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Beware of Online Advice About Creating Your Own “Private Bank” in California

Jan 26, 2023

The Department of Financial Protection and Innovation (DFPI), which regulates state-chartered banks and credit unions in California has learned of an individual or individuals on YouTube claiming that individuals can form their own “private banks” and become “individual bankers” to obtain various benefits including asset protection by obtaining a registration number from the DFPI. While the DFPI makes no comment in this Consumer Alert about such a “strategy,” the DFPI does not issue registration numbers to individuals to form their own private bank. Individuals have not been allowed to form their own private banks for well over a century (since 1909 in fact.)

While certain federal and state-chartered banks have been allowed to use the terms “private bank” or “private banking,” (which generally describes the business practice where a licensed bank offers its customers personalized financial services and products), the DFPI does not allow individuals to register themselves as a private bank. Furthermore, the DFPI notes that the term “individual banker” as used in such context does not have any particular legal significance in the State of California.

The DFPI urges consumers to exercise caution before responding to any solicitation offering financial services. To check whether a California financial service provider is licensed in California, or to file a complaint, consumers should go to the DFPI website at or call 1-866-275-2677.

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Last updated: Jan 26, 2023 @ 3:08 pm