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Broker-Dealers, Investment Advisers And Others May Soon Face Enforcement Under the California Consumer Financial Protection Law
Thursday, May 1, 2025

In 2020, the legislature enacted the California Consumer Financial Protection Law. The CCFPL significantly expanded the regulatory authority of the Department of Financial Protection & Innovation by granting it the power to enforce any California or federal consumer financial law pursuant to Financial Code section § 90003(a)(2). Currently, this authority has been exercised with respect to "covered persons", as defined in Financial Code § 90005(f). These include providers of debt settlement services, income-based advances, private postsecondary education financing, and student debt relief services. 

Now, the legislature is pondering a huge expansion of the DFPI's jurisdiction by authorizing the DFPI to use its authority to enforce Financial Code § 90003 against persons and their employees licensed by the DFPI under other statutes. If SB 825 becomes law, the DFPI could take action against broker-dealers, investment advisers, finance lenders, and others for, among other things, engaging in any unlawful, unfair, deceptive, or abusive act or practice with respect to consumer financial products or services.

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