BILL ANALYSIS
AB 1373
Page 1
Date of Hearing: August 24, 2010
ASSEMBLY COMMITTEE ON BUSINESS, PROFESSIONS AND CONSUMER
PROTECTION
Mary Hayashi, Chair
AB 1373 (Lieu) - As Amended: June 29, 2010
SUMMARY : Prohibits grant deed copy services from making any
untrue or misleading statements in connection with obtaining a
copy of a grant deed or misrepresenting that the copy service is
a governmental entity or affiliated with such an entity, and
requires specific disclosures informing homeowners that they may
obtain a copy of their grant deed directly from the county
recorder. Specifically, this bill :
1)Makes it unlawful for any person, firm, corporation,
association, or any other business entity to make any untrue
or misleading statements in any manner in connection with the
offering or performance of a grant deed copy service.
2)Defines "untrue or misleading statement" as including any
representation, with regard to property identified by its
address or assessor's parcel number that any of the following
is true:
a) That due to property foreclosures and loan modifications in
the county where the property is located, the property
owner should obtain a copy of his or her grand deed or
other record of title;
b) That a governmental entity, or any other entity that includes
in its name words that could lead a person to reasonably
believe that the entity is affiliated with government, has
recommended that a property owner should have a copy of his
or her grant deed or other record of title;
c) That the offeror of the grant deed copy service is, or is
affiliated with, any government entity. Provides that a
violation of this provision includes, but is not limited
to, the following:
i) The misleading use of any governmental seal, emblem,
or other similar symbol;
ii) The use of a business name including the words "title,"
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"grant deed," or "public record" and the word "agency,"
"bureau," "department," "division," "federal," "state,"
"county," "city," or "municipal," or the name of any
city, county, city and county, or any governmental
entity;
iii) The use of an envelope that simulates an envelope
containing a government check, tax bill, or government
notice or has the capacity to be confused with, or
mistaken for, an envelope sent by a governmental entity;
or,
iv) The use of an envelope or outside cover or wrapper in which
a solicitation is mailed that does not bear on its face
in capital letters and in conspicuous and legible type
the following: "THIS IS NOT A GOVERNMENT APPROVED OR
AUTHORIZED DOCUMENT."
d) That there is a fee payment deadline to obtain a copy of a
property owner's grant deed or other record of title.
3)Makes it unlawful to offer to perform a grant deed copy
service without making the following disclosure: "THIS SERVICE
TO OBTAIN A COPY OF YOUR GRANT DEED OR OTHER RECORD OF TITLE
IS NOT ASSOCIATED WITH ANY GOVERNMENTAL AGENCY. YOU CAN
OBTAIN A COPY OF YOUR GRANT DEED OR OTHER RECORD OF TITLE FROM
THE COUNTY RECORDER IN THE COUNTY WHERE YOUR PROPERTY IS
LOCATED FOR [AMOUNT OF FEE FOR THE COPY OF A GRANT DEED OR
OTHER RECORD OF TITLE IN THAT COUNTY]."
4)Specifies that the disclosure outlined in 3) above shall be:
a) Placed at the top of each page of every advertisement or
promotional material disseminated by an offeror of a grant
deed copy service, printed in 14-point boldface type
enclosed in a box formed by a heavy line, and recited at
the beginning of every oral solicitation; and,
b) Recited at the beginning of every oral solicitation and
broadcast advertisement and delivered in printed form as
prescribed above before the time each person who responds
to the oral solicitation or broadcast advertisement is
obligated to pay for the service.
5)Defines "grant deed copy service" to mean a service offered by
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a person, firm, corporation, association, or any other
business entity, through a mailed solicitation to a property
owner, to obtain, for compensation, a copy of the property
owner's grant deed or other record of title.
EXISTING LAW provides that certain advertising-related practices
are unlawful and makes a violation of those provisions a crime.
FISCAL EFFECT : Unknown
COMMENTS :
Purpose of this bill . According to the author's office, "In the
wake of California's mortgage and foreclosure meltdown, numerous
scam artists sought to take advantage of homeowners by sending
solicitations in the mail offering various 'services' for an
upfront fee. The solicitations were designed to look like they
came from an official government agency. In response, the
Legislature enacted several new consumer protection laws that
protect homeowners from deceptive advertising and restrict the
ability of companies to charge up front fees.
"However, homeowners are once again receiving official looking
letters offering a 'service' that is entirely unnecessary and
already available for free, or for a nominal charge, without any
needed assistance from a third-party. This time the mailings
are focused on grant deeds. The official looking notices inform
homeowners that they need to obtain a certified copy of their
grant deed, and they should complete the attached order form
with their processing fee of up to several hundred dollars.
"AB 1373 will prevent these deceptive letters from looking like
government documents and require mandatory disclosures informing
homeowners they can obtain grant deed copies from their county
recorder."
Background . A grant deed is given to a property owner
immediately following the close of escrow. If a homeowner needs
a copy of his or her grant deed, he or she can get one for a
nominal fee by contacting their local recorder's office, or they
can usually receive one for free from their title company.
Support . The County Recorders' Association of California writes
in support, "Californians need protection from misleading
solicitations that can lead to consumer fraud. County recorders
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believe that clear and accurate information is the appropriate
protection. AB 1373 ensures such information is provided to
California's homeowners. AB 1373 makes it unlawful for
solicitors to make false or misleading statements that would
induce the public to pay a fee for a grant deed copy service or
compensation in connection with obtaining a copy from the county
recorder absent specific disclosures. Entities offering grant
deed copy service may do so only when making the proper
disclosures required by AB 1373."
Related legislation . AB 992 (Lieu), Chapter 496, Statutes of
2009, recasts provisions in existing law relating to property
assessment appeal filing services by (1) removing an exemption
for
persons who actively advocate, thus including those individuals
within the definition of an assessment reduction filing service;
(2) prohibiting any statement that a late fee is required if a
person fails to respond to a solicitation by a specified date;
(3) clarifying the prohibition on an assessment reduction filing
service charging, demanding, or collecting advance fees, as
specified; (4) clarifying the definition of "assessment
reduction filing service" to include the providing of comparable
sales information in connection with an application or request
for reduction; (5) making it unlawful to file a request or
application for an assessment reduction without obtaining a
written authorization from the property owner; (6) requiring a
copy of that authorization to be submitted with any
request or application for reduction in assessment; and (7)
requiring the offer or to maintain the original written
authorization for a period of three years and require it to be
available for inspection and copying, as specified.
Previous legislation . AB 1178 (Davis), Chapter 249, Statutes of
1997, prohibited certain deceptive advertising practices related
to services which offer to file either a property tax
homeowners' exemption, or a property tax assessment appeal.
REGISTERED SUPPORT / OPPOSITION :
Support
California Association of Realtors
County Recorders' Association of California
Opposition
AB 1373
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None on file.
Analysis Prepared by : Rebecca May / B.,P. & C.P. / (916)
319-3301