State of California

Gray Davis, Governor

Business Transportation and Housing Agency
Maria Contreras-Sweet, Secretary

Department of Financial Institutions

http://www.dfi.ca.gov


Monthly Bulletin


Volume 4, Number 3

September, 2000


Rosemarie Oda Appointed General Counsel

Commissioner Donald R. Meyer announced that Rosemarie Oda was appointed General Counsel for the Department of Financial Institutions effective Monday, September 18, 2000.

Prior to her appointment, Ms. Oda served as District Counsel for the San Francisco Office of the Comptroller of the Currency (OCC) in charge of all of the attorneys in the Western District and with the OCC in Washington, D.C. She has also worked for the Los Angeles County Public Defender's Office, the House Judiciary Committee and the Federal Trade Commission. Before entering law school, Ms. Oda served with the Peace Corps in Iran.

Ms. Oda has a B.A. from the University of California at Berkeley and a J.D. from the University of California at Los Angeles School of Law. She has also obtained a Certificate in Banking from the Pacific Coast Banking School at the University of Washington in Seattle. Ms. Oda can be contacted at (415) 263-8517 or by email at roda@dfi.ca.gov.

Governor Signs Department-Sponsored legislation

On September 23, 2000 Governor Davis approved SB 1472. On September 24, 2000 the bill was chaptered by the Secretary of State as Chapter 612, Statutes of 2000. This Department of Financial Institutions sponsored legislation will amend the Credit Union Law to provide a framework for a foreign (other state) state credit union to conduct a credit union business in California. Existing law does not permit a credit union organized under the laws of a foreign country to do business in California. The legislation also authorizes a credit union organized under the laws of another country or foreign jurisdiction to operate as a credit union in California, within an established regulatory framework. This legislation complies with the Legislature’s mandate, as established in Chapter 385, Statutes of 1999, for the Commissioner to provide recommendations to implement the Legislature's intent to authorize foreign (other nation) credit unions to do business in California.

September 29, 2000 Governor Davis approved SB 2148. On September 30, 2000 the bill was chaptered by the Secretary of State as Chapter 1015, Statutes of 2000. This Department of Financial Institutions sponsored legislation recasts the regulation of industrial loan companies ("industrial banks") by regulating these licensees under Division 1 of the Financial Code instead of Division 7, which currently regulates industrial loan companies and insurance premium finance companies. The legislation removes much of the detailed regulation over business judgments of industrial loan companies, while at the same time subjecting them to an overall regulatory framework of "safety and soundness" thereby increasing the role of the Department as the specificity in the law is decreased. The legislation will also enable industrial loan companies to offer consumers more lending products since the restrictions on terms and conditions currently found in the Industrial Loan Law will no longer be applicable.

Escheat Amnesty Bill Passes

Assembly Bill 1888, sponsored by the State Controller’s Office, was signed by Governor Davis. The new law would allow holders of unclaimed property who are delinquent in their duty to pay or deliver unclaimed property to surrender the property without incurring interest assessments. Delinquent holders will have only until the end of this year to deliver unpaid property that was reportable on or before November 1, 1999. For more details on how to surrender unclaimed property under the terms of Assembly Bill 1888, please contact the State Controller’s Office, Unclaimed Property Division at (800) 992-4647 or use the forms available online at www.sco.ca.gov.

Advisory Notice

We have received notice that fraudulent business proposals originating from Nigeria are once again being perpetrated on Californians via email. In past years, we have issued various notices regarding similar fraudulent schemes being perpetrated by email, postal mail or fax. The proposals attempt to dupe contacted businesses to pay up front fees in order to participate in schemes to share in enormous financial gain. We reiterate our earlier advisories that extreme caution be used in dealing with any person or persons offering these dubious "business opportunities".

Features of a typical scheme are as follows:

Contact from someone claiming to be a functionary in a Nigerian government-run corporation, for example, the Nigerian National Petroleum Company. The communication claims that the Nigerian agency has a large sum of money available in connection with an unfulfilled contract with one of the many former military and civilian governments that have been in power in recent years in Nigeria. The purported money usually amounts to millions of dollars.

The communication proposes a way that the large sum of "money" can be used for personal gain, but in order to effect the scheme, it is necessary that sham documents be produced which make it appear that the "money" has been spent for legitimate goods and services.

The communication proposes that the contacted business (the "target") supply the necessary sham documents, such as blank invoices, company stationery, and the name and numbers of its bank accounts. In return for this information, the communication proposes to give the target a share of the "money", usually 30 percent. Once the target indicates a willingness to participate in the scheme, a later communication asks the target to send a fee or "commission" to cover the expense of transferring the "money" to the target’s bank account.

The proposals attempt to dupe businesses into paying up front fees in order to participate in schemes to share in enormous financial gain. After paying the fee, the target is, of course, unsuccessful in acquiring its share of the money and is understandably reluctant to report the matter to law enforcement authorities. The Department is aware of a California business that paid a "fee" of $515,000 after participating in one such scheme. In that case, the scheme involved several trips to Nigeria where the principal of the California business was received by "officials" in a sham Nigerian government office.

The Embassy of Nigeria has advised the general public and members of the business community in particular to be mindful should they receive "business" proposals from Nigeria along the lines described. U.S. corporations or businesspersons should ensure that the parties being dealt with are bona fide companies. Inquiries can be made to either the Nigerian Embassy or Consulate General in Washington, D.C. or New York, respectively, for advice. In addition, business transactions should be conducted on the basis of confirmed letters of credit.

