On September 24, California enacted a series of consumer protection laws, including three bills aimed specifically at restricting certain debt collection practices in connection with medical debt reporting, civil actions for money judgments, and commercial debt collection.Continue Reading California Expands Debt Collection Protections for Small Businesses and Consumers
On September 4, the California Privacy Protection Agency (“CPPA”) issued an Enforcement Advisory cautioning businesses against the use of “dark patterns” in their consumer-facing user interfaces. The California Consumer Privacy
Continue Reading California Regulator Cautions Businesses Against the Use of Dark Patterns
On May 3, a California resident filed a class action lawsuit in federal court accusing a Los Angeles-based credit union of discriminatory practices, and raised a civil rights claim under 42 U.S.C. § 1981, and violations of the California’s Unruh Civil Rights Act. In the complaint, the plaintiff alleges his automobile loan application was unfairly denied because of his immigration status as a Deferred Action for Childhood Arrivals (DACA) recipient.Continue Reading DACA Recipient Accuses California Credit Union of ECOA Violations
On February 22, California Attorney General Rob Bonta sent letters to 197 state-charted banks and credit unions warning them that certain fees they charge may constitute “unfair” business practices under California’s Unfair Competition Law and the federal Consumer Financial Protection Act. Bonta encouraged the financial institutions to review their policies and procedures to ensure consumers were not being assessed these fees.Continue Reading California AG Warns State-Chartered Banks and Credit Unions on Fees
On February 7, a Florida-based cryptocurrency company agreed to settle charges brought by the SEC and the California Department of Financial Protection and Innovation alleging that, an interest-earning feature offered on the company’s platform, constitutes an illegal securities offering.Continue Reading Crypto Platform Settles SEC and State Regulator Charges over Interest Bearing Feature on Customer Accounts
California has recently proposed legislation that, if enacted, would impose a new licensing requirement for any person providing “commercial brokerage” services to a borrower in connection with a commercial loan of $5,000 or more. The legislation, Senate Bill 869, would expand the current commercial loan broker licensing requirements under the California Financing Law, which, as of now, does not require a license to broker non-real estate secured commercial loans.Continue Reading California Bill Proposes to License All Commercial Loan Brokers
On December 4, Judge R. Gary Klausner of the U.S. District Court for the Central District of California granted summary judgment to California’s DFPI upholding the recently adopted commercial financing disclosure regulations related to the implementation of SB 1235 (we blogged about the rule here). The regulations require small business financing providers to disclose key metrics to small businesses to help them understand potential financing options, including the amount of funding provided, APR, finance charge, and payment amounts. The plaintiffs in this latest challenge – a trade association of small business finance companies – asserted that the disclosure requirements violated plaintiffs’ free speech rights under the First Amendment and that the disclosures were preempted by the Truth in Lending Act (TILA).Continue Reading Federal Judge Upholds California’s Small-business Lending Disclosures
On October 30, the Superior Court of California County of Los Angeles denied the DFPI’s motion for a preliminary injunction to force a Chicago-based fintech company to stop facilitating loans to California borrowers from its bank partner at interest rates above California’s interest rate cap (generally 36% for loans less than $10,000) (we previously discussed this case here and here).Continue Reading California Court Denies DFPI’s Motion for Preliminary Injunction Against Fintech
A number of state and federal regulators, bolstered by messaging from the Biden administration, have embarked on a concerted campaign to address so-called “junk fees.” Continue Reading CFPB, FTC, California Make Significant Moves on “Junk Fees”
Recently, the California Department of Financial Protection and Innovation (DFPI) approved the final rule implementing and interpreting certain sections of the California Consumer Financial Protection Law (CCFPL) that prohibit persons from engaging in unfair, deceptive, or abusive acts or practices (UDAAP) related to commercial financial products and services and establishes data collection and reporting requirements.Continue Reading California DFPI Finalizes Small Business UDAAP Rule