Bill Text: CA SB559 | 2017-2018 | Regular Session | Chaptered
Bill Title: Private Investigator Act: license: limited liability company.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Passed) 2017-10-07 - Chaptered by Secretary of State. Chapter 569, Statutes of 2017. [SB559 Detail]
Download: California-2017-SB559-Chaptered.html
| Senate Bill No. 559 |
| CHAPTER 569 |
An act to amend Sections 7512.3, 7512.7, 7515, 7518, 7520.3, 7521, 7521.5, 7525.1, 7526, 7527, 7527.5, 7529, 7530, 7531, 7533.5, 7536, 7537, 7538, 7538.5, 7539, 7541, 7541.1, 7561.1, 7561.3, 7561.4, and 7570 of, to add Section 7533.2 to, and to add and repeal Sections 7512.14 and 7512.15 of, the Business and Professions Code, relating to professions and vocations.
[
Approved by
Governor
October 07, 2017.
Filed with
Secretary of State
October 07, 2017.
]
LEGISLATIVE COUNSEL'S DIGEST
SB 559, Morrell.
Private Investigator Act: license: limited liability company.
Existing law, the Private Investigator Act, provides for the licensure and regulation of private investigators by the Bureau of Security and Investigative Services.
(1) Existing law, until January 1, 2018, authorizes the bureau to issue a private investigator license to a limited liability company.
Existing law, the California Revised Uniform Limited Liability Company Act, authorizes a limited liability company to have any lawful purpose, except as specified, and authorizes a domestic or foreign limited liability company to render services that may be lawfully rendered only pursuant to a license, certificate, or registration authorized by the Business and Professions Code if the provisions of that code authorize a limited liability company or foreign limited liability company to
hold that license, certificate, or registration. As a condition for licensure, existing law requires a limited liability company to maintain a policy or policies of insurance against liability imposed on or against it by law for damages arising out of claims based upon acts, errors, or omissions arising out of the private investigator services it provides. Under existing law, if the applicant for a license is a limited liability company, the application is required to include specified information pertaining to each managing member and any other officer or member who will be active in the licensed business.
This bill, until January 1, 2021, would extend the authority for the bureau to issue a private investigator license to a limited liability company and make related conforming changes. The bill also would define terms. The bill, on and after July 1, 2018, and until January 1, 2021, would require a licensee organized as a limited liability company to report a paid
or pending claim against its liability insurance to the bureau and would require the bureau to post a notice of the claim on a specified license verification Internet Web page. The bill, beginning July 1, 2018, would require an applicant for an initial license or a licensee applying for reassignment of the license to notify the bureau on the application for licensure or reassignment if the applicant or licensee is a limited liability company and would require the bureau to include this information on a specified license verification Internet Web page.
(2) Existing law requires an applicant, or his or her manager, for a license as a private investigator to have had at least 3 years’ experience in investigation work. Under existing law, a year’s experience is required to consist of not less than 2,000 hours of actual compensated work performed by each applicant preceding the filing of an application. Under existing law, an applicant who holds a law degree or who has completed a four-year course in police science, criminal justice, criminal law, or the equivalent is required to have had 2 years’ experience in investigation work.
This bill would revise and recast these provisions by requiring an applicant with a law degree or bachelor’s degree in police science, criminal justice, criminal law, or the equivalent to be credited with 2,000 hours of experience in investigation work. The bill would require an applicant with an associate degree in police
science, criminal justice, criminal law, or the equivalent to be credited with 1,000 hours of experience in investigation work. The bill would prohibit the total amount of time credited to an applicant for these degrees from exceeding 2,000 hours of experience in investigation work.
(3) This bill would make various other conforming changes.
Digest Key
Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: NOBill Text
The people of the State of California do enact as follows:
SECTION 1.
Section 7512.3 of the Business and Professions Code, as amended by Section 1 of Chapter 669 of the Statutes of 2014, is amended to read:7512.3.
