Monthly Bulletin – February 2022
Volume 9, Number 7
DFPI Sues to Stop Precious Metals Fraud
Part of a nationwide effort, the DFPI, in partnership with the federal Commodity Futures Trading Commission (CFTC) and 26 other state regulators, filed a federal lawsuit earlier this month in Los Angeles against a precious metals dealer and its owner for perpetrating a $68 million fraudulent scheme that targeted the elderly.
Safeguard Metals LLC and its principal and owner, Jeffrey Santulan, also known as Jeffrey Hill, are charged with having engaged in ongoing fraud to solicit approximately $68 million in funds from more than 450 individuals nationwide to purchase fraudulently overpriced metals and coins from its office in Southern California. The lawsuit alleges that Safeguard Metals used false statements on its website, inflating its assets by billions and using fear tactics to motivate senior citizens to purchase the precious metals.
Contents
Some Escrow Reports Due February 14
2021 Escrow Annual Liability Report Due February 15
CRMLA Annual Reports Due March 1
CFL Annual Reports for Calendar Year 2021 Due March 15
CDDTL Annual Report and Industry Survey Due March 15
Student Loan Servicing Annual Reports Due March 15
New Staff for DFPI Market Monitoring, Consumer Research, Insight & Analytics
Commissioner Issues Broker-Dealer/Investment Adviser Program Report
Joint Action on Mortgage Loan Originators Education
Led by the DFPI, dozens of financial regulators across the country reached settlements with more than 400 mortgage loan originators nationwide who deceptively claimed to have completed annual continuing education as required under state and federal law. A media call and press release was organized by the Conference of State Bank Supervisors (CSBS) on Jan. 18 to share the news with media partners.
Danny Yen, owner of Carlsbad, Calif.-based course provider Real Estate Educational Services, settled with DFPI and the states of Oregon and Maryland on Feb. 2. Yen is facing other administrative enforcement actions for both providing false certificates and taking courses on behalf of mortgage loan originators through other education providers in violation of the Secure and Fair Enforcement for Mortgage Licensing Act (SAFE Act).
Through the settlements, the mortgage loan originators have agreed to surrender their licenses for a period of three months, pay a fine of $1,000 for each state in which he or she holds a license and take continuing education beyond federal and state SAFE Act requirements.
Rent-to-Own Furniture Startup Agrees to Refunds
In its first action against a rent-to-own firm violating the CCFPL, the DFPI finalized a settlement on Jan. 10 with Los Angeles-based rent-to-own furniture provider Fernished, Inc., doing business as Fernish. Based on DFPI’s investigation, the DFPI found that Fernish overcharged consumers late payment fees and failed to provide consumer disclosures required under California’s rent-to-own law (the Karnette Rental-Purchase Act) in violation of the CCFPL, which became operative this year. As part of the settlement, Fernish agrees to desist and refrain from violating the CCFPL, refund at least 387 customers overcharges, and to begin offering its rent-to-own products and services in compliance with the Karnette Rental-Purchase Act.
Some Escrow Reports Due February 14
Each escrow agent licensee is required to submit to the Commissioner of the Department an annual report prepared by an independent certified public accountant or an independent public accountant (Financial Code section 17406) within 105 days after the close of the escrow agent’s fiscal year. The annual report includes audited financial statements and required supplemental information.
If your fiscal year ended on Oct. 31, 2021, your annual report is due Feb. 14, 2022. Please have your CPA email your report to ESCAnnualReportFiling@dfpi.ca.gov by the deadline using a secured encrypted delivery system. The use of a secured dropbox is also acceptable. If your CPA is unable to submit the annual report electronically, it can be mailed to Sultanna Wan, Senior Financial Institutions Examiner, Escrow Law, Department of Financial Protection and Innovation, 320 West Fourth St., Suite 750, Los Angeles, CA 90013.
Penalties for failure to file the annual report by the due date or to include required information are $100 per day for the first five days a report is late and $500 per day thereafter (Financial Code section 17408). Failure to file a report or to include any required information may also result in the suspension or revocation of an escrow agent’s license and/or prompt an immediate examination (Financial Code section 17602.5).
For questions about the annual reports, call Sultanna Wan at (213) 576-7647.
