Bill Text: CA SB1363 | 2009-2010 | Regular Session | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Escrow agents.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Vetoed) 2010-09-29 - In Senate. To unfinished business. (Veto) [SB1363 Detail]

Download: California-2009-SB1363-Amended.html

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BILL NUMBER: SB 1363	AMENDED
	BILL TEXT

	AMENDED IN SENATE  APRIL 12, 2010

INTRODUCED BY   Senator Runner

                        FEBRUARY 19, 2010

   An act to amend Section 17405 of, and to add Section 17405.5 to,
the Financial Code, relating to escrow agents.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 1363, as amended, Runner. Escrow agents.
   Existing law, the Escrow Law, provides for the licensure and
regulation of escrow agents by the Commissioner of Corporations.
Under that law, the commissioner is authorized to conduct an
indoctrination or preliminary examination, or both, of any new
licensee within one year of the issuance of the license, and an
inspection and examination within 2 years of the issuance of the
license.
   This bill would require the commissioner to conduct these
examinations with respect to new licensees and would also apply these
provisions to a change of ownership of a licensee. The bill would
also require  an officer, director, trustee, or employee of 
a licensee  , or the licensee's managers and shareholders
  who has access to money or negotiable securities of
the licensee, as specified  , to complete a course in escrow
management  designated   conducted  by the
commissioner, within 12 months following the issuance of a new
license or a change of ownership.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 17405 of the Financial Code is amended to read:

   17405.  (a) The business, accounts and records of every person
performing as an escrow agent, whether required to be licensed under
this division or not, are subject to inspection and examination by
the commissioner at any time without prior notice. The provisions of
this section shall not apply to persons specified in Section 17006.
   (b) Any person subject to this division shall, upon request,
exhibit and allow inspection and copying of any books and records by
the commissioner or his or her authorized representative.
   (c) (1) The commissioner shall conduct an examination of each
licensed escrow agent as described in subdivision (a) as often as the
commissioner deems necessary and appropriate, but not less than once
every 48 months.
   (2) The examination shall be conducted for the 12-month period
immediately preceding the date that the examination is commenced
unless the commissioner finds, based on information uncovered in the
examination or in the most recent independent audit report, that the
examination should be extended beyond the 12-month period.
   (3) In determining how often an examination shall be conducted,
the commissioner may consider each licensed escrow agent's compliance
with the requirements set forth in this division and other factors
the commissioner may by rule or order designate.
   (4) This subdivision shall apply only to examinations commenced
after the effective date established by the rule or order of the
commissioner for the factors described in paragraph (3).
   (d) Notwithstanding subdivision (c), the commissioner shall
conduct an indoctrination or preliminary examination, or both, under
this section of any new licensee or of a licensee that has a change
in ownership within one year of the issuance of the license or of the
change of ownership under this division, and an examination
described in subdivision (a) within two years of the issuance of the
license or of the change of ownership under this division.
  SEC. 2.  Section 17405.5 is added to the Financial Code, to read:

   17405.5.  A licensee, or the licensee's managers and shareholders,
shall, within 12 months following the issuance of a new license or a
change of ownership, complete a course in escrow management
designated by the commissioner. 
    17405.5.    (a) Any officer, director, trustee, or
employee of an escrow agent, whether or not compensated, who has
access to money or negotiable securities belonging to the escrow
agent in the regular discharge of his or her duties, or any person
who may draw checks upon the escrow agent or upon the trust funds of
the escrow agent in the regular discharge of his or her duties shall,
within 12 months of the issuance of a new license to that escrow
agent, or a change of ownership involving that escrow agent, complete
a course in escrow management conducted by the commissioner. 

   (b) The commissioner may charge persons described in subdivision
(a) a reasonable fee, as determined by the commissioner, to cover the
costs of providing courses in escrow management.