(a) As used in this chapter, “person” includes any individual, firm, company, limited liability company, association, organization, partnership, and corporation.(b) This section shall remain in effect only until January 1, 2021, and as of that date is repealed.
SEC. 2.
Section 7512.3 of the Business and Professions Code, as added by Section 2 of Chapter 669 of the Statutes of 2014, is amended to read:7512.3.
(a) As used in this chapter, “person” includes any individual, firm, company, association, organization, partnership, and corporation.(b) This section shall become operative on January 1, 2021.
SEC. 3.
Section 7512.7 of the Business and Professions Code is amended to read:7512.7.
As used in this chapter, “qualified manager” means the individual under whose direction, control, charge, or management the business of a licensee is operated as specified in Section 7536.SEC. 4.
Section 7512.14 is added to the Business and Professions Code, to read:7512.14.
(a) As used in this chapter, “member” means an individual who is a member of a limited liability company as specified in Section 17704.01 of the Corporations Code.(b) This section shall remain in effect only until January 1, 2021, and as of that date is repealed.
SEC. 5.
Section 7512.15 is added to the Business and Professions Code, to read:7512.15.
(a) As used in this chapter, “manager” means an individual designated under an operating agreement of a manager-managed limited liability company who is responsible for performing the management functions for the limited liability company specified in subdivision (c) of Section 17704.07 of the Corporations Code.(b) This section shall remain in effect only until January 1, 2021, and as of that date is repealed.
SEC. 6.
Section 7515 of the Business and Professions Code is amended to read:7515.
The director may adopt and enforce reasonable rules, as follows:(a) Fixing the qualifications of licensees and qualified managers, in addition to those prescribed in this chapter, necessary to promote and protect the public welfare.
(b) Carrying out generally the provisions of this chapter, including regulation of the conduct of licensees.
SEC. 7.
Section 7518 of the Business and Professions Code is amended to read:7518.
Where a hearing is held under this chapter to determine whether an application for a license should be granted or to determine the qualifications of a licensee’s qualified manager, the proceedings shall be conducted in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code, and the director shall have all of the powers granted therein.SEC. 8.
Section 7520.3 of the Business and Professions Code is amended to read:7520.3.
(a) As a condition of the issuance, reinstatement, reactivation, or continued valid use of a license under this chapter, a limited liability company shall, in accordance with this section, maintain a policy or policies of insurance against liability imposed on or against it by law for damages arising out of claims based upon acts, errors, or omissions arising out of the private investigator services it provides.(b) The total aggregate limit of liability under the policy or policies of insurance required under this section shall be as follows:
(1) For a limited liability company licensee with five or fewer persons named as
members pursuant to subdivision (i) of Section 7525.1, the aggregate limit shall not be less than one million dollars ($1,000,000).
(2) For a limited liability company licensee with more than five persons named as members pursuant to subdivision (i) of Section 7525.1, an additional one hundred thousand dollars ($100,000) of insurance shall be obtained for each person named as members of the licensee except that the maximum amount of insurance is not required to exceed five million dollars ($5,000,000) in any one designated period, less amounts paid in defending, settling, or discharging claims as set forth under this section.
(c) Prior to the issuance, reinstatement, or reactivation of a limited liability company license as provided under this chapter, the applicant or licensee
shall, in the manner prescribed by the bureau, submit the information and documentation required by this section and requested by the bureau, demonstrating compliance with the financial security requirements specified by this section.
(d) For any insurance policy secured by a licensee in satisfaction of this section, a Certificate of Liability Insurance, signed by an authorized agent or employee of the insurer, shall be submitted electronically or otherwise to the bureau. The insurer issuing the certificate shall report to the bureau the following information for any policy required under this section: name, license number, policy number, dates that coverage is scheduled to commence and lapse, and cancellation date if applicable. The insurer shall list the bureau as the certificate holder for the purposes of receiving notifications related to
the policy’s status.
