California Legislature—2013–14 Regular Session

Assembly Bill No. 1608

Introduced by Assembly Member Olsen

February 5, 2014

An act to amend, repeal, and add Sections 7512.3, 7525.1, 7529, 7538, 7538.5, and 7539 of, and to add and repeal Section 7520.3 of, the Business and Professions Code, relating to private investigators.

LEGISLATIVE COUNSEL’S DIGEST

AB 1608, as introduced, Olsen. Private investigators: limited liability companies.

Existing law, the Private Investigator Act, provides for the licensure and regulation of private investigators by the Bureau of Security and Investigative Services within the Department of Consumer Affairs and makes a violation of the licensing requirements a crime. Existing law defines a person, for purposes of the act, to include any individual, firm, company, association, organization, partnership, and corporation.

Existing law, the California Revised Uniform Limited Liability Company Act, governs the formation and operation of limited liability companies. The act authorizes a limited liability company to engage in any lawful business activity, except as specified, but prohibits construing the act to permit a limited liability company to render professional services, as defined. Existing law authorizes a limited liability company to render services that may be lawfully rendered only pursuant to a license, certificate, or registration authorized by the Business and Professions Code if the provisions of that code authorize a limited liability company to hold that license, certificate, or registration.

This bill, until January 1, 2020, would authorize the bureau to issue a private investigator license to a limited liability company and would make related conforming changes. The bill would require a limited liability company applicant for a private investigator license to provide specified information to the bureau, including the true name and complete residence address of each of the managing members and any other officers or members who will be active in the business. The bill would require a limited liability company, as a condition of licensure, to maintain liability insurance, as specified, for damages arising out of claims based on acts, errors, or omissions arising out of the private investigator services it provides. The bill would require a Certificate of Liability Insurance, as specified, to be submitted to the bureau, and would require the insurer issuing the certificate to report specified information to the bureau related to the policy. The bill would authorize suspension of the license of a licensee that fails to maintain sufficient insurance pursuant to these provisions and would render each member of the limited liability company personally liable, up to $1,000,000 dollars each, for damages resulting to 3rd parties in connection with the company’s performance during the period of suspension, as specified. By expanding the scope of an existing crime, this bill would create a state-mandated local program.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes.

The people of the State of California do enact as follows:

SECTION 1.  

Section 7512.3 of the Business and Professions
Code is amended to read:

7512.3.  

begin insert (a) end insert begin insert   end insert As used in this chapter, “person” includes any
individual, firm, company, begin insert limited liability company, end insert association,
organization, partnership, and corporation.

begin insert

(b) This section shall remain in effect only until January 1, 2020,
and as of that date is repealed, unless a later enacted statute, that
is enacted before January 1, 2020, deletes or extends that date.

end insert

SEC. 2.  

Section 7512.3 is added to the Business and Professions
Code, to read:

7512.3.  

(a) As used in this chapter, “person” includes any
individual, firm, company, association, organization, partnership,
and corporation.

(b) This section shall become operative on January 1, 2020.

SEC. 3.  

Section 7520.3 is added to the Business and Professions
Code, to read:

7520.3.  

(a) As a condition of the issuance, reinstatement,
reactivation, or continued valid use of a license under this chapter,
a limited liability company shall, in accordance with this section,
maintain a policy or policies of insurance against liability imposed
on or against it by law for damages arising out of claims based
upon acts, errors, or omissions arising out of the private investigator
services it provides.

(b) The total aggregate limit of liability under the policy or
policies of insurance required under this section shall be as follows:

(1) For a limited liability company licensee with five or fewer
persons named as managing members pursuant to subdivision (i)
of Section 7525.1, the aggregate limit shall not be less than one
million dollars ($1,000,000).

(2) For a limited liability company licensee with more than five
persons named as managing members pursuant to subdivision (i)
of Section 7525.1, an additional one hundred thousand dollars
($100,000) of insurance shall be obtained for each person named
as managing members of the licensee except that the maximum
amount of insurance is not required to exceed five million dollars
($5,000,000) in any one designated period, less amounts paid in
defending, settling, or discharging claims as set forth under this
section.

