On August 31, 2020, the Ca legislature passed the Ca Consumer Financial Protection Law (CCFPL). What the law states reflects Governor NewsomвЂ™s eyesight of an infinitely more effective banking agency with brand brand new enrollment authority, UDAAP authority mirroring the authority of this CFPB, and expanded enforcement authority. But crucial amendments used by the legislature will exempt many regulated entities through the range regarding the legislation and can impose restrictions regarding the brand new Department of Financial Protection and InnovationвЂ™s (DFPI) workout of their authority.
We talk about the reorganization and expansion regarding the banking regulator that accompanies the true title modification to the DFPI within our companion client alert. We highlight the main element conditions for the CCFPL below.
Give attention to Customer Protection
The statutory purpose differs from the purpose and objectives of Dodd-Frank although most of the CCFPL comes directly from Dodd-Frank Act Title X. The legislative findings assert that вЂњlack of [a dedicated economic solutions regulator with broad authority over providers of financial loans and solutions] has left customers in danger of abuse and forced California businesses to compete with unscrupulous providers.вЂќ They relate to UDAAP also to discriminatory methods times that are multiple. Additionally they make reference to technological innovation that вЂњoffers great promise,вЂќ but in addition вЂњposes risks to consumer and challenges to police force.вЂќ
In comparison, the goals of Dodd-Frank Title X are much more balanced, talking about protecting customers from UDAAP and discrimination, but in addition: (a) the necessity for customers to possess promo code for funds joy loans prompt and understandable information to make accountable decisions; (b) the requirement to reduce unwarranted regulatory burdens; (c) constant enforcement of federal customer economic legislation to market fair competition and transparency; and (d) efficient operation of areas for consumer financial loans and services.