The August 2022 DFPI Bulletin focuses on a crypto-active consumer survey and alert, and AARP Fraudulent chat, among other topics.

Editor’s Note – California Financial Protection and Innovation Department (DFPIformerly the Business Supervision Department) oversees, licenses and regulates a variety of financial institutions, including certain home mortgage originators (MLOs) holding a National Multi-State (or Mortgage) Licensing System and Registry (NMLS) Licence. Alongside California Real Estate Department (DRE)the DFPI shares responsibility for monitoring MLOs based on their use of licenses.

Licensees, keep up to date with MLO news and events for August 2022 below.

Crypto Asset Products and Services Survey

As crypto assets have ballooned (and deflated) during the pandemic, regulation and oversight are more important than ever. The DFPI sent a voluntary survey on July 28, 2022 to all DFPI-licensed banks, credit unions and trust companies regarding blockchain technologies and financial products and services related to crypto assets.

The survey asked licensees how they use blockchain technology and financial products and services related to crypto assets, as well as any initiatives being considered. The survey also asked licensees to flag areas that should be addressed in the guidance the DFPI intends to issue by March 31, 2023according to Governor Gavin Newsom Executive Decree relating to cryptographic assets and blockchain technologies.

The response time for licensees is August 26, 2022. It was emailed to each institution’s designated email address and contains a personalized secure link.

For questions about the contents of the investigation, contact Adam Wright, senior counsel for the DFPI’s Office of Financial Technology Innovation (OFTI), at [email protected].

Consumer Alert on Crypto Interest Accounts

The DFPI also investigates companies offering interest-bearing crypto asset accounts. An interest-bearing crypto interest account allows clients to lend crypto assets and receive in exchange interest paid on crypto assets.

As Bitcoin (BTC) Briefly dipped below $20,000 in June 2022, panicked crypto exchanges froze withdrawals to stop the bleeding. The DFPI published a Consumer Alert to warn California consumers and investors that many crypto interest account providers may not have properly disclosed the risks clients face when depositing crypto assets on these exchanges and platforms.

The DFPI encourages consumers to exercise extreme caution before responding to any solicitation offering investments or financial services. California customers of Crypto Interest Account providers who have slowed or suspended withdrawals or transfers of crypto assets are encouraged to contact the DFPI at [email protected] or (866) 275-2677.

To file a formal complaint, visit DFPI File a Complaint Web Page.

Call for comments

On July 15, 2022, the Commissioner invited comments on the draft text relating to the scope, the annual report and the document retention provisions of the Debt Collections Licensing Act.

This draft text initially contained an error in proposed section 1850.2(a). The revised draft text clarifies that neither residential rental debt nor debt owed to a homeowners association is consumer debt under the Debt Collections Licensing Act.

The corrected draft is hosted on the DFPI website. The deadline for submitting comments is Monday, August 29, 2022.

Scam Chat Wednesdays

AARP California is partnering with the DFPI to better educate consumers on the latest scams and frauds by hosting a new series of weekly webinars: Scam Chat Wednesdays. These webinars cover a variety of topics, including hype scams, home improvement and solar energy scams, investment fraud schemes, and financial empowerment.

To sign up for Scam Chat Wednesdays, visit:

2021 Annual Reports on Mortgages and Payday Loans

Since July, the DFPI has made available annual reports for the California Residential Mortgage Act (CRMLA) and the California Deferred Deposit Transactions Act (CDDTL) – also known as a payday loan.

Both sets of annual reports are published in July of each year and can be viewed below:

That’s the end of the August 2022 DFPI Bulletin. For more on the topics mentioned here, read the full bulletin on the DFPI website.