(c) Prior to the issuance, reinstatement, or reactivation of a
limited liability company license as provided under this chapter,
the applicant or licensee shall, in the manner prescribed by the
bureau, submit the information and documentation required by
this section and requested by the bureau, demonstrating compliance
with the financial security requirements specified by this section.

(d) For any insurance policy secured by a licensee in satisfaction
of this section, a Certificate of Liability Insurance, signed by an
authorized agent or employee of the insurer, shall be submitted
electronically or otherwise to the bureau. The insurer issuing the
certificate shall report to the bureau the following information for
any policy required under this section: name, license number,
policy number, dates that coverage is scheduled to commence and
lapse, the date and amount of any payment of claims, and
cancellation date if applicable.

(e) If a licensee fails to maintain sufficient insurance as required
by this section, the license is subject to suspension.

(f) If the license of a limited liability company is suspended
pursuant to subdivision (e), each member of the limited liability
company shall be personally liable up to one million dollars
($1,000,000) each for damages resulting to third parties in
connection with the company’s performance, during the period of
suspension, of any act or contract when a license is required by
this chapter.

(g) This section shall remain in effect only until January 1, 2020,
and as of that date is repealed, unless a later enacted statute, that
is enacted before January 1, 2020, deletes or extends that date.

SEC. 4.  

Section 7525.1 of the Business and Professions Code
is amended to read:

7525.1.  

An application shall be verified and shall include:

(a) The full name and business address of the applicant.

(b) The name under which the applicant intends to do business.

(c) A statement as to the general nature of the business in which
the applicant intends to engage.

(d) A verified statement of his or her experience qualifications.

(e) (1) If the applicant is an individual, a qualified manager, begin insert a end insert
partner of a begin delete partnership or end delete begin insert partnership, an end insert officer of a corporation
designated in subdivision (h), begin insert or a managing member of a limited
liability company designated in subdivision (i), end insert one personal
identification form provided by the bureau upon which shall appear
a photograph taken within one year immediately preceding the
date of the filing of the application together with two legible sets
of fingerprints, one set of which shall be forwarded to the Federal
Bureau of Investigation for purposes of a background check, on a
form approved by the Department of Justice, and a personal
description of each person, respectively. The identification form
shall include residence addresses and employment history for the
previous five years and be signed under penalty of perjury.

(2) The bureau may impose a fee not to exceed three dollars
($3) for processing classifiable fingerprint cards submitted by
applicants, excluding those submitted into an electronic fingerprint
system using electronic fingerprint technology.

(f) In addition, if the applicant for a license is an individual, the
application shall list all other names known as or used during the
past 10 years and shall state that the applicant is to be personally
and actively in charge of the business for which the license is
sought, or if any other qualified manager is to be actively in charge
of the business, the application shall be subscribed, verified, and
signed by the applicant, under penalty of perjury, and if any other
person is to be actively in charge of the business, the application
shall also be subscribed, verified, and signed by that person under
penalty of perjury.

(g) If the applicants for license are copartners, the application
shall state the true names and addresses of all partners and the
name of the partner to be actively in charge of the business for
which the license is sought; and list all other names known as or
used during the past 10 years, or if a qualified manager other than
a partner is to be actively in charge of the business, then the
application shall be subscribed, verified, and signed by all of the
partners under penalty of perjury, and if any other person is to be
actively in charge of the business, the application shall also be
subscribed, verified, and signed by that person, under penalty of
perjury, under penalty of perjury by all of the partners and qualified
manager, or by all of the partners or the qualified manager.

