What's New Postings -2012

  • 12/19/12 - The California Corporations Commissioner proposes to adopt section 1718.1 of Title 10 of the California Code of Regulations.  This proposed rulemaking action clarifies the Escrow Law’s requirements for a surety bond that is required of escrow agents for licensure.  The period within which to comment on this proposed regulatory action ends on February 11, 2013. (PRO 13-12)
  • 12/07/12 - The California Corporations Commissioner proposes to adopt and amend various sections of Title 10 of the California Code of Regulations.  This regulatory action proposes to (1) amend license and renewal license application forms under the Corporate Securities Law of 1968 (broker-dealers, agents, investment advisers), the California Finance Lenders Law, the California Residential Mortgage Lending Act, and the Securities Depository Law regarding AB 1424 (deny, or suspend licenses of certain delinquent taxpayers); (2) amend the application for a license under the California Finance Lenders Law regarding operating subsidiaries, reporting of past criminal acts and other violations, and self-certification for passive investors; and (3) adopt the annual report form under the California Finance Lenders Law.  The period within which to comment on this proposed regulatory action ends on January 28, 2013. 
  • 12/05/12 - The Commissioner or Corporations issued Commissioner’s Bulletin No. 001-12, regarding the emergence of third-party risk management companies and potential violations of licensing laws.  
  • 12/05/12 - Pursuant to Corporations Code section 25102.2 (added by Stats. 2012, ch. 669), the California Corporations Commissioner has issued Release 121-C to provide information regarding the new filing requirements for certain securities issuers relying on the securities qualification exemption under Corporations Code section 25102, subdivisions (e), (f), (h) or (n), and Corporations Code section 25100, subdivision (p).   Effective January 1, 2013, securities issuers and offerings meeting all of the conditions set forth in Release 121-C are required to file additional information with the Department of Corporations.  For more information, please see the additional requirements announcement and the form.
  • 12/04/12 - The Commissioner of Corporations has issued Release 65-FS to advise mortgage servicers of the new foreclosure laws effective January 1, 2013, including the landmark California Foreclosure Reduction Act (AB 268 (Ch. 86, Stats. 2012) and SB 900 (Ch. 87, Stats. 2012)), which reforms the foreclosure process.
  • 11/30/12 - The California Corporations Commissioner has issued Release 64-FS to provide information to mortgage loan originators (MLOs) who are employed by bona fide nonprofit organizations, and who may be exempt from licensure requirements under Financial Code Section 22013(b) of the California Finance Lenders Law and Financial Code Section 50003.5(b) of the California Residential Mortgage Lending Act, as amended by AB 2666 (Chap. 264, Stats. 2012), effective January 1, 2013.   For an MLO to qualify for the exemption, the bona fide nonprofit organization employer must register with the Department.  The California Corporations Commissioner has posted the form and instructions for filing.
  • 11/19/12 - The next Escrow Law Advisory Committee meeting will be on Tuesday December 4, 2012 at 10:00 A.M. The meeting will be held at the Department of Corporations' Los Angeles office located at 320 West Fourth Street, 7th Floor Conference Room. Agenda  The minutes of the September 13, 2012 meeting are now available.
  • The 2011 Annual Report of Operation of Deferred Deposit Originators is now available on our website.
  • 11/13/12 - The 2011 Annual Report of Operations of Finance Companies Licensed under the California Finance Lenders Law is available on our website. This report is based on unaudited data presented by Licensees and is primarily statistical in nature.
  • 10/29/12 -The California Corporations Commissioner proposes to amend Section 260.237 of Title 10 of the California Code of Regulations.  This proposed rulemaking action incorporates provisions from the Securities and Exchange Commission’s custody rule adopted under the Investment Advisers Act of 1940, and the adopted North American Securities Administrators Association Model Custody Rule.  The period within which to comment on this proposed regulatory action ends on December 31, 2012.  (PRO 04/11)
  • 10/15/12 - California Agencies Issue Alert on Mortgage Loan Modification Scams. (Consumer Alert) The Department of Corporations, in conjunction with the Department of Real Estate, has posted a Consumer Alert warning homeowners of mortgage loan modification and home refinancing scams, including a reminder that offers that try to collect fees in advance are illegal.
