August 14, 2022

Volume XII, Number 226

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August 12, 2022

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August 11, 2022

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California Regulator Seeks Comment on Reworking Consumer Complaint Rules

On May 20, the California DFPI released a Notice of Proposed Rulemaking seeking comment on implementing new rules to the California Consumer Financial Protection Law (CCFPL).

Previously, the CCFPL expanded the DFPI’s oversight authority to cover business activity it could not previously regulate including, but not limited to, debt collection, debt settlement, credit repair, check cashing, rent-to-own contracts, retail sales financing, consumer credit reporting, and lead generation. This new rule would allow the DFPI to establish reasonable procedures for covered persons to provide a timely response to consumers regarding complaints and inquiries aiming to protect consumers by ensuring covered persons have written policies and procedures in place regarding the handling of complaints and inquiries.

Specifically, the new rules would establish procedures for: responding to consumer complaints, initiating consumer complaints, the acknowledgment of receipt of complaints, the review and evaluation of complaints, the tracking of complaints, the response to complaints, the maintenance of a written record for each complaint, the administration of the complaint process without discrimination, and the reporting of complaints to the DFPI.

Comments are due by July 5.

Putting It Into Practice: The California Legislature intended for the CCFPL to protect consumers from discrimination and unfair, deceptive, and abusive acts and practices by covered persons in connection with financial products and services. This new rule aims to implement that intent by expanding the ability of the DFPI to improve accountability and transparency of financial services providers.

If implemented, this new rule would finally require covered persons to promptly respond to complaints and inquiries by responding to the issues raised by consumers and it would allow the DFPI to bring enforcement actions in violation of the proposed rule.

Copyright © 2022, Sheppard Mullin Richter & Hampton LLP.National Law Review, Volume XII, Number 158
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About this Author

Moorari Shah Bankruptcy Lawyer Sheppard Mullin Law Firm
Partner

Moorari Shah is a partner in the Finance and Bankruptcy Practice Group in the firm's Los Angeles and San Francisco offices. 

Areas of Practice

Moorari combines deep in-house and law firm experience to deliver practical, business-minded legal advice. He represents banks, fintechs, mortgage companies, auto lenders, and other nonbank institutions in transactional, licensing, regulatory compliance, and government enforcement matters covering mergers and acquisitions, consumer and commercial lending, equipment finance and leasing, and supervisory examinations,...

213-617-4171
A.J. S. Dhaliwal Bankruptcy Attorney Sheppard Mullin Washington DC
Associate

A.J. is an associate in the Finance and Bankruptcy Practice Group in the firm's Washington, D.C. office. 

A.J. has over a decade of experience helping banks, non-bank financial institutions, and other companies providing financial products and services in a wide range of matters including government enforcement actions, civil litigation, regulatory examinations, and internal investigations.

With a diversified regulatory, compliance, and enforcement background, A.J. counsels financial institutions in matters involving...

202-747-2323
Associate

Gabriel is an Associate on the Telecom team and the Co-Lead Associate on the Blockchain and Digital Assets team in the firm’s Washington, D.C. office. He is a Blockchain Law Professional as Certified by the Blockchain Council.

At Sheppard Mullin, Gabriel assists the Telecom team in all aspects of communications law and regulation including, satellites, spectrum, 5G implementation, media companies, and new technologies. He assists the Blockchain and Digital Assets team in legal issues relating to the use of blockchain technology, social media, internet, video games, online gambling,...

202-747-2194
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