February 27, 2021

Volume XI, Number 58

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DFPI Rings In The New Year By Issuing A Dozen Subpoenas

Yesterday, the Department of Financial Protection and Innovation announced that it had issued "subpoenas to a dozen companies with significant California customer bases, representing the first major action to be taken under the expanded oversight and enforcement authority of the California Consumer Financial Protection Law (CCFPL)".   The CCFPL, AB 1864 (2020 Cal. Stats. ch. 157),  grants the DFPI has broad investigative powers, including the power to issue subpoenas pursuant to California Government Code Sections 11180 - 11191. 

A year ago, the California Court of Appeal upheld  the authority of the State Water Resources Control Board to issue investigative subpoenas pursuant to these same statutes in State Water Resources Control Bd. v. Baldwin & Sons, Inc., 45 Cal. App. 5th 40 (2020).   Citing the California Supreme Court's decision in Brovelli v. Superior Court, 56 Cal. 2d 524 (1961), Justice Patricia Guerrero found that to be valid, the agency's subpoenas must:

  • Inquire into matters the agency is authorized to investigate;

  • Not be too indefinite; and

  • Seek information reasonably relevant to the investigation.

It is interesting that the DFPI has chosen to target an industry that it does not yet license.  Debt collectors are not subject to licensing by the DFPI until next year pursuant to SB 908 which was also enacted last year (SB 908, 2020 Cal. Stats. ch. 163).  

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© 2010-2020 Allen Matkins Leck Gamble Mallory & Natsis LLP National Law Review, Volume XI, Number 20
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About this Author

Keith Paul Bishop, Corporate Transactions Lawyer, finance securities attorney, Allen Matkins Law Firm
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Keith Bishop works with privately held and publicly traded companies on federal and state corporate and securities transactions, compliance, and governance matters. He is highly-regarded for his in-depth knowledge of the distinctive corporate and regulatory requirements faced by corporations in the state of California.

While many law firms have a great deal of expertise in federal or Delaware corporate law, Keith’s specific focus on California corporate and securities law is uncommon. A former California state regulator of securities and financial institutions, Keith has decades of...

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