Compliance Bulletins

Compliance Bulletin

California’s New California Consumer Privacy Act

California’s new California Consumer Privacy Act of 2018 has received considerable attention, both statewide and nationwide. Commentators consider it the most sweeping law to date in this subject area. The Act, together with its subsequent amendment by SB 1121, is summarized in CBA’s Regulatory Compliance Bulletin, authored by CBA affiliate member Morrison & Foerster. The bulletin can be reviewed here.

Compliance Bulletin

New Law Relating to the Use of Background Checks

Signed into law by Governor Brown on September 30, 2018, SB 1412 amends California Labor Code Section 432.7, relating to the use of background checks.  As originally proposed, the requirements of the bill would have contradicted the requirements of the Federal Deposit Insurance Act, which restricts financial institutions’ ability to hire employees who have been convicted of certain crimes. CBA was able to negotiate language addressing this quandary, but financial institutions are still urged to proceed with caution. CBA’s Regulatory Compliance Bulletin disc

Compliance Bulletin

New Mandates for Board of Directors in California

On September 30, 2018, Governor Jerry Brown signed SB 826 into law. The bill adds provisions to the California Corporations Code mandating that the boards of directors of certain corporations include a specific number of women, and provides penalties for violation. CBA’s Regulatory Compliance Bulletin discussing the new law can be found here.

Compliance Bulletin

California Supreme Court Decision on Independent Contractors

The California Supreme Court decision in Dynamex Operations West, Inc. v. Superior Court has caused considerable furor in the business community. It departs from prior law by establishing a presumption that workers are employees rather than independent contractors, and puts the burden on the employer to establish that a worker is truly an independent contractor and not an employee entitled to typical worker protections.

Compliance Bulletin

CBA Summary of the Economic Growth, Regulatory Relief and Consumer Protection Act

The Economic Growth, Regulatory Relief and Consumer Protection Act, aka S.2155, was enacted just over four months ago. CBA is taking this opportunity to summarize some of the provisions of the Act, primarily to highlight those provisions that have been, or will be, the subject of agency rulemaking. CBA will continue to update you on the effect of S.2155 as rulemaking continues. CBA’s Regulatory Compliance Bulletin can be viewed here.

Compliance Bulletin

OCC Request for Comment: Proposed Rule Permitting Certain Federal Thrifts to Elect the Rights and Duties of National Banks

The OCC is inviting comment on proposed rules implementing a new section of HOLA that was enacted as part of S.2155. The new law would offer qualifying federal savings associations the opportunity to elect to operate as a “covered savings association,” such that they would be treated as national banks in certain respects without having to apply for a national bank charter. The OCC believes the new law, and the rules that it is now proposing, offer federal savings associations opportunities to increase, for example, commercial or consumer lending, and to better serve their communit

Compliance Bulletin

Agencies Acknowledge Exemptions to Certain HMDA Reporting Requirements for Small Lenders
July 13, 2018

On July 5, 2018 the Federal Reserve, the OCC and the FDIC each issued statements acknowledging partial exemptions from HMDA data reporting requirements that are set forth in the recently-enacted Economic Growth, Regulatory Relief, and Consumer Protection Act (S. 2155).

Please read CBA’s Regulatory Compliance Bulletin for additional information.

Compliance Bulletin

Agencies Raise Appraisal Threshold for CRE Transactions
April 10, 2018

Effective April 9, 2018, the Federal Reserve, the OCC and the FDIC each enacted a final rule increasing the threshold level at or below which appraisals are not required for commercial real estate transactions from $250,000 to $500,000, i.e., formal appraisals are not required for any commercial real estate transaction with a transaction value less than $500,000. A “commercial real estate transaction” is defined as a real estate-related financial transaction that is not secured by a single 1-to-4 family residential property.

Compliance Bulletin

Bill Creates New Real Estate Recording Fee
December 1, 2017

A bill enacted this year, SB 2, creates the “Building Homes and Jobs Act,” which promotes development of affordable housing across the state in part by imposing a new fee in connection with the recording of real estate instruments, papers, and notices. Proceeds go into a new state treasury fund called the Building Homes and Jobs Fund. Moneys collected will be made available to local governments and to the Department of Housing and Community Development. In addition to existing applicable recording fees, a fee of at least $75 is imposed at the time of recording (with a maximum of $225).

Compliance Bulletin

Congress Overturns CFPB’s Arbitration Regulation
November 3, 2017

With the Senate able to muster 51 votes to disapprove the CFPB’s arbitration regulation, which followed a similar action by the House of Representatives in July, that paved the way for the president to sign the joint resolution to make it official: the CFPB arbitration regulation is dead. The action was undertaken under the Congressional Review Act, which allows Congress to overturn a regulatory action through an expedited process.