(h) If the applicant for license is a corporation, the application
shall state the true names, and complete residence addresses of the
chief executive officer, secretary, chief financial officer, and any
other corporate officer who will be active in the business to be
licensed. The application shall also state the name and address of
the designated person to be actively in charge of the business for
which the license is sought. The application shall be subscribed,
verified, and signed by a duly authorized officer of the applicant
and by the qualified manager thereof, under penalty of perjury.

begin insert

(i) If the applicant for a license is a limited liability company,
the application shall state the true name and complete residence
address of each managing member and any other officer or member
who will be active in the business to be licensed. A copy of the
articles of organization issued by the Secretary of State shall be
supplied to the bureau upon request. The application shall also
state the name and residence address of the designated person to
be actively in charge of the business for which the license is sought.
The application shall be subscribed, verified, and signed by a duly
authorized member of the applicant under penalty of perjury.

end insert begin delete

(i)

end delete

begin insert (j) end insert  Any other information, evidence, statements, or documents
as may be required by the director.

begin insert

(k) This section shall remain in effect only until January 1, 2020,
and as of that date is repealed, unless a later enacted statute, that
is enacted before January 1, 2020, deletes or extends that date.

end insert

SEC. 5.  

Section 7525.1 is added to the Business and Professions
Code, to read:

7525.1.  

An application shall be verified and shall include:

(a) The full name and business address of the applicant.

(b) The name under which the applicant intends to do business.

(c) A statement as to the general nature of the business in which
the applicant intends to engage.

(d) A verified statement of his or her experience qualifications.

(e) (1) If the applicant is an individual, a qualified manager, a
partner of a partnership, or an officer of a corporation designated
in subdivision (h), one personal identification form provided by
the bureau upon which shall appear a photograph taken within one
year immediately preceding the date of the filing of the application
together with two legible sets of fingerprints, one set of which
shall be forwarded to the Federal Bureau of Investigation for
purposes of a background check, on a form approved by the
Department of Justice, and a personal description of each person,
respectively. The identification form shall include residence
addresses and employment history for the previous five years and
be signed under penalty of perjury.

(2) The bureau may impose a fee not to exceed three dollars
($3) for processing classifiable fingerprint cards submitted by
applicants, excluding those submitted into an electronic fingerprint
system using electronic fingerprint technology.

(f) In addition, if the applicant for a license is an individual, the
application shall list all other names known as or used during the
past 10 years and shall state that the applicant is to be personally
and actively in charge of the business for which the license is
sought, or if any other qualified manager is to be actively in charge
of the business, the application shall be subscribed, verified, and
signed by the applicant, under penalty of perjury, and if any other
person is to be actively in charge of the business, the application
shall also be subscribed, verified, and signed by that person under
penalty of perjury.

(g) If the applicants for license are copartners, the application
shall state the true names and addresses of all partners and the
name of the partner to be actively in charge of the business for
which the license is sought; and list all other names known as or
used during the past 10 years, or if a qualified manager other than
a partner is to be actively in charge of the business, then the
application shall be subscribed, verified, and signed by all of the
partners under penalty of perjury, and if any other person is to be
actively in charge of the business, the application shall also be
subscribed, verified, and signed by that person, under penalty of
perjury, under penalty of perjury by all of the partners and qualified
manager, or by all of the partners or the qualified manager.

(h) If the applicant for license is a corporation, the application
shall state the true names, and complete residence addresses of the
chief executive officer, secretary, chief financial officer, and any
other corporate officer who will be active in the business to be
licensed. The application shall also state the name and address of
the designated person to be actively in charge of the business for
which the license is sought. The application shall be subscribed,
verified, and signed by a duly authorized officer of the applicant
and by the qualified manager thereof, under penalty of perjury.

(i) Any other information, evidence, statements, or documents
as may be required by the director.

(j) This section shall become operative on January 1, 2020.

SEC. 6.  

