BILL NUMBER: AB 764	INTRODUCED
	BILL TEXT


INTRODUCED BY   Assembly Member Nava

                        FEBRUARY 26, 2009

   An act to amend Sections 10085 and 10085.5 of the Business and
Professions Code, relating to real estate brokers.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 764, as introduced, Nava. Real estate brokers.
   The Real Estate Law provides for the regulation and licensure of
real estate brokers and real estate salespersons by the Real Estate
Commissioner. Existing law authorizes the commissioner to require
that materials used in obtaining advance fee agreements be submitted
to him or her at least 10 calendar days before the materials are
used. Existing law authorizes the commissioner to determine the form
of the advance fee agreements.
   This bill would instead require the commissioner to determine the
form of advance fee agreements and to mandate the submission of
advance fee agreement materials prior to their use.
   The Real Estate Law makes it unlawful for any person to claim,
demand, charge, receive, collect, or contract for an advance fee for
soliciting lenders on behalf of borrowers or performing services for
borrowers in connection with a mortgage loan before the borrower
becomes obligated to complete the loan and for performing any other
activity for which a license is required, unless the person is a
licensed real estate broker and has complied with the provisions of
the Real Estate Law. A violation of that provision constitutes a
public offense punishable by a fine of up to $10,000 for an
individual or $50,000 for a corporation.
   This bill would increase those fines to $20,000 and $60,000,
respectively. The bill would also make it unlawful for any person to
claim, demand, charge, receive, collect, or contract for any fee for
performing services for borrowers in connection with the modification
of the terms of a mortgage loan, unless the person is a licensed
real estate broker. By creating a new crime, the bill would impose 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 10085 of the Business and Professions Code is
amended to read:
   10085.  The commissioner  may   shall 
require that any or all materials used in obtaining advance fee
agreements, including but not limited to the contract forms, letters
or cards used to solicit prospective sellers, and radio and
television advertising be submitted to him or her at least 10
calendar days before they are used. Should the commissioner determine
that any such matter, when used alone or with any other matter,
would tend to mislead  ,  he or she may, within 10 calendar
days of the date he or she receives same, order that it not be used,
disseminated, nor published. Any person using, disseminating, or
publishing any matter  which   that  the
commissioner has ordered, pursuant to this section, not to be used,
published, or disseminated shall be guilty of a misdemeanor
punishable by a fine not exceeding one thousand dollars ($1,000) or
by imprisonment in the county jail not exceeding six months, or both,
for each  such  use, dissemination, or publication.

   The commissioner  may   shall  determine
the form of the advance fee agreements, and all material used in
soliciting prospective owners and sellers shall be used in the form
and manner which he or she determines is necessary to carry out the
purposes and intent of this part.
   Any violation of any of the provisions of this part or of the
rules, regulations, orders or requirements of the commissioner
thereunder shall constitute grounds for disciplinary action against a
licensee, or for proceedings under Section 10081  of this
code  , or both. These sanctions are in addition to the
criminal proceedings hereinbefore provided.
  SEC. 2.  Section 10085.5 of the Business and Professions Code is
amended to read:
   10085.5.  (a) It shall be unlawful for any person to claim,
demand, charge, receive, collect, or contract for an advance fee (1)
for soliciting lenders on behalf of borrowers or performing services
for borrowers in connection with loans to be secured directly or
collaterally by a lien on real property, before the borrower becomes
obligated to complete the loan or, (2) for performing any other
activities for which a license is required, unless the person is a
licensed real estate broker and has complied with the provisions of
this part. 
   (b) It shall be unlawful for any person to claim, demand, charge,
receive, collect, or contract for any fee for performing services for
borrowers in connection with the modification of the terms of a loan
secured directly or collaterally by a lien on single-family
residential real property, unless the person is a licensed real
estate broker.  
   (b) 
    (c)  This section does not prohibit the acceptance or
receipt of  an advance   any  fee by
 any   a bank, savings association, credit
union, industrial loan company, or person acting within the scope of
a license issued to that person pursuant to Division 9 (commencing
with Section 22000) of the Financial Code, in connection with loans
to be secured directly or collaterally by a lien on real property
 or in connection with the modification of the terms of a loan
secured directly or collaterally by a lien on single-family
residential real property  . This section does not apply to
charges made by title insurers and controlled escrow companies
pursuant to Chapter 1 (commencing with Section 12340) of Part 6 of
Division 2 of the Insurance Code. 
   (c) 
    (d)  A violation of this section is a public offense
punishable by a fine not exceeding  ten   twenty
 thousand dollars  ($10,000)   ($20,000)
 , by imprisonment in the county jail for a term not to exceed
six months, or by both that fine and imprisonment, or if by a
corporation, the violation is punishable by a fine not exceeding
 fifty   sixty  thousand dollars 
($50,000)   ($60,000)  .
  SEC. 3.  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.