The California Department of Business Oversight (DBO) supervises, licenses and regulates a variety of financial institutions, including some real estate mortgage loan originators (MLOs) holding a Nationwide Multistate (or Mortgage) Licensing System & Registry (NMLS) license. Alongside the California Department of Real Estate (DRE), the DBO shares the responsibility of overseeing MLOs depending on their license use.

The DBO publishes a monthly bulletin updating the public on the latest DBO news. Here’s a rundown of May’s most important DBO happenings.

California welcomes a new Commissioner

Governor Gavin Newsom appointed Manuel P. Alvarez the new DBO Commissioner on March 28, 2019. He was sworn in on May 13. Alvarez previously served as Chief Compliance Officer for San Francisco tech startup Affirm, Inc.

Don’t let the tech startup fool you—Alvarez is a seasoned civil servant. He was one of the original members of the Consumer Financial Protection Bureau (CFPB) and the lead attorney in CFPB v. Castle & Cooke Mortgage LLC, et al., the first enforcement action of the Mortgage Loan Originator Compensation Rule after the 2008 foreclosure crisis.

The DBO Commissioner position requires California Senate confirmation, but Alvarez’s appointment is expected to be approved. He succeeds Commissioner Jan Lynn Owen, who served the DBO since its creation in 2013.

2019 National Survey of Community Banks

The Conference of State Bank Supervisors (CSBS) is a nationwide organization of financial regulators from all 50 states that supports state regulators in advancing regulation and supervision of state banking and financial services. It sponsors the annual Community Banking in the 21st Century Research and Policy Conference.

At last year’s conference, the CSBS announced plans to create an ongoing sentiment index of community bankers. This is implemented in the form of ten short questions at the end of the 2019 National Survey of Community Banks.

The entire survey takes about 20 minutes and asks about financial institutions’ products and services, regulatory satisfaction and economic outlook. Responses are requested by June 30. You can take the survey here. Findings will be published at the seventh annual Community Banking in the 21st Century Research and Policy Conference. You can also download last year’s results here.

Vision 2020 report

The CSBS is also focusing on regulating nonbank financial services companies through their Vision 2020 program. Currently, states are the primary regulators for nonbank mortgage lenders, money transmitters, debt collectors and consumer finance companies. Vision 2020 is a series of initiatives aiming to create an integrated, 50-state licensing and supervisory system by the year 2020.

Vision 2020 plants to create this system by:

  • redesigning the NMLS;
  • developing a common technology platform for state exams;
  • forming a fintech industry advisory panel to modernize regulation schemes;
  • creating education programs to help state banking departments;
  • encouraging banks to do business with nonbanks by creating strong regulations; and
  • supporting federal legislation that would allow for closer coordination between regulators and third-party fintech service providers.

Read the CSBS Vision 2020 announcement here.

Small businesses

Governor Gavin Newsom declared May 2019 as Small Business Month in California. Boasting the fifth-largest economy in the world, the state is home to more than 3.9 million small businesses. In his proclamation, Governor Newsom emphasizes the role of diversity, acknowledging that over 40% of these small businesses are minority-owned and are an indispensable part of the economy.

Read the full proclamation here.

Unclaimed Property

The State Controller’s Office has published the Unclaimed Property Division 2019 Spring Newsletter for Holders, which includes information for DBO licensees that hold unclaimed property. Learn more about:

  • holder remit reports;
  • 2019 holder due diligence;
  • escheatable individual retirement accounts (IRAs);
  • unclaimed property webinars; and
  • exchange-traded fund (ETF) guidelines

by downloading the newsletter here.

The State Controller’s Office also publishes a fact sheet on remitting unclaimed property to the state. Find out how to remit cash, securities and safekeep property here.

Read the full May 2019 DBO Bulletin.