Section 7529 of the Business and Professions Code is
amended to read:

7529.  

begin insert (a) end insert begin insert   end insert Upon the issuance of a license, a pocket card of the
size, design, and content as may be determined by the director
shall be issued by the bureau to each licensee, if an individual, or
if the licensee is a person other than an individual, to its begin insert managing
member or end insert manager and to each of its officers and partners. The
pocket card is evidence that the licensee is licensed pursuant to
this chapter. The card shall contain the signature of the licensee,
signature of the chief, and a photograph of the licensee, or bearer
of the card, if the licensee is other than an individual. The card
shall clearly state that the person is licensed as a private
investigator or is the manager or officer of the licensee. The pocket
card is to be composed of a durable material and may incorporate
technologically advanced security features. The bureau may charge
a fee sufficient to reimburse the department’s costs for furnishing
the pocket card. The fee charged may not exceed the actual direct
costs for system development, maintenance, and processing
necessary to provide this service, and begin delete may end delete begin insert shall end insert not exceed sixteen
dollars ($16). When a person to whom a card is issued terminates
his or her position, office, or association with the licensee, the card
shall be surrendered to the licensee and within five days thereafter
shall be mailed or delivered by the licensee to the bureau for
cancellation. Every person, while engaged in any activity for which
licensure is required, shall display his or her valid pocket card as
provided by regulation.

begin insert

(b) This section shall remain in effect only until January 1, 2020,
and as of that date is repealed, unless a later enacted statute, that
is enacted before January 1, 2020, deletes or extends that date.

end insert

SEC. 7.  

Section 7529 is added to the Business and Professions
Code, to read:

7529.  

(a) Upon the issuance of a license, a pocket card of the
size, design, and content as may be determined by the director
shall be issued by the bureau to each licensee, if an individual, or
if the licensee is a person other than an individual, to its manager
and to each of its officers and partners. The pocket card is evidence
that the licensee is licensed pursuant to this chapter. The card shall
contain the signature of the licensee, signature of the chief, and a
photograph of the licensee, or bearer of the card, if the licensee is
other than an individual. The card shall clearly state that the person
is licensed as a private investigator or is the manager or officer of
the licensee. The pocket card is to be composed of a durable
material and may incorporate technologically advanced security
features. The bureau may charge a fee sufficient to reimburse the
department’s costs for furnishing the pocket card. The fee charged
shall not exceed the actual direct costs for system development,
maintenance, and processing necessary to provide this service, and
shall not exceed sixteen dollars ($16). When a person to whom a
card is issued terminates his or her position, office, or association
with the licensee, the card shall be surrendered to the licensee and
within five days thereafter shall be mailed or delivered by the
licensee to the bureau for cancellation. Every person, while engaged
in any activity for which licensure is required, shall display his or
her valid pocket card as provided by regulation.

(b) This section shall become operative on January 1, 2020.

SEC. 8.  

Section 7538 of the Business and Professions Code is
amended to read:

7538.  

begin insert (a) end insert begin insert   end insert After a hearing the director may deny a license unless
the applicant makes a showing satisfactory to the director that the
applicant, if an individual, has not, or if the applicant is a person
other than an individual, that its manager and each of its officers
have not:

begin delete

(a)

end delete

begin insert (1) end insert  Committed any act, which, if committed by a licensee, would
be a ground for the suspension or revocation of a license under
this chapter.

begin delete

(b)

end delete

begin insert (2) end insert  Committed any act constituting dishonesty or fraud.

begin delete

(c)

end delete

begin insert (3) end insert  Committed any act or crime constituting grounds for denial
of licensure under Section 480, including illegally using, carrying,
or possessing a deadly weapon.

begin delete

(d)

end delete

begin insert (4) end insert  Been refused a license under this chapter or had a license
revoked.

begin delete

(e)

end delete

begin insert (5) end insert  Been an officer, partner, begin insert managing member, end insert or manager of
any person who has been refused a license under this chapter or
whose license has been revoked.

begin delete

(f)

end delete

begin insert (6) end insert  While unlicensed committed, or aided and abetted the
commission of, any act for which a license is required by this
chapter.

begin delete

(g)

end delete

begin insert (7) end insert  Knowingly made any false statement in his or her
application.

begin insert

(b) This section shall remain in effect only until January 1, 2020,
and as of that date is repealed, unless a later enacted statute, that
is enacted before January 1, 2020, deletes or extends that date.

end insert

SEC. 9.  

Section 7538 is added to the Business and Professions
Code, to read:

7538.  