  • 10/12/12 - MLO  LICENSE RENEWAL REQUIREMENTS: The annual renewal period for mortgage loan originator license will be from November 1, 2012 through December 31, 2012.  MLO must renew their license during this period in order to ensure they are authorized to continue originating loans during the 2013 calendar year.  Please note that all licensed mortgage loan originators must complete 8 hours of continuing education prior to submitting a request to renew their licenses for 2013.  IF YOU COMPLETED PRE-LICENSURE EDUCATION DURING 2012, YOU ARE NOT REQUIRED TO COMPLETE 8 HOURS OF CONTINUING EDUCATION IN ORDER TO RENEW FOR 2013.  See 09/19/12 letter to All Licensed Mortgage Loan Originators.
  • 10/12/12 - COMPANY AND BRANCH LICENSE RENEWAL REQUIREMENTS FOR 2012:
     All licensees holding a California Residential Mortgage Lending Act license and licensees under the California Finance Lenders Law who make, broker or service residential mortgage loans must submit a renewal request through the Nationwide Mortgage Licensing System and Registry (NMLS) between November 1st and December 31, 2012. All licensed mortgage loan originators employed by your company must also renew their licenses during this renewal period in order to continue originating loans during 2013See 09/19/12 letter to All Companies and Branches.
  • 10/05/12 - **INTERNET ALERT – escrowsolutionsca.net** - The Department of Corporations has been notified that Escrow Solutions and escrowsolutionsca.net are offering escrow services over the internet and are falsely advertising that they are licensed and regulated by the Department of Corporations. Escrow Solutions and Escrowsolutionsca.net are not licensed to conduct escrows by the California Department of Corporations. (See Consumer Alerts)
  • 09/14/12 - **CONSUMER ALERT – VIP PDL Services, LLC, also known as The VIP Loan Shop, and www.theviploanshop.com** - The Department of Corporations has issued a Desist and Refrain Order to VIP PDL Services, LLC, also known as The VIP Loan Shop, and www.theviploanshop.com for violations of the California Deferred Deposit Transaction Law.  VIP PDL Services, LLC, The VIP Loan Shop and www.theviploanshop.com have been conducting Deferred Deposit Transactions, also commonly known as pay-day loans, over the phone and through its website, www.theviploanshop.com. VIP PDL Services, LLC, also known as The VIP Loan Shop, and www.theviploanshop.com have not been issued a license to conduct Deferred Deposit transactions within the State of California and have been ordered to desist and refrain from conducting such transactions with California residents. (See other Consumer Alerts)
  • 08/27/12 - The California Corporations Commissioner adopted amendments to Section 260.204.9 of Title 10 of the California Code of Regulations to provide a permanent exemption for certain advisers to private funds, provided they (1) have not violated securities laws, (2) file periodic reports with the Department, (3) pay the existing investment adviser registration and renewal fees, and (4) comply with additional safeguards when advising funds organized under Section 3(c)(1) and/or 3(c)(5) of the Investment Company Act of 1940.
    The exemption is based on the North American Securities Administrators Association Model Rule for Exempt Reporting Advisers, adopted December 16, 2011.
    These amendments were filed with the Secretary of State on August 27, 2012 and are effective upon filing.  (PRO 02/11)
  • 08/14/12 – California Department of Corporations Advises Caution for Payday Loan Consumers. The Department has posted an Internet Payday Lending Alert for consumers who use payday cash advances from online lenders. The Alert warns potential borrowers to take extra caution when dealing with unlicensed Internet payday lenders who fail to obtain a license with the Department of Corporations, evading state laws and regulations designed to protect consumers. The Alert provides advice and contact information to report unlicensed lenders.
  • 08/10/12 - Fairness Hearing to consider application by Facebook, Inc. to issue securities in connection with the proposed acquisition of Instagram, Inc.. Hearing will be convened Wednesday, August 29, at 10:00 am in the San Francisco Office of the Department of Corporations at One Sansome Street, 6th Floor, in the Department Hearing Room (File #: 506-3656). Interested parties may contact Mark Leyes (916-322-7180 Voice) for questions about the hearing. For a complete schedule of Fairness Hearings go to: http://www.dbo.ca.gov/ENF/FairnessHearings/Default.asp.
  • 07/26/12 - **NOTICE to Consumers** - The Department of Corporations has Issued a Desist & Refrain Order and citations to an Internet Payday Lender, A-1 Premium Budget, Inc., doing business as Cash In A Wink, and as Fast 1000. Among other allegations, the companies are alleged to have exceeded statutory limits on loan amounts and interest rates. Pursuant to section 23058, the companies have been ordered to each pay the Commissioner an administrative penalty of two-thousand five-hundred dollars ($2,500) for each of the eight citations, for a total amount of $20,000.
