California Deferred Deposit Transaction Law.

The California Deferred Deposit Transaction Law provides for the licensure and regulation by the Commissioner of Business Oversight of persons engaged in the business of making or arranging deferred deposit transactions. Existing law, among other things, 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. A knowing and willful violation of the provisions of this law is a crime. This bill would require the commissioner, by July 1, 2021, to develop, operate, and maintain an internet website and common database in which a licensee would be required to, by the time period described below, record each deferred deposit transaction for the purpose of preventing violations of the California Deferred Deposit Transaction Law. The bill would require the database to meet certain requirements, including that it allow real-time access to information entered into the database via an internet connection. The bill would, alternatively, authorize the commissioner to contract with a provider to develop, operate, or maintain the database. The bill would require, on or after July 1, 2021, a licensee to conduct a search on the database before entering into any deferred deposit transaction, and would prohibit the licensee from entering into that transaction if the database reveals the customer has any outstanding deferred deposit transactions or has taken out 4 or more deferred deposit transactions in the preceding 365 days. The bill would require the licensee to adhere to generally accepted security safeguards to maintain the confidentiality and security of information transmitted to the database. By expanding the scope of an existing crime, this bill would impose a state-mandated local program. The bill would provide that the information contained in the database is confidential and not subject to public inspection, and the database and its contents are not subject to requests under the California Public Records Act, except as specified. Existing constitutional provisions require that a statute that limits the right of access to the meetings of 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. 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.