(a) After a hearing the director may deny a license unless
the applicant makes a showing satisfactory to the director that the
applicant, if an individual, has not, or if the applicant is a person
other than an individual, that its manager and each of its officers
have not:

(1) Committed any act, which, if committed by a licensee, would
be a ground for the suspension or revocation of a license under
this chapter.

(2) Committed any act constituting dishonesty or fraud.

(3) Committed any act or crime constituting grounds for denial
of licensure under Section 480, including illegally using, carrying,
or possessing a deadly weapon.

(4) Been refused a license under this chapter or had a license
revoked.

(5) Been an officer, partner, or manager of any person who has
been refused a license under this chapter or whose license has been
revoked.

(6) While unlicensed committed, or aided and abetted the
commission of, any act for which a license is required by this
chapter.

(7) Knowingly made any false statement in his or her
application.

(b) This section shall become operative on January 1, 2020.

SEC. 10.  

Section 7538.5 of the Business and Professions Code
is amended to read:

7538.5.  

begin insert (a) end insert begin insert   end insert The director may refuse to issue any license
provided for in this chapter to any begin delete person end delete begin insert of the following end insert :

begin delete

(a) Who

end delete

begin insert (1) end insert   begin insert A person who end insert has had any license revoked, begin delete or whose license
is end delete begin insert has a license currently end insert under suspension, or begin delete has end delete failed to renew
his or her license while begin delete it was end delete under suspension.

begin delete

(b) If any

end delete

begin insert (2) end insert   begin insert A person who, while acting as a end insert member of begin delete any end delete begin insert a end insert
partnership, begin delete or any end delete begin insert an end insert officer or director of begin delete any end delete begin insert a end insert corporation, begin delete or
any end delete begin insert an end insert officer or person acting in a managerial capacity of begin delete any end delete begin insert a end insert
firm or begin delete association has had any license issued to him or her
revoked, or whose license is end delete begin insert association, or a managing member
of a limited liability company, had his or her license revoked, has
a license currently end insert under suspension, or begin delete who has end delete failed to renew
his or her license while begin delete it was end delete under suspension.

begin delete

(c) If any

end delete

begin insert (3) end insert   begin insert A person who, while acting as a end insert member of the partnership,
begin delete or any end delete begin insert an end insert officer or director of the corporation, or begin delete any end delete begin insert an end insert officer
or person acting in a managerial capacity of the firm or association,
begin delete was either a end delete begin insert meets both of the following conditions: end insert

begin insert (A) end insert begin insert   end insert begin insert He or she was a end insert member of any partnership, begin delete or end delete an officer
or director of any corporation, begin delete or end delete an officer or person acting in a
managerial capacity of any firm or association, begin insert or a managing
member of any limited liability company end insert whose license begin delete has been end delete
begin insert was end insert revoked, begin delete or whose license end delete is begin insert currently end insert under suspension, or
begin delete failed to renew a license end delete begin delete who end delete begin insert was not renewed end insert while begin delete it was under
suspension, and while acting end delete begin insert under suspension. end insert

begin insert (B) end insert begin insert   end insert begin insert While acting end insert as begin delete such end delete begin insert a end insert member, officer, director, or person
acting in a managerial begin delete capacity end delete begin insert capacity in any corporation, firm,
association, or limited liability company, he or she end insert participated in
any of the prohibited acts for which begin delete any such end delete begin insert the end insert license was
revoked or suspended.

begin insert

(b) This section shall remain in effect only until January 1, 2020,
and as of that date is repealed, unless a later enacted statute, that
is enacted before January 1, 2020, deletes or extends that date.

end insert

SEC. 11.  

Section 7538.5 is added to the Business and
Professions Code, to read:

7538.5.  

(a) The director may refuse to issue any license
provided for in this chapter to any of the following:

(1) A person who has had any license revoked, has a license
currently under suspension, or failed to renew his or her license
while under suspension.