(e) (1) If a licensee fails to maintain sufficient insurance as required by this section, or fails to provide proof of the required insurance upon request by the bureau, the license is subject to suspension and shall be automatically suspended pursuant to this subdivision until the date that the licensee provides proof to the bureau of compliance with the insurance coverage requirement.
(2) Prior to an automatic suspension, the bureau shall notify the licensee, in writing, that it has 30 days to provide proof to the bureau of having the required insurance or the license shall be automatically suspended.
(3) If the licensee fails to provide proof of insurance coverage within this
period, the bureau may automatically suspend the license.
(f) If the license of a limited liability company is suspended pursuant to subdivision (e), each member of the limited liability company shall be personally liable up to one million dollars ($1,000,000) each for damages resulting to third parties in connection with the company’s performance, during the period of suspension, of any act or contract when a license is required by this chapter.
(g) On and after July 1, 2018, a licensee organized as a limited liability company shall report a paid or pending claim against its liability insurance to the bureau, which shall post a notice of the claim on the Department of Consumer Affairs BreEZe License Verification Internet Web page.
(h) This section shall remain in effect only until January 1, 2021, and as of that date is repealed.
SEC. 9.
Section 7521 of the Business and Professions Code is amended to read:7521.
A private investigator within the meaning of this chapter is a person, other than an insurance adjuster subject to the provisions of Chapter 1 (commencing with Section 14000) of Division 5 of the Insurance Code, who, for any consideration whatsoever engages in business or accepts employment to furnish or agrees to furnish any person to protect persons pursuant to Section 7521.5, or engages in business or accepts employment to furnish, or agrees to make, or makes, any investigation for the purpose of obtaining, information with reference to:(a) Crime or wrongs done or threatened against the United States of America or any state or territory of the United States of
America.
(b) The identity, habits, conduct, business, occupation, honesty, integrity, credibility, knowledge, trustworthiness, efficiency, loyalty, activity, movement, whereabouts, affiliations, associations, transactions, acts, reputation, or character of any person.
(c) The location, disposition, or recovery of lost or stolen property.
(d) The cause or responsibility for fires, libels, losses, accidents, or damage or injury to persons or to property.
(e) Securing evidence to be used before any court, board, officer, or investigating committee.
For the purposes of this section, a private investigator is any person,
as defined in Section 7512.3, acting for the purpose of investigating, obtaining, and reporting to any employer, or an agent designated by the employer, information concerning the employer’s employees involving questions of integrity, honesty, breach of rules, or other standards of performance of job duties.
This section shall not apply to a public utility regulated by the State Public Utilities Commission, or its employees.
SEC. 10.
Section 7521.5 of the Business and Professions Code is amended to read:7521.5.
(a) A private investigator may provide services to protect a person, but not property, which is incidental to an investigation for which the private investigator has been previously hired to perform.(b) If the private investigator provides those services, he or she shall comply with the requirements of Article 4 (commencing with Section 7540), as those provisions relate to the carrying of firearms and the receipt of a valid firearms qualification card from the bureau.
(c) If the private investigator provides those services, he or she shall comply with the requirements of Sections
7583.39, 7583.40, and 7583.41, as those provisions relate to the maintenance of an insurance policy.
(d) If a person acts for, or on behalf of a private investigator in providing those services, that person shall be an employee of the private investigator, as defined by Section 7512.11, and there shall be an employer-employee relationship, as defined in Section 7512.12, and that person shall comply with the requirements of this section, except as provided in subdivisions (b) and (c).
SEC. 11.
Section 7525.1 of the Business and Professions Code, as amended by Section 11 of Chapter 800 of the Statutes of 2016, is amended to read:7525.1.
An application shall be verified and shall include:(a) The full name and business address of the applicant.
(b) The name under which the applicant intends to do business.
(c) A statement as to the general nature of the business in which the applicant intends to engage.
(d) A verified statement of his or her experience qualifications.
