appear
to rest on some unstated or implicit authority. (Cf. In the
Matter of David M. Harney, 3 Cal State Bar Ct. Rptr. 266
(1995)(analyzing potential discipline for violation of section
6148.)
Attorneys Subject To These Provisions. This bill would apply
the above provisions regarding 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 who (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 attorneys in California are treated similarly.
Reform Of Immigration Consultants Act. 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.
Existing law imposes various requirements on those who act in
the capacity of an immigration consultant. Consultants must
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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. Violation 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
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.
Expansion of Existing Prohibition Against Using Terms That Cause
Confusion Regarding Practice of Law. Current law prohibits
immigration consultants from using certain terms that when
translated from English imply that the person is an attorney.
This bill would expand that prohibition to all persons, and
would specify that it is a violation of the prohibition against
the unlicensed practice of law under section 6126. In addition
to the existing civil penalty for a violation of section 6126,
the bill provides a further civil penalty of up to 1,000 per day
for each violation, to be assessed and collected in a civil
action brought by the State Bar. Consistently with AB 888
(Dickinson) which provides that civil penalties for violation of
section 6126 are to be directed to the Justice Gap Fund, which
provides small but important supplemental funding for qualified
legal services projects and support centers according to the
established interest on lawyer's trust accounts formula, or if
needed for the purposes of mitigating potential unpaid claims of
injured immigrant clients, as directed by the Board of Trustees
of the State Bar.
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REGISTERED SUPPORT / OPPOSITION :
Support
State Bar of California (sponsor)
AFSCME, AFL-CIO
California Catholic Conference
California Labor Federation
Los Angeles County Sheriff, Leroy D. Baca
San Diego Volunteer Lawyer Program, Inc.
UNITE HERE Local 30
Western Center on Law and Poverty
Opposition
None on file
Analysis Prepared by : Kevin G. Baker / JUD. / (916) 319-2334