(2) A person who, while acting as a member of a partnership,
an officer or director of a corporation, or an officer or person acting
in a managerial capacity of a firm or association, had his or her
license revoked, has a license currently under suspension, or failed
to renew his or her license while under suspension.

(3) A person who, while acting as a member of the partnership,
an officer or director of the corporation, or an officer or person
acting in a managerial capacity of the firm or association, meets
both of the following conditions:

(A) He or she was a member of any partnership, an officer or
director of any corporation, or an officer or person acting in a
managerial capacity of any firm or association, whose license was
revoked, is currently under suspension, or was not renewed while
under suspension.

(B) He or she, while acting as a member, officer, director, or
person acting in a managerial capacity in any corporation, firm,
or association, participated in any of the prohibited acts for which
the license was revoked or suspended.

(b) This section shall become operative on January 1, 2020.

SEC. 12.  

Section 7539 of the Business and Professions Code
is amended to read:

7539.  

(a) Any licensee or officer, director, partner, begin insert managing
member, end insert or manager of a licensee may divulge to any law
enforcement officer or district attorney, or his or her representative,
any information he or she may acquire as to any criminal offense,
but he or she shall not divulge to any other person, except as begin delete he
or she may be end delete begin insert otherwise end insert required by begin delete law so to do, end delete begin insert law, end insert any
information acquired by him or her except at the direction of the
employer or client for whom the information was obtained.

(b)  begin delete No end delete begin insert A end insert licensee or officer, director, partner, manager,
begin insert managing member, end insert or employee of a licensee shall begin insert not end insert knowingly
make any false report to his or her employer or client for whom
information was being obtained.

(c)  begin delete No end delete begin insert A end insert written report shall begin insert not end insert be submitted to a client except
by the licensee, qualifying manager, begin insert managing member, end insert or a person
authorized by one or either of them, and the person submitting the
report shall exercise diligence in ascertaining whether or not the
facts and information in the report are true and correct.

(d)  begin delete No end delete begin insert A end insert licensee, or officer, director, partner, manager,
begin insert managing member, end insert or employee of a licensee shall begin insert not end insert use a badge
in connection with the official activities of the licensee’s business.

(e)  begin delete No end delete begin insert A end insert licensee, or officer, director, partner, manager,
begin insert managing member, end insert or employee of a licensee, shall begin insert not end insert use a title,
or wear a uniform, or use an insignia, or use an identification card,
or make any statement with the intent to give an impression that
he or she is connected in any way with the federal government, a
state government, or any political subdivision of a state
government.

(f)  begin delete No end delete begin insert A end insert licensee, or officer, partner, qualified manager,
begin insert managing member, end insert or employee of a licensee shall begin insert not end insert use any
identification to indicate that he or she is licensed as a private
investigator other than the official identification card issued by
the bureau or the business card regularly used by the business.
However, a licensee may issue an employer identification card.

(g)  begin delete No end delete begin insert A end insert licensee, or officer, director, partner, manager,
begin insert managing member, end insert or employee of a licensee, shall begin insert not end insert enter any
private building or portion thereof, except premises commonly
accessible to the public, without the consent of the owner or of the
person in legal possession thereof.

(h)  begin delete No end delete begin insert A end insert licensee shall begin insert not end insert permit an employee or agent in his
or her own name to advertise, engage clients, furnish reports or
present bills to clients, or in any manner begin delete whatever end delete conduct business
for which a license is required under this chapter. All business of
the licensee shall be conducted in the name of and under the control
of the licensee.

(i)  begin delete No end delete begin insert A end insert licensee, officer, director, partner, manager, begin insert managing
member, end insert or employee of a licensee shall begin insert not end insert knowingly and directly
solicit employment from any person who has directly sustained
bodily injury or from that person’s spouse or other family member
to obtain authorization on behalf of the injured person as an
investigator to investigate the accident or act begin delete which end delete begin insert that end insert resulted
in injury or death to that person or damage to the property of that
person. Nothing in this subdivision shall prohibit the soliciting of
employment from that injured person’s attorney, insurance
company, self-insured administrator, insurance adjuster, employer,
or any other person having an indirect interest in the investigation
of the injury. This subdivision shall not apply to any business agent
or attorney employed by a labor organization. begin delete No end delete begin insert A end insert licensee,
officer, director, partner, begin insert managing member, end insert or manager of a
licensee shall begin insert not end insert pay or compensate any of his or her employees
or agents on the basis of a bonus, bounty, or quota system whereby
a premium is placed on the number of employer or client rule
violations or infractions purportedly discovered as a result of any
investigation made by a licensee.

