HOW THE CALIFORNIA DEPARTMENT OF FINANCIAL PROTECTION AND INNOVATION LED AN AWARD-WINNING, NATIONWIDE ENFORCEMENT EFFORT AGAINST CHEATING MORTGAGE LOAN ORIGINATORS

Written by Ryan C. Griffith

The California Department of Financial Protection and Innovation ("DFPI") is the new name for the agency tasked with protecting Californians from illegal activities in the consumer financial services sector. The DFPI was previously known as the California Department of Business Oversight ("DBO"). The name change occurred in 2020 because California Governor Gavin Newsom wanted to increase the agency’s authority and staff, as well as its regulatory scope, to become a national model for state consumer protection. The Legislature has expanded the DFPI’s jurisdiction through the California Consumer Financial Protection Law (Cal. Fin. Code, § 90000 et seq.) and now oversees additional financial products and services, such as debt collectors, debt-relief companies, credit reporting agencies, and consumer credit repair companies, among others.

The DFPI oversees numerous traditional financial products and services, including loan originators, lending brokers, and state-chartered banks, to name a few. "The DFPI is committed to securing a fair and healthy financial services marketplace for all Californians," said DFPI Commissioner Clothilde "Cloey" V. Hewlett. She further added: "We work hard every day to protect the public from fraud and deceptive business practices." In addition to enforcement, the DFPI also seeks to educate the public about financial issues.

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