The DFPI Consumer Connection | January 2023

Financial Wellness Free Webinar Series 

Financial Wellness Month is observed throughout January and was created to remind us to pay closer attention to our financial wellbeing. It comes right after the hustle, bustle, and spending that comes with the holiday season, helping us slow down and prepare our finances for the new year. In January, the Consumer Financial Protection Bureau (CFPB) will host Your Money, Your Goals, a free four-part webinar series to learn about financial empowerment and consumer protection resources. The webinars will be held on Thursdays (Jan. 5, 12, 19, and 26) from 3-4 p.m. EST. The series will focus on content related to financial wellbeing, consumer protection, cashflow, credit, debt, savings, and financial products. These free materials are easy to use and are available in print, electronic, and video formats. Register online. The registration form gives you an opportunity to order free hardcopy materials relevant to the training. For more information, email your questions to YourMoneyYourGoals@cfpb.gov.

Californians with Student Loans Updates

IDR & PSLF Account Adjustment: The Department of Education (ED) is currently conducting a one-time automatic account adjustment of Income Driven Repayment (IDR) and Public Student Loan Forgiveness (PSLF) payment credits that will count toward or get borrowers closer to forgiveness. The ED estimates that this action will result in automatic debt cancellation for at least 40,000 borrowers qualifying for PSLF and several thousand borrowers under IDR. More than 3.6 million borrowers will receive at least three years of additional credit toward forgiveness under IDR. The adjustment will be automatic, and no application is required. For details on this program and to find out whether your loans apply, visit StudentAid.gov. 

Student Borrower Bill of Rights: Californians with federal and private student loans have special protections provided by the Student Borrower Bill of Rights. Servicers are the borrower’s main point of contact when calling about their payments, forgiveness, and repayment options and they should be acting in the borrower’s best interest. If you have any questions about your rights, your servicer, or you are unsure if you should file a complaint, contact the DFPI’s Student Loan Servicing Ombudsperson, Celina Damian, at Celina.Damian@dfpi.ca.gov, where she will either answer your question directly or refer you to the appropriate resources you need to resolve your issue. 

DFPI Student Loan Resources: During the repayment pause extension and while the Supreme Court reviews legal challenges to the federal Student Debt Relief program, borrowers are encouraged to learn all they can about their loans and prepare for repayment. Check out the Back on Track Website for the most up to date information on student loans.  

File a Complaint: The DFPI is responsible for protecting consumers and ensuring financial service providers, like student loan servicers, are following the law. If you have been the victim of a student loan related scam, are having an issue with a loan servicer, or you suspect that you’ve been the victim of unfair, unlawful, deceptive, or abusive practices (UDAP), contact the DFPI toll-free at (866) 275-2677 or Ask.DFPI@dfpi.ca.gov or File a Complaint online. 

Start a ScholarShare 529 College Savings Plan 

As the cost of higher education continues to increase each year, saving extra money for college for your child or grandchild might feel expensive and out of reach. A California ScholarShare 529 college savings account makes saving money for college easy, and you don’t need a significant upfront investment to get started. Any dollar amount is enough to open an account and make after-tax contributions to allow earnings to grow tax deferred. Disbursements, when used for tuition and other qualified expenses, are federal and state tax free. To learn about the plan, research investments, and open an account, visit the ScholarShare 529 website. 

The DFPI partners with several state-sponsored education savings organizations. For additional resources, visit: 

• California Memorial Scholarship Program  

• California Kids and Investment Development Savings Program 

• California Student Aid Commission (CSAC)  

• Cash for College Program 

Tips for Tricky Buy Now, Pay Later Holiday Returns 

Shoppers who used Buy Now, Pay Later (BNPL) loans to help finance their holiday shopping may soon find that returns can be more challenging than buying from a store with cash or a credit card. Some providers voluntarily offer formal protection policies to reassure shoppers. However, returns can also be trickier with BNPL purchases since they may not come with the dispute provisions that apply to credits cards. Making a seamless return with BNPL isn’t impossible if you know the process ahead of time. Follow these helpful tips to maximize your chances of making a successful BNPL return. For details, read Tips for Tricky Buy Now, Pay Later Holiday Returns.

DFPI’s Commissioner Hewlett Named Person to Watch in Crypto 

The San Francisco Examiner named DFPI’s Commissioner Hewlett on a list of 10 People to Watch in the Crypto Showdown of 2023. As California is home to some of crypto’s most important companies, the crypto crisis has kept the DFPI under Commissioner Hewlett busy and the Department has been working to ensure any company flouting the state’s financial regulations will become a target.

Crypto: What You Should Know Right Now

The DFPI has opened multiple investigations in connection with crypto companies, including FTX, BlockFi, and Salt Lending LLC. Additionally, the DFPI took enforcement actions against companies that offer crypto interest accounts, including Voyager Digital LLC, Celsius Network Inc., and Nexo Group. The DFPI is regularly monitoring the most pressing crypto-related questions. Learn the facts about crypto assets and the DFPI’s oversight at Crypto: What You Should Know Right Now.

DFPI Consumer Alerts

The DFPI urges consumers to exercise extreme caution before responding to any solicitation offering investment, lender, or other financial services. To check whether an investment or financial service provider is licensed in California, consumers may contact the Department for questions or inquiries at ask.dfpi@dfpi.ca.gov or call toll-free at (866) 275-2677.  If you believe a person or company has violated state law or acted improperly regarding a consumer financial product or service, you may file a formal complaint on the DFPI’s File a Complaint webpage. 

Crypto Asset Broker/Website Scams: 

• The DFPI posted 30 consumer alerts in December related to crypto asset broker and website frauds and scams. For details, visit our Consumer Alerts webpage. 

Crypto Asset Platforms: 

• BlockFi Lending LLC (Dec. 19) - The DFPI moved to revoke BlockFi Lending LLC’s (BlockFi) California Financing Law (CFL) license as a result of its examination which found that the New Jersey-based finance lender failed to perform adequate underwriting when making loans and failed to consider borrower’s ability to repay these loans, in violation of California’s financing laws and regulations. 

• MyConstant (Dec. 21) - The DFPI ordered CONST LLC (a.k.a. MyConstant) to desist and refrain from violating the California Securities Law and California Consumer Financial Protection Law. MyConstant operated an online platform offering several crypto-related services and products including a peer-to-peer loan brokering service, interest-bearing crypto asset accounts, and interest-bearing fiat accounts. DFPI’s action found that MyConstant’s peer-to-peer lending services and interest-bearing accounts violated California law and ordered MyConstant to stop offering them in California. 

Lending and Debt Collection: 

• Moo Loans, LLC (Dec. 7) - Moo Loans, LLC, a former licensee under the California Financing Law (CFL), has been found continuing to collect on loans that had been declared void.