(j)  begin delete No end delete begin insert A end insert licensee shall begin insert not end insert use a fictitious business name in
connection with the official activities of the licensee’s business,
except as provided by the bureau.

begin insert

(k) This section shall remain in effect only until January 1, 2020,
and as of that date is repealed, unless a later enacted statute, that
is enacted before January 1, 2020, deletes or extends that date.

end insert

SEC. 13.  

Section 7539 is added to the Business and Professions
Code, to read:

7539.  

(a) Any licensee or officer, director, partner, or manager
of a licensee may divulge to any law enforcement officer or district
attorney, or his or her representative, any information he or she
may acquire as to any criminal offense, but he or she shall not
divulge to any other person, except as otherwise required by law,
any information acquired by him or her except at the direction of
the employer or client for whom the information was obtained.

(b) A licensee or officer, director, partner, manager, or employee
of a licensee shall not knowingly make any false report to his or
her employer or client for whom information was being obtained.

(c) A written report shall not be submitted to a client except by
the licensee, qualifying manager, or a person authorized by one
or either of them, and the person submitting the report shall
exercise diligence in ascertaining whether or not the facts and
information in the report are true and correct.

(d) A licensee, or officer, director, partner, manager, or
employee of a licensee shall not use a badge in connection with
the official activities of the licensee’s business.

(e) A licensee, or officer, director, partner, manager, or employee
of a licensee, shall not use a title, or wear a uniform, or use an
insignia, or use an identification card, or make any statement with
the intent to give an impression that he or she is connected in any
way with the federal government, a state government, or any
political subdivision of a state government.

(f) A licensee, or officer, partner, qualified manager, or
employee of a licensee shall not use any identification to indicate
that he or she is licensed as a private investigator other than the
official identification card issued by the bureau or the business
card regularly used by the business. However, a licensee may issue
an employer identification card.

(g) A licensee, or officer, director, partner, manager, or
employee of a licensee, shall not enter any private building or
portion thereof, except premises commonly accessible to the public,
without the consent of the owner or of the person in legal
possession thereof.

(h) A licensee shall not permit an employee or agent in his or
her own name to advertise, engage clients, furnish reports or
present bills to clients, or in any manner conduct business for which
a license is required under this chapter. All business of the licensee
shall be conducted in the name of and under the control of the
licensee.

(i) A licensee, officer, director, partner, manager, or employee
of a licensee shall not knowingly and directly solicit employment
from any person who has directly sustained bodily injury or from
that person’s spouse or other family member to obtain authorization
on behalf of the injured person as an investigator to investigate
the accident or act that resulted in injury or death to that person or
damage to the property of that person. Nothing in this subdivision
shall prohibit the soliciting of employment from that injured
person’s attorney, insurance company, self-insured administrator,
insurance adjuster, employer, or any other person having an indirect
interest in the investigation of the injury. This subdivision shall
not apply to any business agent or attorney employed by a labor
organization. A licensee, officer, director, partner, or manager of
a licensee shall not pay or compensate any of his or her employees
or agents on the basis of a bonus, bounty, or quota system whereby
a premium is placed on the number of employer or client rule
violations or infractions purportedly discovered as a result of any
investigation made by a licensee.

(j) A licensee shall not use a fictitious business name in
connection with the official activities of the licensee’s business,
except as provided by the bureau.

(k) This section shall become operative on January 1, 2020.

SEC. 14.  

No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of
the Government Code, or changes the definition of a crime within
the meaning of Section 6 of Article XIII B of the California
Constitution.