(e) (1) If the applicant is an individual, a qualified manager, a partner of a partnership, an officer of a corporation
designated in subdivision (h), or a member, officer, or manager of a limited liability company designated in subdivision (i), one personal identification form provided by the bureau upon which shall appear a photograph taken within one year immediately preceding the date of the filing of the application together with two legible sets of fingerprints, one set of which shall be forwarded to the Federal Bureau of Investigation for purposes of a background check, on a form approved by the Department of Justice, and a personal description of each person, respectively. The identification form shall include residence addresses and employment history for the previous five years and be signed under penalty of perjury.
(2) The bureau may impose a fee not to exceed three dollars ($3) for processing classifiable fingerprint cards submitted by applicants,
excluding those submitted into an electronic fingerprint system using electronic fingerprint technology.
(f) In addition, if the applicant for a license is an individual, the application shall list all other names known as or used during the past 10 years and shall state that the applicant is to be personally and actively in charge of the business for which the license is sought. If any other qualified manager is to be actively in charge of the business, the application shall be subscribed, verified, and signed by the applicant, under penalty of perjury. If any other person is to be actively in charge of the business, the application shall also be subscribed, verified, and signed by that person under penalty of perjury.
(g) If the applicants for a license are copartners, the application
shall state the true names and addresses of all partners and the name of the partner to be actively in charge of the business for which the license is sought and list all other names known as or used during the past 10 years. If a qualified manager other than a partner is to be actively in charge of the business, then the application shall be subscribed, verified, and signed by all of the partners under penalty of perjury. If any other person is to be actively in charge of the business, the application shall also be subscribed, verified, and signed by that person, under penalty of perjury, under penalty of perjury by all of the partners and the qualified manager, or by all of the partners or the qualified manager.
(h) If the applicant for a license is a corporation, the application shall state the true names and complete residence
addresses of the chief executive officer, secretary, chief financial officer, and any other corporate officer who will be active in the business to be licensed. The application shall also state the name and address of the designated person to be actively in charge of the business for which the license is sought. The application shall be subscribed, verified, and signed by a duly authorized officer of the applicant and by the qualified manager thereof, under penalty of perjury.
(i) If the applicant for a license is a limited liability company, the application shall state the true name and complete residence address of each member, manager, and any officer who will be active in the business to be licensed. A certified copy of the articles of organization, as filed by the Secretary of State, shall be supplied to the bureau upon request. In the
case of a manager-managed limited liability company, the application shall be subscribed, verified, and signed by a manager; otherwise, in the case of a member-managed limited liability company, the application shall be subscribed, verified, and signed by a duly authorized member of the applicant and by the qualified manager thereof. The application shall also state whether any of the members, managers, officers, or the qualified manager has ever used an alias.
(j) Any other information, evidence, statements, or documents as may be required by the director.
(k) At the discretion of the applicant, a valid email address.
(l) This section shall remain in effect only until January 1, 2021, and as of that date is
repealed.
SEC. 12.
Section 7525.1 of the Business and Professions Code, as amended by Section 6 of Chapter 635 of the Statutes of 2015, is amended to read:7525.1.
An application shall be verified and shall include:(a) The full name and business address of the applicant.
(b) The name under which the applicant intends to do business.
(c) A statement as to the general nature of the business in which the applicant intends to engage.
(d) A verified statement of his or her experience qualifications.
(e) (1) If the applicant is an individual, a qualified manager, a partner of a partnership, or an officer of a corporation
designated in subdivision (h), one personal identification form provided by the bureau upon which shall appear a photograph taken within one year immediately preceding the date of the filing of the application together with two legible sets of fingerprints, one set of which shall be forwarded to the Federal Bureau of Investigation for purposes of a background check, on a form approved by the Department of Justice, and a personal description of each person, respectively. The identification form shall include residence addresses and employment history for the previous five years and be signed under penalty of perjury.
(2) The bureau may impose a fee not to exceed three dollars ($3) for processing classifiable fingerprint cards submitted by applicants, excluding those submitted into an electronic fingerprint system using electronic
fingerprint technology.
