Monthly Bulletin – April 2023
Volume 10, Number 9
Greg Young Appointed Senior Deputy Commissioner for Corporations and Financial Institutions
On March 29, Governor Gavin Newsom announced the appointment of Greg Young of Martinez as Senior Deputy Commissioner of Corporations & Financial Institutions at DFPI. He joined the Department on March 30 and will be based in San Francisco.
Prior to his appointment, Greg served as Community Lending Manager at Umpqua Bank since 2021. He was a Life Agent at New York Life Insurance Company from 2019 to 2021 and a Vice President and Retail Sales Manager at Bank of America from 2016 to 2018.
Greg was a Vice President and Market Growth and Development Consultant at Wells Fargo from 2014 to 2016 after serving as a Corporate Social Responsibility Officer and several other positions with Wells Fargo since 2001. Greg was a Partner at ThinkFeelGrow from 2008 to 2011 and an Account Executive at American Express from 1997 to 2000. Greg was also a Labor Staff Assistant and Chief Legislative Clerk for the Office of Senator Edward M. Kennedy from 1994-1995.
Greg earned a Bachelor of Arts in Mass Communications from the University of California, Berkeley, a Master of Business Administration from Saint Mary’s College, and a Master of Arts in Counseling Psychology from the University of San Francisco. Greg is also a member of Kappa Alpha Psi Fraternity, Inc.
Daniel Quach Selected as DFPI Chief Information Officer
On April 5, Daniel Quach joined the DFPI as Chief Information Officer, based out of the San Francisco office.
Daniel has more than 20 years of experience in Information Technology (IT) management. He joins the DFPI from his current position as the Chief Information Officer (CIO) for the City and County of San Francisco (CCSF) Department of Homelessness and Supportive Housing where he was instrumental in building IT infrastructure for a newly created department from the ground up.
Prior to the Department of Homelessness, Daniel served as CIO for the CCSF Assessor-Recorder’s Office, where he was awarded the SPUR (SF Bay Area Planning and Urban Research Association) Good Government Award by the late Mayor Edwin M. Lee. Before joining CCSF, Daniel served as CIO for the California Public Utilities Commission (CPUC) and as an IT Operations Manager for the Department of Industrial Relations (DIR).
Daniel holds a Bachelor of Science in Accounting and a master’s degree in business administration and taxation from San Francisco State University. He is also a Microsoft Certified System Engineer and successfully completed a Cyberterrorism Defense training program sponsored by the Department of Homeland Security.
Introducing the DFPI Research Team
Over the last year, the DFPI has been building out its new data research and market monitoring functions as part of its efforts related to the California Consumer Financial Protection Law (CCFPL) implementation. The new Market Monitoring, Consumer Research, Insight and Analytics Unit (MMCRIA), established under the Consumer Financial Protection Division, will lead departmentwide efforts to deploy a data-driven approach to regulating consumer financial products and services. The MMCRIA Unit, also known as the Research Team, will have an instrumental role in the Department identifying trends and analyzing consumer behaviors from available data that will enhance consumers awareness and understanding of the costs, risks, and benefits of financial products and services. The unit’s research and market monitoring will aid in informing and developing consumer-focused, evidence-based policies and providing regulatory clarity for companies offering emerging, innovative financial products and services to California consumers. Led by Research Data Manager Dr. Dulce Medina, who joined the Department in September 2022, the Research Team is developing standards for conducting market research and best practices related to data research and analytics. Dr. Medina has assembled a diverse team of capable Senior Researchers, all based out of the Sacramento Office, who will perform complex data research and analytics for the DFPI. Team members include:
- Paul Whiteley, Ph.D.
- Suzanne Mann, Ph.D.
- Jeffrey “Jeff” Braverman
- Kaitlyn “Kait” Richards
- Yu Zhang, Ph.D.
Review of Silicon Valley Bank Oversight
On March 20, the DFPI announced: “The Department of Financial Protection and Innovation is conducting a comprehensive review of the department’s oversight and regulation of Silicon Valley Bank and will issue a report by early May 2023. Through this review, we will examine how we can strengthen and update our system of financial regulation to meet emerging and evolving challenges.”
The DFPI receives thousands of consumer and investor complaints each year. The tracker’s content is based on information reported by members of the public to the DFPI. The DFPI has not verified the losses reported by complainants. The announcement of the Crypto Scam Tracker received wide coverage with crypto-oriented media outlets and national news publications.
Crypto Lender BlockFi to Refund $100K
On March 27, the DFPI announced that New Jersey-based crypto lending platform BlockFi Lending LLC (BlockFi) agreed to direct its servicer to provide Californians more than $100,000 in refunds, subject to the bankruptcy court’s approval.
The refunds stem from BlockFi’s conduct following the crash of the FTX cryptocurrency exchange. On Nov. 10, 2022, BlockFi paused its platform and prohibited consumer withdrawals given its exposure to FTX. BlockFi subsequently filed a petition for chapter 11 bankruptcy on Nov. 28, 2022.
The DFPI investigation uncovered that the company failed to provide timely notification to borrowers that they could stop repaying their BlockFi loans. This resulted in California borrowers remitting at least $103,471 in loan repayments to BlockFi’s servicer while they were unable to withdraw funds and collateral from BlockFi’s platform. BlockFi recently filed a motion in the bankruptcy court, requesting permission to direct its servicer to return these loan repayments. The hearing is scheduled for April 19, 2023.
