To Mini-CFPB or Not To Mini-CFPB? That’s the Question for California

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Recently, joined by former CFPB Director Richard Cordray, California Assemblywoman Monique Limon (D-Santa Barbara) told a press gathering that she planned to introduce legislation to create a state-level version of the federal Consumer Financial Protection Bureau (CFPB), either by raising the budget of the state’s Department of Business Oversight (DBO) or through the creation of a new state agency. “We are working to really rethink what a state CFPB would do,” Limon said. “We see the presence of predatory lending products in auto loans, payday loans, cash advance and small business loans.” However, given the March announcement by Gov. Gavin Newsom of the appointment of Affirm’s General Counsel and Chief Compliance Officer, Manuel “Manny” Alvarez, to take over for current DBO Commissioner Jan Lynn Owen, a mini-CFPB for California may not be in the cards. Rather, the BDO’s supervisory and enforcement activities may just be expanded with an increased budget and staff. Alvarez is no stranger to government work or consumer financial protection, as he was one of the original members of the CFPB. And, Alvarez previously worked in the Consumer Law Section of the California Attorney General’s office. If confirmed by the state Senate (and there is no reason to believe he won’t be), Alvarez will become only the second commissioner in the history of the DBO, which was created in 2014 by a merger of the Departments of Corporations and Financial Institutions.

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