(f) In addition, if the applicant for a license is an individual, the
application shall list all other names known as or used during the past 10 years and shall state that the applicant is to be personally and actively in charge of the business for which the license is sought. If any other qualified manager is to be actively in charge of the business, the application shall be subscribed, verified, and signed by the applicant, under penalty of perjury. If any other person is to be actively in charge of the business, the application shall also be subscribed, verified, and signed by that person under penalty of perjury.
(g) If the applicants for a license are copartners, the application shall state the true names and addresses of all partners and the name of the partner to be actively in charge of the business for which the license is sought and list all other names known as or used during the
past 10 years. If a qualified manager other than a partner is to be actively in charge of the business, then the application shall be subscribed, verified, and signed by all of the partners under penalty of perjury. If any other person is to be actively in charge of the business, the application shall also be subscribed, verified, and signed under penalty of perjury by that person, by all of the partners and the qualified manager, or by all of the partners or the qualified manager.
(h) If the applicant for a license is a corporation, the application shall state the true names and complete residence addresses of the chief executive officer, secretary, chief financial officer, and any other corporate officer who will be active in the business to be licensed. The application shall also state the name and address of the designated person to be
actively in charge of the business for which the license is sought. The application shall be subscribed, verified, and signed by a duly authorized officer of the applicant and by the qualified manager thereof, under penalty of perjury.
(i) Any other information, evidence, statements, or documents as may be required by the director.
(j) At the discretion of the applicant, a valid email address.
(k) This section shall become operative on January 1, 2021.
SEC. 13.
Section 7526 of the Business and Professions Code is amended to read:7526.
Before an application for a license is granted, the applicant for a license or his or her qualified manager shall meet all of the following:(a) Be at least 18 years of age.
(b) Not have committed acts or crimes constituting grounds for denial of a license under Section 480.
(c) Comply with the requirements specified in this chapter for the particular license for which an application is made.
(d) Comply with other qualifications as the director may fix by rule.
SEC. 14.
Section 7527 of the Business and Professions Code is amended to read:7527.
The director may require an applicant or his or her qualified manager, to demonstrate his or her qualifications by a written or oral examination, or a combination of both.SEC. 15.
Section 7527.5 of the Business and Professions Code is amended to read:7527.5.
Payment of the application fee prescribed by this chapter entitles an applicant or his or her qualified manager to one examination without further charge. If the person fails to pass the examination, he or she shall not be eligible for any subsequent examination except upon payment of the reexamination fee prescribed by this chapter for each subsequent examination.SEC. 16.
Section 7529 of the Business and Professions Code, as amended by Section 6 of Chapter 669 of the Statutes of 2014, is amended to read:7529.
(a) Upon the issuance of a license, a pocket card of the size, design, and content as may be determined by the director shall be issued by the bureau to each licensee, as follows:(1) If the licensee is an individual, the pocket card shall be issued to the licensee and the licensee’s qualified manager.
(2) If the licensee is a partnership, the pocket card shall be issued to each partner of the partnership licensee active in the business and the licensee’s qualified manager.
(3) If the licensee is a corporation, the pocket card shall be issued to each officer active
in the business and the licensee’s qualified manager.
(4) If the licensee is a limited liability company, the pocket card shall be issued to each member, officer, and manager of the licensee active in the business and the licensee’s qualified manager.
(b) The pocket card is evidence that the licensee is licensed pursuant to this chapter. The card shall contain the signature of the licensee, signature of the chief, and a photograph of the licensee, or bearer of the card, if the licensee is other than an individual. The card shall clearly state that the person is licensed as a private investigator or is the qualified manager, officer, member, or manager of the licensee. The pocket card is to be composed of a durable material and may incorporate technologically advanced security features.