  • 07/17/12 - On July 16, 2012, The California Corporations Commissioner ("Comissioner") filed the final amendment to Section 260.204.9 of Title 10, of the California Code of Regulations (Certificate Exemption for Investment Advisers to Private Funds) with the Office of Administrative Law (OAL). The amendment would create a new exemptive framework for advisers to private pooled investment vehicles.

    By way of background, on July 21, 2011, the Commissioner promulgated emergency regulations to preserve a state exemption from state registration for investment advisers.  (Cal. Code Regs. tit. 10, § 260.204.9).  The emergency regulations were re-adopted on January 18, 2012 and April 17, 2012.  The notice of proposed rulemaking for the permanent regulations was published in the Notice Register on January 6, 2012.

    The emergency regulation remains in effect during OAL’s review (Gov. Code § 11346.1(e)).  The Commissioner will provide an update on its Internet website upon final promulgation of the amended rule..

    Further background on the process surrounding the adoption and extension of emergency regulations is available at:
    http://www.oal.ca.gov/emergency_regulation_process.htm

  • 06/27/12 - California Department of Corporations Advises Small Business Caution With Crowdfunding Opportunities. (Small Business Advisory) The Department has posted a Small Business Advisory concerning the trend of “Crowdfunding” as a means of capital formation for startups and small business expansion. The Advisory warns entrepreneurs to approach crowdfunding investment opportunities with great caution. Crowdfunding is an Internet-based money-raising strategy that began as a way for the public to donate small amounts of money, often through social networking websites, to help artists, musicians, filmmakers and other creative people finance their projects. The new federal Jumpstart Our Business Startups (JOBS) Act, exempts some small businesses and entrepreneurs from securities regulations in order to tap into the “crowd” in search of investments to finance their business ventures, but the practice is still regulated until the SEC issues final rules under the new law. “The potential for fraud and abuse is significant, so both entrepreneurs and investors must be extremely cautious when considering crowdfunding options,” said Jan Lynn Owen, Commissioner of the Department of Corporations.
  • 06/25/12 - **INTERNET ALERT – needcashpaydaynow.com/California Cash Advance** - The Department of Corporations has been notified that a company purporting to be California Cash Advance is offering payday loan services via unsolicited phone calls or through referral from needcashpaydaynow.com. The phone number provided to prospective customers for California Cash Advance is (209) 643-0391 with a non-existent address of 645645 W. 9th Street, Los Angeles, California. California Financial Group, LLC, doing business as California Cash Advance, a licensed finance lender and deferred deposit originator, is not associated with needcashpaydaynow.com and does not have a phone number of (209) 643-0391. (Consumer Alerts)
  • 06/18/12 - The California Corporations Commissioner is proposing further amendments to Section 260.204.9 of Chapter 3 of Title 10 of the California Code of Regulations, originally published in the June 6, 2012 California Register (No 2012, No. 1Z). This rulemaking action relates to an exemption for certain advisers to “private funds.”  The period within which to comment on these amendments ends on July 3, 2012. (PRO 02/11)
  • 06/01/12 – California Department of Corporations Announces Restitution of Millions to Defrauded Investors. The Department has successfully concluded an investment fraud case resulting in restitution to investors of $25 million.
  • 5/24/2012 - The next Escrow Law Advisory Committee meeting will be on Tuesday June 5, 2012 at 10:00 A.M. The meeting will be held at the Department of Corporations' Los Angeles office located at 320 West Fourth Street, 8th Floor Conference Room A. Agenda  The minutes of the March 14, 2012 meeting are now available.