BDIA Online Examination due May 19
The Broker-Dealer / Investment Adviser (BDIA) Division is continuing an annual online examination for certain registered Investment Advisers, in accordance with DFPI’s authority under California Corporations Code section 25241, subdivision (c). This mandatory examination consists of an online examination for Investment Advisers registered with the DFPI, who have their principal place of business in another state.
The online examination for this year began on April 3. If selected, the advisory firm was notified on April 3 and is required to complete and submit the online examination by May 19, 2023. The Division is structuring the exam to be conducted on this population on a four-year cycle. However, an Investment Adviser may be selected for a future examination sooner or later than the estimated four-year cycle.
To communicate regarding the online examination, as well as any follow-up communication, the Division is using the Investment Adviser email address as disclosed on the current Form ADV. The business e-mail address must be dedicated to receiving DFPI communications and be monitored by the executive staff of your firm, to ensure prompt attention to communications from DFPI.
If you have any questions or inquiries, please contact the Division at CADFPIexams@dfpi.ca.gov.
Proposed CCFPL Regulations – Invitation for Comments
On March 17, 2023, the DFPI published a Notice of Proposed Rulemaking with the Office of Administrative Law and invited public comments on the proposed rulemaking.
The draft rules propose registration regulations for the following industries: Debt settlement, student debt relief, educating financing, and earned wage access. Required proposed requirements under the California Financing Law (CFL) were also published as part of the same package.
The Department is extending the close of the 45-day public comment period from Tuesday, May 2, to Wednesday, May 17, 2023, to provide interested persons more time to review and comment on the proposed regulations.
- PRO 01-21 – Notice of Proposed Action (PDF)
- PRO 01-21 – Text of Proposed Regulations (PDF)
- PRO 01-21 – Initial Statement of Reasons (PDF)
- PRO 01-21 – 2021 Earned Wage Access Data Findings (Cited in ISOR) (PDF)
Questions regarding the content of this notice may be directed to Peggy.Fairman@dfpi.ca.gov.
DFPI Launches 4th Round of CalMoneySmart Grants to Support Financial Education
On April 24, the DFPI will begin accepting applications for CalMoneySmart grants to support financial education and empowerment programs for unbanked and underbanked consumers in the state of California. This is the fourth year of grant funding. Last year, the program awarded nearly $2 million to twelve nonprofit organizations serving 27 counties across the state.
Organizations that support at-risk individuals to achieve economic self-sufficiency and build wealth are encouraged to apply. All CalMoneySmart applications must be submitted by May 26, 2023. The DFPI expects to announce the 2023-24 grantees in August.
Learn more about the accomplishments of grantees for the 2021-22 cycle in the recently published CalMoneySmart Annual Report.
Financial Literacy Month Event
In honor of National Financial Literacy Month (also known as Financial Capability Month) the DFPI is hosting a FREE webinar on April 26 from 11a.m. to 12:p.m. (PST). This popular annual event highlights resources for Californians for affordable financial services, homeownership, smart money management, and more. This year’s event will include remarks from DFPI Commissioner Clothilde Hewlett and feature a panel of experts discussing “Creating Wealth for All Californians” with an emphasis on generational wealth. Please visit our official webpage that highlights exhibitors and register for the event. Contact Katie Carruesco, Targeted Outreach Specialist, at Katie.Carruesco@dfpi.ca.gov for questions, to be an exhibitor, or to update your previous exhibitor information.
Debt Collection Advisory Committee Meeting on May 1
The Debt Collection Advisory Committee advises Commissioner Clothilde V. Hewlett on matters related to the debt collection business, including proposed fee schedules and other requirements. The next meeting of the Debt Collection Advisory Committee will be held Monday, May 1, 2023, from 10 a.m. to 12 p.m. Zoom webinar registration and further details will be posted to the Debt Collection Advisory Committee Page by April 21, 2023.
Report on Bank and Credit Union Fee Income from Nonsufficient Funds and Overdraft Charges
The 2022 Annual Report of Income from Fees on Nonsufficient Funds and Overdraft Charges is available on the DFPI website. Background on the law and the reporting process is posted here, including a FAQ.
Updated Franchise Disclosure Handbook Available from NASAA
In March, the DFPI and the North American Securities Administrators Association (NASAA) announced the availability of an updated publication designed to improve the quality of franchise disclosures. The 391-page Franchise Disclosure Handbook is a compilation of the various rules, commentaries, and guidance from the Federal Trade Commission and NASAA governing the preparation of Franchise Disclosure Documents. These disclosure documents are presented to prospective buyers of franchises as part of the purchasing process. The NASAA Franchise Disclosure Handbook is available for purchase on Amazon for $24.99. For additional information, please visit the DFPI website to lean What’s New in 2023 for Franchisors or email DFPI at SRD_SUPPORT@dfpi.ca.gov.
Premium Finance Company Activity
Acquisition of Control
Summit Acquisition Inc. to acquire control of CPF Columbia Pacific Finance
Money Transmitter Activity
Acquisition of Control
Green Check Verified, Inc. to acquire control of PayQwick, Inc.
Neon NewCo Corporation, to acquire control of Netspend Corporation
Change of Name
eMoola, Inc. to change its name to Checkout US, Inc.
CLOTHILDE V. HEWLETT Commissioner, Department of Financial Protection and Innovation
The April 2023 Monthly Bulletin covers the month ended March 31, 2023.
It is issued pursuant to Financial Code section 376.
The Monthly Bulletin is available at no charge via e-mail.
To subscribe, go to: https://public.govdelivery.com/accounts/CADFI/subscriber/new.