BILL ANALYSIS Ó AB 2667 Page 1 Date of Hearing: May 14, 2014 ASSEMBLY COMMITTEE ON APPROPRIATIONS Mike Gatto, Chair AB 2667 (Bloom) - As Amended: April 24, 2014 Policy Committee: JudiciaryVote:10-0 B&P 14-0 Urgency: No State Mandated Local Program: Yes Reimbursable: No SUMMARY This bill: 1)Prohibits the use of geophysical location tracking technology by lessors under rental-purchase agreements absent express notice and consent, and then only for the purpose of providing remote technical assistance and preventing fraud or loss. 2)Requires that lessors in rental-purchase agreements give clear and prominent notice when geophysical location tracking or monitoring technology is installed or activated. FISCAL EFFECT Potential minor nonreimbursable costs to counties for prosecution, offset to some extent by fine revenues. (Violations of rental purchase agreement statutes are a misdemeanor.) COMMENTS Purpose . According to the author, rental-purchase agreements, typically referred to as "rent to own" agreements, are increasingly pervasive, especially regarding electronic devices such as lap top computers. Due to the lack of threshold consumer protections in this area, however, it has become fertile ground for abuse. This bill requires that, before a lessor of electronic devices can track the whereabouts of their customers, they must provide the consumer notice and the opportunity to consent. The use of tracking technology would be allowed for providing remote technical assistance to consumers AB 2667 Page 2 and preventing loss through fraud, recognizing the rent-to-own industry's legitimate uses of such technology for these functions. According to the author, this bill is needed to stem the abuse of monitoring and geophysical location tracking technology in electronic devices leased under rental-purchase agreements. Under current law, lessors under rental-purchase agreements are not prohibited from requesting security deposit fees to insure against fraud or loss. The author states that consumers have a reasonable expectation that lessors will use security deposits to insure against any losses that may occur in the course of the rental-purchase transaction, and that they will not be secretly spied upon as an unknown cost of participating in the rent-to-own marketplace. Analysis Prepared by : Chuck Nicol / APPR. / (916) 319-2081