Deferred deposit transactions.

Existing law, the California Deferred Deposit Transaction Law, provides for the licensure and regulation by the Commissioner of Corporations until July 1, 2013, and thereafter by the Senior Deputy Commissioner of Business Oversight for the Division of Corporations, of persons engaged in the business of originating or making deferred deposit transactions, as defined. Existing law requires a licensee to file an annual report with the commissioner, on or before March 15 of each year. Under existing law, the licensee's annual report is confidential and not open to public inspection. Existing law requires the commissioner to prepare an annual consolidated report based upon specified information received from licensees. Existing law authorizes the commissioner to suspend or revoke the license of a license that fails to file the annual report. Existing law makes a willful violation of the California Deferred Deposit Transaction Law a crime. Under existing law, a licensee may defer the deposit of a customer's check for up to 31 days, regardless of the check amount. Existing law requires a licensee to provide a notice to the customer regarding the deferred deposit transaction, containing specified information, including an example of all charges and fees that would be charged on at least a $100 and a $200 deferred deposit transaction, payable in 14 and 30 days, respectively. Existing law also authorizes a licensee to offer an extension of time, or a payment plan, for the repayment of a deferred deposit transaction under specified circumstances. This bill would revise the period for which a licensee could defer a customer's check, depending on the amount of the check. The bill would require the notification provided to the customer to set forth an example of charges and fees charged on a $100, $200, and $300 deferred deposit payable in 30, 60, or 90 days, respectively. The bill would impose specified underwriting duties on licensees, to determine a customer's likely ability to repay a deferred deposit transaction when due. The bill would also prohibit a licensee from entering into a deferred deposit transaction with a customer if it would result in the customer entering into more than 4 deferred deposit transactions in a 12-month period. This bill would delete existing repayment extension procedures, and instead require a licensee to offer an installment payment option, as specified, to a customer who notifies the licensee that he or she is unable to repay a deferred deposit transaction amount when due. The bill would delete the provisions that make a licensee's annual report to the commissioner confidential and exempt from public inspection. The bill would revise the required contents of the licensees' and commissioner's annual reports described above to include, among other things, prescribed information relating to installment plans entered into by a licensee. Existing law prohibits a licensee from entering into an agreement for a deferred deposit transaction with a customer during the period of time that an earlier written agreement for a deferred deposit transaction for the same customer is in effect. This bill instead would prohibit a licensee from entering into an agreement for a deferred deposit transaction with a customer during the period of time that an earlier written agreement for a deferred deposit transaction for the same customer is in effect with any licensee, as specified. This bill would require the commissioner to develop and implement a common database to provide licensees with real-time access, via an Internet connection, to specified information relating to deferred deposit transaction customers. Records in the database would not be open to public inspection. The bill would prescribe the duties of licensees, the database provider, and the commissioner in connection with the creation and operation of the database, and additionally would make various conforming changes. The bill would authorize the database provider, pursuant to rules adopted by the commissioner, to charge a fee for entering data into the database. Existing constitutional provisions require that a statute that limits the right of access to public bodies or the writings of public officials and agencies be adopted with findings demonstrating the interest protected by the limitation and the need for protecting that interest. This bill would make legislative findings to that effect. Because a willful violation of the bill's requirements would be a crime, the bill would impose a state-mandated local program. The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that no reimbursement is required by this act for a specified reason.