The Embassy of Nigeria is located at 1333 16th Street, N.W., Washington, D.C. 20036; telephone: (202) 986-8400; facsimile: (202) 775-1385. The Consulate General of Nigeria is located at 828 Second Avenue, New York, NY 10017; telephone: (212) 850-2200; facsimile: (212) 212-687-1476.

Monthly Activity Report

Commercial Bank Activity

New Banks

BBOC INTERIM BANK
Proposed Location: 505 West Second Street, City and County of San Bernardino
Opened: 8/31/00
Correspondent: Madge S. Beletsky, Esq.
Fried, Bird & Crumpacker
1900 Avenue of the Stars, 25th Floor
Los Angeles, CA 90067
Phone: (310) 282-8911
(Application filed in connection with the merger of Valley Merchants Bank, N.A., Hemet, with and into Business Bank of California, San Bernardino)

HORIZON BANK
Proposed Location: Ventura and Balboa Boulevards, Encino, Los Angeles County
Withdrawn: 9/12/00
Correspondent: S. Alan Rosen, Esq.
Horgan Rosen Beckham & Coren, LLP
21700 Oxnard Street, Suite 1400
Woodland Hills, CA 91365
Phone: (818) 340-6100

PROFESSIONAL BUSINESS BANK
Proposed Location: 199 North Robles Avenue, City of Pasadena, Los Angeles County
Withdrawn: 8/29/00
Correspondent: Howard A. Shields
116 North Maryland #120, Glendale, CA 91206
Phone: (818) 546-8700

Mergers

BBOC Interim Bank, San Bernardino, with and into Valley Merchants Bank, N.A., Hemet
Effected: 8/31/00

Bank of Ventura, Ventura, with and into First Bank & Trust, Newport Beach
Filed: 8/31/00
Approved: 8/31/00
Effected: 8/31/00

Commercial Bank of San Francisco, San Francisco, with and into Redwood Bank, San Francisco
Filed: 8/30/00

First Counties Bank, Clearlake, with and into Westamerica Bank, San Rafael
Effected: 9/16/00

Millennium Bank, San Francisco, with and into Redwood Bank, San Francisco
Filed: 9/15/00

Valley Merchants Bank, N.A., Hemet, with and into Business Bank of California, San Bernardino
Filed: 6/5/00
Approved: 6/13/00
Effected: 8/31/00

Application for Trust Powers

MID-STATE BANK
1026 Grand Avenue, Arroyo Grande, San Luis Obispo County
Approved: 9/13//00

Sale of Partial Business Units

Dai-Ichi Kangyo Bank of California, Los Angeles, to sell substantially all of its corporate trust business to BNY Western Trust Company, Los Angeles
Filed: 9/6/00
Approved: 9/11/00
Effected: 9/25/00

Humboldt Bank, Eureka, California, to sell certain deposits to First National Bank in Brookings, Brookings, South Dakota
Effected: 7/31/00

Pacific State Bank, Stockton, to sell its Columbia Branch to Western Sierra National Bank, Cameron Park
Filed: 8/23/00
Approved: 9/21/00

Foreign Bank Activity

Foreign (Other Nation) Bank – To Establish Office

GRAND COMMERCIAL BANK, Taipei, Taiwan, R.O.C.
In the vicinity of Colima and Azusa Avenues, City of Industry, Los Angeles County
(Wholesale Branch)
Filed: 8/30/00

Foreign (Other State) Bank – To Discontinue Office

Bankers Trust (Delaware)
300 South Grand Avenue, Los Angeles
(Facility – Insured Bank)
Discontinued: 10/1/00

Industrial Loan Company Activity

New Industrial Loan Company

NOVA FINANCIAL, INC.
2100 East Katella Avenue, Suite 220, Anaheim, CA 92806
(Premium Finance Agency)
Filed: 4/14/00
Approved: 8/28/00

Credit Union Activity

Conversions to State Charter

Alliance Federal Credit Union to convert to state charter under the name Alliance Credit Union
Effected: 7/1/00

Capitol Power Federal Credit Union, Sacramento
Filed: 6/1/99

Ebtel Federal Credit Union, Pleasanton
Filed: 7/24/00

First Federal Credit Union, Sacramento
Filed: 11/8/99

Star One Federal Credit Union, Sunnyvale
Filed: 8/2/00

Steinbeck Federal Credit Union, Salinas
Filed: 9/13/00

Merger

Spreckels District #4 Credit Union, Mendota, with and into UFCW Local 1288 Credit Union, Fresno
Effected: 9/5/00

Transmitter of Money Abroad Activity

New Transmitter

Cong Ty Chuyen Tien Viet Nam, Inc.
718 Blueridge Drive, Santa Maria, CA 93455
Opened: 8/18/00
Contact Person: Mr. Muoi Huynh
Phone: (805) 928-7364

 

 

DONALD R. MEYER
Commissioner of Financial Institutions

 

Bulletin for month ended
September, 2000, issued pursuant
to Financial Code, Section 258

 

The Monthly Bulletin is available without charge via email as a PDF attachment. To subscribe, please contact Mary Ann Havens at mhavens@dfi.ca.gov.