Compliance Bulletin

New Bill Updates DBO Authority to Enforce Military Lending Act
October 30, 2017

A new California bill, SB 266, updates existing laws that give the Department of Business Oversight authority over California lenders’ compliance with the federal Military Lending Act (MLA). In 2015, Congress strengthened several provisions of the MLA by covering more types of transactions and enhancing disclosure requirements. SB 266 incorporates the 2015 changes.

 See CBA’s Regulatory Compliance Bulletin for more information.

Compliance Bulletin

New California Bill Restricts Criminal History Inquiry
October 30, 2017

A new bill, AB 1008, strictly regulates California employers’ ability to inquire about and use a job applicant’s conviction history. An inquiry is allowed only after a conditional offer of employment is made. The bill also creates procedural protections allowing the applicant to dispute information contained in a report. Importantly, an exemption is provided for any position that is subject to regulation by other laws.

Compliance Bulletin

New Bill Limits Employer Inquiry About Salary History
October 16, 2017

A new bill, AB 168, prohibits an employer from relying on the salary history information of an applicant for employment as a factor in the hiring decision and what salary to offer. The rationale for the new law is that the gender wage gap is exacerbated when employers inquire about salary history and thus are in a position to perpetuate past salary discrimination. An applicant may voluntarily (without prompting) disclose salary history information to a prospective employer, and in that case the employer may consider that information “in determining the salary for that applicant.”

Compliance Bulletin

Collateral Requirement for State Deposits Eased
October 9, 2017

A new bill, SB 363, decreases from 110% to 100% the value of collateral that a bank needs to pledge for state deposits if the collateral is a Federal Home Loan Bank (FHLB) letter of credit. The state Treasurer’s office considers FHLB letters of credit to have high credit quality and has come to prefer to take them as collateral when placing deposits with a bank. Under existing state law banks are required to pledge various forms of collateral in the amount of 110% of the amount of state deposits taken.

Compliance Bulletin

New California Bill Further Strengthens Borrow Protections in PACE Lending
October 9, 2017

New California bill further strengthens borrow protections in Property Assessed Clean Energy (PACE) lending. SB 242 was enacted in California that places a series of new requirements on PACE program administrators. These are third party administrators retained by public agencies to run the agency’s PACE program. Concerns have arisen because contractors who desire to perform the property improvements are also arranging the financing. SB 242 imposes a series of requirements intended to ensure that property owners understand the obligations that they are undertaking. 

Compliance Bulletin

New California Law Imposes More Discipline in PACE Lending
October 9, 2017

A new bill, AB 1284, addresses the problem of property assessed clean energy (PACE) loans being granted to homeowners without the protections normally associated with taking on mortgage-like obligations. The bill establishes underwriting standards and brings PACE program administrators, solicitors, and solicitor agents within the California Finance Lenders Law, renamed by this bill to the California Financing Law. This means that they will be subject to the Department of Business Oversight’s’ supervision and enforcement authorities.

Compliance Bulletin

CBA-Sponsored Bill Further Protects Elders and Dependent Adults from Financial Abuse
October 9, 2017

The governor signed a bill, AB 611, allowing mandated reporters of suspected financial abuse of elders and dependent adults to refuse to honor a power of attorney if the potential abuser wields a power of attorney to act on behalf of the person suspected of being abused. The mandated reporter may, but is not required to, refuse to honor a power of attorney if the reporter makes a report to an adult protective services agency or a local law enforcement agency of any state that the elder or dependent adult may be subject to financial abuse by that holder of the power.

Compliance Bulletin

Federal Appeals Court Issues Favorable Ruling Under the Telephone Consumer Protection Act
August 21, 2017

The Telephone Consumer Protection Act (TCPA) prohibits companies from initiating any telephone call to any residential telephone line using an artificial or prerecorded voice to deliver a messages without the prior express consent of the called party. In this case, Reyes v. Lincoln Automotive Financial Services, the court considered the novel question whether a consumer may revoke a consent to receive calls when that consent had been given as consideration under a contract.

Compliance Bulletin

Ninth Circuit Holds Holds Mortgage Underwriters Are Entitled to Overtime Pay
July 18, 2017

The Ninth Circuit has held that mortgage underwriters are entitled to overtime compensation under the Fair Labor Standards Act (“FLSA” or “the Act”), 29 U.S.C. § 201 et seq., for hours worked in excess of forty per week. The court’s decision in McKeen-Chaplin v. Provident Savings Bank, FSB (July 5, 2017) Case No. 15-16758, is particularly significant because two prior U.S. Courts of Appeals to consider the same issue reached different conclusions.

Compliance Bulletin

An Extraordinary Treatment of a Prepetition Loan Payment as an Avoidable Preference Payment
May 15, 2017

The CBA Legal Affairs Committee Chairman Ted Kitada, SVP, senior company counsel, Wells Fargo Bank, N.A., has prepared a Regulatory Compliance Bulletin discussing In re Tenderloin Health, where the Ninth Circuit Court addressed the treatment of a prepetition loan payment by a bank as an avoidable preference in a bankruptcy proceeding initiated by a trustee.