The bureau may charge a fee sufficient to reimburse the department’s costs for furnishing the pocket card. The fee charged shall not exceed the actual direct costs for system development, maintenance, and processing necessary to provide this service, and shall not exceed sixteen dollars ($16). When a person to whom a card is issued terminates his or her position, office, or association with the licensee, the card shall be surrendered to the licensee and within five days thereafter shall be mailed or delivered by the licensee to the bureau for cancellation. Every person, while engaged in any activity for which licensure is required, shall display his or her valid pocket card as provided by regulation.
(c) This section shall remain in effect only until January 1, 2021, and as of that date is repealed.
SEC. 17.
Section 7529 of the Business and Professions Code, as added by Section 7 of Chapter 669 of the Statutes of 2014, is amended to read:7529.
(a) Upon the issuance of a license, a pocket card of the size, design, and content as may be determined by the director shall be issued by the bureau to each licensee, as follows:(1) If the licensee is an individual, the pocket card shall be issued to the licensee and the licensee’s qualified manager.
(2) If the licensee is a partnership, the pocket card shall be issued to each partner of the partnership licensee active in the business and the licensee’s qualified manager.
(3) If the licensee is a corporation, the pocket card shall be issued to each officer active
in the business and the licensee’s qualified manager.
(b) The pocket card is evidence that the licensee is licensed pursuant to this chapter. The card shall contain the signature of the licensee, signature of the chief, and a photograph of the licensee, or bearer of the card, if the licensee is other than an individual. The card shall clearly state that the person is licensed as a private investigator or is the qualified manager or officer of the licensee. The pocket card is to be composed of a durable material and may incorporate technologically advanced security features. The bureau may charge a fee sufficient to reimburse the department’s costs for furnishing the pocket card. The fee charged shall not exceed the actual direct costs for system development, maintenance, and processing necessary to provide this service, and shall not exceed
sixteen dollars ($16). When a person to whom a card is issued terminates his or her position, office, or association with the licensee, the card shall be surrendered to the licensee and within five days thereafter shall be mailed or delivered by the licensee to the bureau for cancellation. Every person, while engaged in any activity for which licensure is required, shall display his or her valid pocket card as provided by regulation.
(c) This section shall become operative on January 1, 2021.
SEC. 18.
Section 7530 of the Business and Professions Code, as amended by Section 8 of Chapter 669 of the Statutes of 2014, is amended to read:7530.
(a) Except as provided in this section, a license issued under this chapter is not assignable.(b) A licensee may apply to the chief for consent, and upon receipt of the consent and payment of the processing fee authorized by Section 7570, may assign a license to another business entity as long as the direct and indirect owners of the assignor own all of the assignee immediately after the assignment.
SEC. 19.
Section 7531 of the Business and Professions Code is amended to read:7531.
A licensee shall at all times be legally responsible for the good conduct in the business of each of his or her employees or agents, including his or her qualified manager.SEC. 20.
Section 7533.2 is added to the Business and Professions Code, to read:7533.2.
(a) At the time of an initial application for licensure or reassignment, an applicant for an initial license or a licensee applying for reassignment of the license shall notify the bureau on the application for licensure or reassignment if the applicant or licensee is a limited liability company for the purposes of this chapter during the period of licensure. The bureau shall include this information on the Department of Consumer Affairs BreEZe License Verification Internet Web page.(b) This section shall become operative on July 1, 2018.
SEC. 21.
Section 7533.5 of the Business and Professions Code, as amended by Section 12 of Chapter 800 of the Statutes of 2016, is amended to read:7533.5.
(a) A licensee shall notify the bureau within 30 days of any change in its corporate officers required to be named pursuant to subdivision (h) of Section 7525.1 or members or managers required to be named pursuant to subdivision (i) of Section 7525.1, and of any addition of a new partner.(b) Applications, on forms prescribed by the director, shall be submitted by all new officers, members or managers, and partners. The director may suspend or revoke a license issued under this chapter if the director determines that the new officer, member or manager, or partner of a licensee has committed any of the acts constituting grounds to deny an application for a license or to take disciplinary
action against a licensee pursuant to Section 7538 or 7538.5, respectively.
