Monthly Bulletin – September 2019

Training Conference Planned for Broker-Dealer Examiners

The California Department of Business Oversight (DBO), Financial Industry Regulatory Authority (FINRA), and North American Securities Administrators Association (NASAA) are bringing state securities regulators together on September 26 for a joint conference on training for broker-dealer examiners.

This collaborative, one-day event will focus on strategies and solutions to help examiners strengthen their exam skills.

The session will be held at:

Omni Los Angeles Hotel at California Plaza
251 South Olive Street
Los Angeles CA 90012

The conference is free, although attendance is limited to 160 on a first-come, first-served basis. Those who register should receive an email confirmation. Please make sure your registration has been confirmed prior to arrival.

For registration questions, visit the conference page on the FINRA website. FINRA also has posted a brochure including the agenda.

CSBS Launches New Fintech Tools for Banking

The Conference of State Bank Supervisors (CSBS) has launched three new online tools to help the industry navigate the state regulatory system and protect against cyber risks. The tools are:

• A portal of state agency guidance for nonbank financial services companies.
• An interactive map of agent-of-the-payee exemptions from money transmission laws.
• A new cybersecurity 101 resource center for banks and nonbanks alike.

The state regulatory guidance portal will help nonbanks keep up to date with state regulatory guidance.

The interactive map for what are known as agent-of-the-payee exemptions identifies states that do not require a money transmitter license to receive a payment on behalf of a third party. The map includes state-by-state summaries of exemption requirements.

The cybersecurity 101 resource center offers a non-technical guide and related information to help financial institutions develop comprehensive cybersecurity programs.

The tools are part of CSBS Vision 2020, a roadmap of initiatives to modernize nonbank licensing and supervision.

Federal Exam Council Encourages Standard Approach to Assess Cybersecurity Preparedness

On Aug. 28, the Federal Financial Institutions Examination Council (FFIEC) issued a statement emphasizing the benefits of using a standardized approach to assess and improve cybersecurity preparedness.

The council noted that firms that adopt a standardized approach are better able to track their progress over time and share information and best practices with other financial institutions and regulators.

Institutions may choose from a variety of standardized tools aligned with industry standards and best practices to assess their cybersecurity preparedness. These include:

• FFIEC Cybersecurity Assessment Tool
• National Institute of Standards and Technology Cybersecurity Framework
• Financial Services Sector Coordinating Council Cybersecurity Profile
• Center for Internet Security Critical Security Controls

While the FFIEC does not endorse any particular approach, these standardized tools all support institutions’ self-assessment activities. The tools are not examination programs and the FFIEC members take a risk-focused approach to examinations. As cyber risk evolves, examiners may address areas not covered by all tools.

Suspicious Emails with DBO Return Address Reported

On Aug. 30, employees of several licensees informed the Department of Business Oversight they had received suspicious emails with the return address of a department examiner, Haben Hagos.

The DBO conducted an internal investigation and confirmed that the emails contained a link to a website that may contain malicious software or attempt to steal login passwords from visitors. The emails were sent by someone outside the DBO and were crafted to appear to be legitimate emails from the DBO examiner. The DBO regrets any inconvenience this may have caused.

If you receive a suspicious email from the department, do not open it. Please contact [email protected].

For more information on past alerts please go to the DBO Consumer Alert page.

Reminder: State Treasurer Time Deposit Program

The State Treasurer’s Office (STO) has issued a reminder to commercial banks and credit unions that they can apply to receive funds through the Time Deposit Program administered by the STO. As of June 30, the program had $4.9 billion in deposits with 69 participating financial institutions.

Among its benefits, the program:

• Enables financial institutions that might not otherwise compete for state moneys through other short-term investment options to receive substantial deposits.
• Provides a stable source of funding at attractive rates.
• Is user-friendly, with easy administrative and professional interactions.
• Stimulates growth in small businesses, home mortgages, auto loans, personal loans and other lending throughout the state.

For more information, contact Evelyn Gorman or Sean Collier in the STO’s Investment Division at 916-653-3147 or [email protected].

License Activity

Commercial Bank Activity

Merger

First State Bank of Colorado, Greenwood Village, Colorado, to merge with and into United Business Bank, Walnut Creek
Filed: 8/15/19

Rabobank, N.A., Roseville, to merge with and into Mechanics Bank, Walnut Creek
Effected: 8/31/19

Presidio Bank, San Francisco, to merge with and into Heritage Bank of Commerce, San Jose
Approved: 8/13/19

Acquisition of Control

US Metro Bancorp, Garden Grove, to acquire control of US Metro Bank, Garden Grove
Approved: 8/19/19

Premium Finance Company Activity

New Premium Finance Company

Biz Premium Finance Corp.
6200 Canoga Avenue, Woodland Hills
Opened: 8/15/19

C & A Funding, Inc.
600 West Broadway, San Diego
Effected: 8/1/19

Mojave Financial Corp.
6200 Canoga Avenue, Woodland Hills
Approved: 8/1/19

National Premium Finance, Inc.
1081 Westwood Boulevard, Los Angeles
Withdrawn: 7/25/19

Foreign (Other State) Bank Activity

New Facility

Boston Partners Trust Company
100 Drakes Landing Road, Greenbrae (Facility – Uninsured Trust Company)
Approved: 8/08/19
Opened: 8/10/19

Inland Bank and Trust
52 San Bonifacio, Rancho Santa Margarita (Facility – Insured Bank)
No Objection: 8/16/19

Paramount Bank
11801 Pierce Street, Riverside (Facility – Insured Bank)
No Objection: 8/14/19
Opened: 5/15/19

Trust Company Activity

New Trust Company

Peninsula Bay Trust Company
577 Airport Drive, Burlingame
Approved: 8/13/19

Money Transmitter Activity

New Money Transmitter

AvidXchange, Inc.
Opened: 8/19/19

PingPong Global Solutions Inc.
Opened: 8/21/19