2021 Escrow Annual Liability Report Due February 15
All escrow agents licensed prior to Jan. 1, 2022, must submit an Annual Liability Report to the Commissioner. The Annual Liability Report form is available on DFPI’s website here. The deadline to submit the Annual Liability Report electronically is Feb. 15, 2022.
Escrow licensees are required to have a registered DFPI portal account to submit the Annual Liability Report. To register for a portal account, go to DFPI’s website here.
Failure to submit the Annual Liability Report by the deadline may result in monetary penalties pursuant to Financial Code section 17408. If you have any questions, please email Escrow.Licensing@dfpi.ca.gov.
CRMLA Annual Reports Due March 1
Licensees under the California Residential Mortgage Lending Act (CRMLA) must file their 2021 annual report electronically by March 1.
A notice about the CRMLA annual report filing was sent to each licensee’s designated email address. The annual report must be completed by signing into the DFPI self-service portal.
All CRMLA licensees must file the report by March 1. No extensions will be granted. Missing the deadline may result in penalty assessments. Failure to file constitutes grounds for license revocation.
Email any questions to CRMLA.Licensing@dfpi.ca.gov.
CFL Annual Reports for Calendar Year 2021 Due March 15
All DFPI California Financing Law (CFL) licensees are required to submit an annual report on or before March 15, 2022, even if the licensee had no business activity in the calendar year 2021. The Department strongly recommends licensees start gathering the data now to ensure they can timely file their 2021 Annual Report.
The CFL annual report is required pursuant to Financial Code section 22159(a). Failure to submit the annual report by the due date will result in penalties pursuant to Financial Code section Financial Code section 22715(b).
The form and instructions for submitting the annual report are available on the DFPI’s website here. Annual reports must be submitted electronically through the DFPI portal account. To sign in to or register for a portal account, go to the DFPI’s website. If you have questions about your portal account, please contact the Account Administrator (Albert Mercado) at (213) 220-5140 or email Albert.Mercado@dfpi.ca.gov.
For questions about the content of the report or clarification on the instructions, please email CFL.Inquiries@dfpi.ca.gov or call (866) 275-2677.
CDDTL Annual Report and Industry Survey Due March 15
All California Deferred Deposit Transaction Law (CDDTL) licensees must submit a 2020 Annual Report and Industry Survey to the DFPI by March 15.
The Annual Report and Industry Survey must be completed online through the DFPI self-service portal. To prepare and submit the required reports, all CDDTL licensees are required to have a registered DFPI portal account.
The Annual Report and Industry Survey are required by California Financial Code sections 23026 and 23015. If you have questions, or need clarification on the instructions, please email RespondToCDDTL@dfpi.ca.gov.
Student Loan Servicing Annual Reports Due March 15
Pursuant to Financial Code section 28146(a) of the Student Loan Servicing Act, student loan servicers are required to file an annual report with the Commissioner of Financial Protection and Innovation by March 15.
Annual reports must be completed on the DFPI’s website via your self-service portal account labeled Student Loan Servicing Annual Report under the “Your Reports” section. Paper or mailed submissions will not be accepted. The Commissioner may impose a financial penalty if a licensee fails to submit a report on time.
Licensees with questions about the Student Loan Servicing report should send an email to studentloanservicing@dfpi.ca.gov.
New Staff for DFPI Market Monitoring, Consumer Research, Insight & Analytics
The DFPI has hired Krista Christian and Dr. Paul Whiteley as Senior Researchers in the Market Monitoring, Consumer Research, Insight & Analytics Unit within the Consumer Financial Protection Division. These positions were created under the California Consumer Financial Protection Law (CCFPL). They will be responsible for monitoring CCFPL financial consumer products and services, performing complex research and data analytics, and playing an instrumental role in developing the research office.
Krista Christian comes from the Department of Corrections and Rehabilitation, where she was a Research Data Specialist II on the Research Oversight Committee within the Office of Research. She has a Master’s Degree in business from CSU East Bay and holds a Bachelor of Science degree in business marketing from San Jose State University. With over 15 years of research experience, Krista brings her expertise in data management systems, data quality control, carrying out complex data analytics using SQL and SAS extracts, evaluating effectiveness, and collecting data.
Dr. Paul Whiteley comes from the Department of Corrections and Rehabilitation as well, where he was a Research Data Specialist II in the Office of Research. Dr. Whiteley holds a Ph.D. in Organizational Psychology from UC Riverside, and a Bachelor of Arts degree in Psychology from California State University Fullerton. Dr. Whiteley brings more than 10 years of research experience using data analytic software and visualization tools to report findings for the California Department of Social Services, private sector, and academia.
