The December 2020 DFPI Bulletin focuses on new state laws for 2021, public banking regulations and LIBOR transition guidance.
The California Department of Financial Protection and Innovation (DFPI, formerly the Department of Business Oversight), 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 and Registry (NMLS) license. Alongside the California Department of Real Estate (DRE), the DFPI shares the responsibility for overseeing MLOs depending on their license use.
Licensees, keep abreast of December 2020’s MLO news and events below.
2020 legislation highlights
The DFPI includes a roundup of pertinent legislation passed in 2020 in this month’s Bulletin. The biggest focus is reserved for AB 1864, which creates a new Consumer Financial Protection Division as well as an Office of Financial Technology Innovation to better protect consumers and foster innovation through increased oversight.
Other bills notable for MLOs include AB 3088, regarding COVID-19 tenant and landlord financial protections, AB 1551, mandating disclosures under PACE-assessed properties and SB 1157, allowing tenants in lower income renters to have their rent payments reported to credit bureaus.
See the full list of DFPI highlights here.
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Law gives tenants in assisted housing more chances to improve their credit scores
LIBOR transition guidance
For a smooth discontinuation, on November 30, 2020, both the FDIC and Office of the Comptroller of the Currency (OCC) issued a statement discouraging banks from entering into contracts that use USD LIBOR as a reference rate as soon as practicable.
A separate statement was issued by the Federal Financial Institutions Examination Council (FFEIC) further reiterating this sentiment and noting banks should keep a watchful eye as they handle this transition.
2020 Escrow Annual Liability Report
Licensees can find their 2020 Escrow Annual Liability Report forms available on the DFPI website starting Jan 2, 2021. Reports are required of all escrow agents licensed prior to Jan 1, 2021 (regardless of if business was conducted) and are due electronically through the DFPI’s portal by February 15, 2021.
Licensees are required to include escrow liability figures for Escrow Agents’ Fidelity Corporation (EAFC) covered and non-covered transactions as well as information regarding surety or fidelity bonds insuring any Non-EAFC covered transactions in their reports.
Questions regarding liability report filing may be emailed to escrow.inquiries@dfpi.ca.gov.
Public Banking Law Regulations comment period
The DFPI has proposed rules meant to define new terms concerning public banking and clarify how the Commissioner processes an application for a bank charter. These proposed rules follow Governor Newsom’s recently signed AB 857 bill, which defines and clarifies new terms related to public banking allowing local agencies to apply for a certificate of authorization with the DFPI to conduct business as a bank.
The DFPI is seeking your comment regarding their proposed regulations before the public comment period deadline ends on January 21, 2021. Comments may be emailed to regulations@dfpi.ca.gov.
That’s a wrap on December’s DFPI Bulletin. You can always find out more by reading the full bulletin on the DFPI website.
