California Consumer Financial Protection Law
Protecting Consumers, Fostering Responsible Innovation
The California Consumer Financial Protection Law expanded the Department’s oversight to better protect consumers, keep up with emerging financial innovation, and spur responsible job growth. For the first time in its history, the DFPI can oversee providers of certain financial products and services previously unregulated by the Department, such as debt collectors, debt-relief companies, credit reporting agencies, consumer credit repair companies and others.
The law gives the Department expanded authority and resources to:
- Protect consumers from predatory businesses
- Spur responsible innovation in financial services by clarifying regulatory expectations for emerging products and services
- Oversee financial activity previously unregulated by our Department and keep up with emerging financial trends
- Increase public outreach and education to vulnerable populations
The new law created a Consumer Financial Protection Division, an Office of Financial Technology Innovation, and an Office of the Ombuds. The new Consumer Financial Protection Division will:
- License and examine debt collectors
- Supervise and register financial service providers previously unregulated by the DFPI
- Help conduct targeted outreach to communities historically underserved throughout the state
- Have a market monitoring and research arm to keep up with consumer trends.
The Office of Financial Technology Innovation provides early guidance to entrepreneurs developing financial products and services in California to spur job creation and safeguard consumers. The newly created Office of the Ombuds provides an impartial review of complaints and resolutions with a goal to improve and streamline department operations. The law was enacted in Assembly Bill 1864 sponsored by Assemblywoman Monique Limón, D-Santa Barbara.
What Does This Mean for Consumers?
The California Consumer Financial Protection Law gives the Department new tools to better protect consumers from unlawful, unfair, deceptive, and abusive practices.
Your state financial regulator can now oversee industries previously unregulated by the Department, including debt collectors, debt-relief companies, consumer credit reporting agencies, credit repair companies, and others.
We can now accept and investigate consumer complaints about a financial service provider that you think may be using unlawful, unfair, deceptive, or abusive practices. With a live call center and translation services in dozens of languages, you can contact us if you have questions, are having issues with a provider, or need to file a complaint. To file a complaint, please see the “File a Complaint” tab at the top of our website or follow the link below.
What Does This Mean For Businesses?
Under the California Consumer Financial Protection Law, the Department of Financial Protection and Innovation has expanded authority to oversee financial service and product providers it did not previously regulate.
These include, but are not limited to:
- Credit repair and consumer credit reporting companies
- Debt relief companies
- Debt collectors
- Private, for-profit school funding
Many industries will be required to register with the Department in the coming years. For additional information on what businesses will be required to register and ongoing rulemaking related to the California Consumer Financial Protection Law, visit our New Covered Persons page.
For more on the California Consumer Financial Protection Law (Assembly Bill 1864), visit the full bill text on the California Legislative Information website.
The DFPI is required to publish an annual report detailing actions taken under the Consumer Financial Protection Law, including rulemaking, enforcement, oversight, consumer complaints, education and research, and the activities of the Office of Financial Technology Innovation.
Translated Notices to Cosigner (SB 633)
Senate Bill 633 amended Civil Code section 1799.91 to require the Notice to Cosigner in Civil Code section 1799.91, subdivisions (a) and (d), to be provided to specified persons by creditors and lessors regardless of whether the persons are married to each other. Senate Bill 633 also expanded the languages that the notices are required to be translated into. In addition, Civil Code section 1799.91 now requires the Department of Financial Protection and Innovation to make translations of the notices available in the required languages on its website by January 1, 2023, and would require additional translations of any languages subsequently added to state law.
Below are the Notices to Cosigner required by Civil Code section 1799.91, subdivisions (a) and (d), in English and the languages set forth in Civil Code section 1632, subdivision (b).