BILL ANALYSIS Ó
AB 1446
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Date of Hearing: April 27, 2015
ASSEMBLY COMMITTEE ON BANKING AND FINANCE
Matthew Dababneh, Chair
AB 1446
(Dababneh) - As Amended April 20, 2015
SUBJECT: California Finance Lenders Law: violations
SUMMARY: Clarifies the authority of the commissioner of the
Department of Business Oversight (DBO) to issue desist and
refrain orders against licensees under the California Finance
Lenders Law (CFLL). Specifically, this bill:
1)Specifies that the commissioner may order a person engaged as
a broker, finance lender, or mortgage loan originator to
desist and refrain from violations of a provision of an order
or any regulation adopted under the CFLL.
EXISTING LAW:
1)"Finance lenders" making loans in California are required to
obtain a license from DBO and comply with the licensing and
regulatory requirements of the CFLL (Financial Code, Sections
22000-22780) and the regulations thereunder. A "finance
lender" is broadly defined in Cal. Fin. Code § 22009 as "any
person who is engaged in the business of making consumer loans
or making commercial loans.
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2)Authorizes a de minimis exemption under the CFLL for persons
who make no more than one commercial loan in a 12-month period
(Financial Code Section 22050).
3)Prohibits a person subject to the CFLL from doing either of
the following:
a) Making a materially false or misleading statement or
representation to a borrower about the terms or conditions
of that borrower's loan, when making or brokering the loan
(Financial Code Section 22161); or,
b) Advertising, printing, displaying, publishing,
distributing, broadcasting, or causing or permitting to be
advertised, printed, displayed, published, distributed, or
broadcast in any manner, any statement or representation
that is false, misleading, or deceptive, or that omits
material information, as specified (Section 22161).
4)Provides that any person who willfully violates any provisions
of the CFLL, or who willfully violates any rule or order
adopted pursuant to the CFLL, is liable for a civil penalty
not to exceed two thousand five hundred dollars ($2,500) for
each violation, which must be assessed and recovered in a
civil action brought in the name of the people of the State of
California by the commissioner in any court of competent
jurisdiction (Section 22173).
5)Provides that whenever, in the opinion of the commissioner,
any person is engaged in the business as a broker or finance
lender, or a mortgage loan originator, without a license from
the commissioner, or any licensee is violating any provision
of the CFLL, the commissioner may order that person or
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licensee to desist and to refrain from engaging in the
business or further violating the CFLL. If a written request
for a hearing is filed by the recipient of an order within 30
days after the order is served, and no hearing is held within
30 days thereafter, the order is rescinded (Section 22712).
FISCAL EFFECT: Unknown
COMMENTS:
AB 1446 is a technical bill designed to clarify DBO's authority
that rules and regulations promulgated under the CFLL are
enforceable against licensees engaged in real estate
transactions.
REGISTERED SUPPORT / OPPOSITION:
Support
None on file.
Opposition
None on file.
AB 1446
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Analysis Prepared by:Mark Farouk / B. & F. / (916) 319-3081