Consumers: financial protection.

Senators Limón and Grayson advance a targeted refinement of California’s consumer financial protection regime, weaving the authors’ policy aim of clarifying exemptions with the ongoing authority to police deceptive or abusive practices under the state’s consumer protection framework. The core change reworks how exemptions operate within the department’s regulatory division, while preserving the DFPI commissioner’s ability to enforce prohibitions on deceptive or abusive acts.

Key mechanisms establish a cross-agency exemption for licensees acting under a non-DFPI state license and enumerate a set of DFPI-issued licenses that may qualify for exemptions. The enumerated categories cover escrow agents; finance lenders, brokers, program administrators, or mortgage loan originators; broker-dealers or investment advisers; residential mortgage lenders, servicers, or originators; check sellers, bill payers, or proraters; capital access companies; and any entity operating under a license, charter, or certificate issued under the Financial Institutions Law. Importantly, the bill preserves the commissioner’s authority to enforce the California Consumer Financial Protection Law’s prohibitions against deceptive or abusive practices even where an exemption applies. In addition, banks and related federally or state-regulated institutions remain exempt when acting under their respective licenses, while all other “covered persons” remain subject to the division’s reach.

Implementation and context considerations note that enforcement remains the DFPI’s remit, with explicit preservation of authority under the consumer-protection provisions notwithstanding exemptions. The text does not specify an explicit effective date or new appropriation, and a fiscal committee review is indicated. The changes affect a broad set of licensees across multiple DFPI divisions and federally/state-regulated institutions, while continuing to protect California consumers through the underlying framework of the California Consumer Financial Protection Law.