  • 05/16/12 - California Department of Corporations Advises Investor Caution With Crowdfunding Opportunities. (Media Release) The Department has posted an Investor Alert concerning the trend of “Crowdfunding” as a means of capital formation for small businesses. The Alert warns investors to approach crowdfunding investment opportunities with great caution.  See More
  • 04/26/12 -- **INTERNET ALERT – association-market.com** - The Department of Corporations has been notified that association-market.com is offering escrow services over the internet and is falsely advertising that they are Association Escrow Services Inc. and hold Department of Corporations license number 963-2664, which is held by Association Escrow Services, Inc., a valid escrow company.  Association-market.com is not a website of Association Escrow Services, Inc.  Association-market.com is not licensed to conduct escrows by the California Department of Corporations. See other Alerts
  • 04/17/12 - The California Corporations Commissioner has readopted emergency regulations extending the effectiveness of Rule 260.204.9 of Title 10 of the California Code of Regulations for a period of 90 days.  Rule 260.204.9 currently exempts from registration investment advisers who are deemed “private advisers.”  This emergency regulatory action is effective as of April 17, 2012 and will expire on July 17, 2012.. (PRO 02/11E) 
  • 03/27/12 -The California Corporations Commissioner is providing notice that on April 4, 2012, the Department will file an emergency regulation extending the effectiveness of Rule 260.204.9 of Title 10 of the California Code of Regulations.  Rule 260.204.9 currently exempts from registration investment advisers who are deemed “private advisers.”  This emergency regulatory action will become effective on April 17, 2012, the same day as the expiration of the current emergency regulation, and will expire on July 16, 2012.  (PRO 02/11E) 
  • 3/26/2012 - Notice to Investors and Potential Claimants of Defendants Authotecq Systems, Inc., Paysentinel, LLC, Shadoworks Corp., Inc., James Anthony Litzinger, Michael R. Diaz, a.k.a. Mike Diaz, individually and doing business as Mike Diaz Enterprises and Pandy Enterprise; Wallace E. Thomas, a.k.a. Wally Thomas, individually and doing business as Wally World Entertainment; and Gregory T. Chapman.  The Commissioner of Corporations filed a civil complaint and obtained a Temporary Restraining Order, Asset Freeze and Appointment of a Receiver for the Defendants. By an order dated March 26, 2012, the Los Angeles Superior Court appointed David Pasternak, Esq., as Receiver of the defendants. This action was taken when it was learned that the defendants had committed numerous violations of the California Corporate Securities Law.  If you have any questions concerning the defendants, you may contact Mr. Pasternak at 310-553-1500.
  • 03/22/12 - **INTERNET ALERT – final-market.net** - The Department of Corporations has been notified that final-market.net and Final Escrow Professional Trade Solutions are offering escrow services over the internet and are falsely advertising that they hold Department of Corporations license number 963-2663, which is held by a valid escrow company, Final Escrow, Inc.  Final-market.net is not a website of Final Escrow, Inc.  Final-market.net and Final Escrow Professional Trade Solutions are not licensed to conduct escrows by the California Department of Corporations.
  • 03/09/12 - California Department of Corporations Warns Consumers of Top Investor Traps.
  • 03/02/12 - California Department of Corporations Participates in National Consumer Protection Week, March 4-10.
  • 03/02/12 - The next Escrow Law Advisory Committee meeting will be on Wednesday March 14, 2012 at 10:00 A.M. The meeting will be held at the Department of Corporations' Los Angeles office located at 320 West Fourth Street, 7th floor conference room. Agenda  The minutes of the December 6, 2011 meeting are now available.
  • 02/0912 - National Mortgage Settlement - The California Attorney General has reached a loan-servicing and foreclosure settlement with five major banks. If you are a homeowner struggling to pay your mortgage or facing foreclosure, or if you have already lost your home to foreclosure, it is possible that this settlement could help you. Not every homeowner will qualify for relief under this settlement. Those who do qualify may receive various forms of relief depending on their individual circumstances.
    For information about the National Mortgage Settlement, please see the California Attorney General’s press release and FAQ document. The federal government also has a National Mortgage Settlement web site with additional details.
  • 02/07/12 - The updated Mortgage Banker Annual Report and the Non-traditional Adjustable Rate and Mortgage Loan Survey are now available
  • 02/07/12 - The Department is extending the written comment deadline for the Private Fund Adviser Exemption to March 25, 2012
  • 02/03/11 - The 2011 Residential Mortgage Loan Report Form (CFL) and updated FAQs (CFL) are now available.
  • 02/03/11 - Notice to Potential Claimants of Mid-Cities Escrow. The Commissioner of Corporations Appoints a Conservator for Mid-Cities Escrow. - By an order dated February 2, 2012, the California Department of Corporations appointed Peter Davidson, Esq., as Conservator of Mid-Cities Escrow. This action was taken when it was learned that Mid-Cities Escrow  had committed numerous violations of the California Escrow Law.  If you have any questions concerning Mid-Cities Escrow, you may contact Mr. Davidson at pdavidson@ECJLAW.COM.
  • 01/31/12 - The 2011 CFL Annual Report Instructions and Forms are now available.
  • 01/23/12 - The Department has updated and reorganized its website. We hope that you find it more user-friendly as well as practical and informative. Please contact our Consumer Services Office at 866 ASK CORP or (866) 275-2677 if you need assistance locating information on our redesigned website. Website comments or suggestions can be directed to webmaster@corp.ca.gov.
  • 01/12/12 - The Commissioner of Corporations has readopted emergency regulations for the Private Fund Adviser Exemption   (PRO 02/11 Emergency Filing)