Both Krista and Dr. Whiteley started on Jan. 18 and will be based out of the Sacramento DFPI office.
Commissioner Issues Broker-Dealer/Investment Adviser Program Report
The DFPI has posted the 2022 Report on the Broker-Dealer/Investment Adviser Program as required by the Budget Act of 2014. The report is due to the Legislature and Department of Finance by Jan. 10 of each year.
The report includes information on the number of positions authorized and filled, the number and share of licensees examined, outcomes of examinations, and estimated staffing levels needed to meet statutorily-required examination cycles.
LICENSEE ACTIVITY
Commercial Bank Activity
Merger
Suncrest Bank, Visalia, to merge with and into Citizens Business Bank, Ontario
Effected: 1/07/22
Acquisition of Control
American Riviera Bancorp, to acquire control of American Riviera Bank
Approved: 1/14/22
Shaul Kopelowitz, to acquire control of Pacific Enterprise Bank
Withdrawn: 1/26/22
Purchase of Partial Business Unit
Royal Business Bank, to acquire the banking business of the Honolulu branch of Bank of the Orient
Effected: 1/14/22
Sale of Partial Business Unit
Bank of the Orient, to sell the banking business of its Hawaii branch to Royal Business Bank
Effected: 1/14/22
Mission Bank, to sell the banking business of its Ridgecrest Business Banking Center, to AltaOne Federal Credit Union
Filed: 1/04/22
Credit Union Activity
New Credit Union
Common Bond Credit Union
2661 E Florence Avenue, Huntington Park
Filed: 12/20/21
Merger
Barstow Community Credit Union, Barstow, to merge with and into Frontwave Credit Union, Oceanside
Filed: 1/31/22
My Credit Union, Redwood City, to merge with and into San Francisco Federal Credit Union, San Francisco
Approved: 8/12/21
Effected: 1/01/22
Pomona Postal Federal Credit Union, Pomona, to merge with and into Credit Union of Southern California, Anaheim
Effected: 01/01/22
Premier Community Credit Union, Stockton, to merge with and into Self-Help Federal Credit Union, Durham, North Carolina
Filed: 12/09/21
Premium Finance Company Activity
New Premium Finance Company
Ascend California
955 Alma Street, Palo Alto
Approved: 01/12/22
EVT Premium Finance, Inc.
660 Newport Center Drive, Newport Beach
Opened: 1/07/22
Integrated Premium Funding Corp
1811 Aston Avenue, Carlsbad
Opened: 1/03/22
Ultimate Premium Finance, INC.
411 W. Lambert Rd, Brea, Orange County
Opened: 1/17/22
Acquisition of Control
Insurance Installment Services, Inc. a Texas Corporation, to acquire control of Insurance Installment Services, Inc.
Filed: 7/26/21
Approved: 11/29/21
Foreign (Other Nation) Bank Activity
New Office
BAWAG P.S.K. Bank für Arbeit und Wirtschaft und Österreichische Postsparkasse Aktiengesellschaft
521 Boccaccio Avenue, Venice (Representative Office)
Opened: 1/21/22
Money Transmitter Activity
New Transmitter
Global Primex, LLC
Withdrawn: 1/05/22
Acquisition of Control
Banco Inter S.A., to acquire control of Pronto Money Transfer Inc.
Filed: 12/02/21
Approved: 1/10/22
Convera Bidco Limited, to acquire control of Western Union Business Solutions (USA), LLC
Approved: 1/20/22
Change of Name
Tempus, Inc. to change its name to Monex Inc.
Effected: 1/25/22
Voluntary Suspension of Operations
The Department of Financial Protection and Innovation (DFPI) has been notified that Moneydart Global Services Inc. has voluntarily suspended all money transmission operations in California effective December 15, 2020, through April 31, 2022. Consumers may contact Shanti Om Bade at 732-582-6416 ext. 132 or by e-mail at shantiom.bade@moneydart.com.
CLOTHILDE V. HEWLETT Commissioner, Department of Financial Protection and Innovation
The February 2022 Monthly Bulletin covers the month ended January 31, 2022.
It is issued pursuant to Financial Code section 376.
The Monthly Bulletin is available at no charge via e-mail.
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