(c) This section shall remain in effect only until January 1, 2021, and as of that date is repealed.
SEC. 22.
Section 7533.5 of the Business and Professions Code, as added by Section 13 of Chapter 800 of the Statutes of 2016, is amended to read:7533.5.
(a) A licensee shall notify the bureau within 30 days of any change in its corporate officers required to be named pursuant to subdivision (h) of Section 7525.1, and of any addition of a new partner.(b) Applications, on forms prescribed by the director, shall be submitted by all new officers and partners. The director may suspend or revoke a license issued under this chapter if the director determines that the new officer or partner of a licensee has committed any of the acts constituting grounds to deny an application for a license or to take disciplinary action against a licensee pursuant to Section 7538 or 7538.5, respectively.
(c) This section shall become operative on January 1, 2021.
SEC. 23.
Section 7536 of the Business and Professions Code is amended to read:7536.
(a) The business of each licensee shall be operated under the active direction, control, charge, or management, in this state, of the licensee, if he or she is qualified, or the person who is qualified to act as the licensee’s qualified manager, if the licensee is not qualified.(b) No person shall act as a qualified manager of a licensee until he or she has complied with each of the following:
(1) Demonstrated his or her qualifications by a written or oral examination, or a combination of both, if required by the director.
(2) Made a
satisfactory showing to the director that he or she has the qualifications prescribed in Section 7526 and that none of the facts stated in Section 7538 or 7538.5 exist as to him or her.
(c) A person shall not act as a qualified manager of more than five licensees. The person acting as a qualified manager shall share equally with the licensee the responsibility and any liability for the conduct of the business of the licensee and the actions of the employees and other personnel of the licensee. This section shall not apply to any licensee that notifies the bureau in writing that he or she is not conducting any business, but requests to maintain a current license status with the bureau. Whenever the licensee resumes conducting business, the licensee shall so inform the bureau in writing within 30 days.
(d) Any person acting as a qualified manager of a licensee shall be the holder of a qualification certificate issued by the bureau. The certificate, together with the current renewal certificate, shall be predominantly displayed below the private investigator’s license.
SEC. 24.
Section 7537 of the Business and Professions Code is amended to read:7537.
(a) In case of the death of a person licensed as an individual, a member of the immediate family of the deceased licensee shall be entitled to continue the business under the same license for 120 days following the death of the licensee, provided that written application for permission is made to the bureau within 30 days following the death of the licensee. At the end of the 120-day period, the license shall be automatically canceled. If no request is received within the 30-day period, the license shall be automatically canceled at the end of that period.(b) If the qualified manager ceases for any reason whatsoever to be connected with the
licensee to whom the license is issued, the licensee shall notify the bureau in writing 30 days from this cessation. If the notice of cessation is filed timely, the license shall remain in force for a period of 90 days after cessation or for an additional period, not to exceed one year, as approved by the director, pending the qualification of another qualified manager as provided in this chapter. After the 90-day period or additional period, as approved by the director, the license shall be automatically suspended, unless the bureau receives written notification that the license is under the active charge of a qualified manager. If the licensee fails to notify the bureau within the 30-day period, his or her license shall be automatically suspended and may be reinstated only upon the filing of an application for reinstatement, payment of the reinstatement fee, and the qualification of a qualified
manager as provided in this chapter.
(c) In the case of the death or disassociation of a partner of an entity licensed as a partnership, the licensee shall notify the bureau, in writing, within 30 days from the death or disassociation of the individual. If notice is given, the license shall remain in force for 90 days following the death or disassociation. At the end of this period the license shall be automatically canceled. If the licensee fails to notify the bureau within the 30-day period, the license shall be automatically canceled.
(d) A license extended under this section is subject to all other provisions of this chapter.
SEC. 25.
Section 7538 of the Business and Professions Code, as amended by Section 10 of Chapter 669 of the Statutes of 2014, is amended to read:7538.
(a) After a hearing the director may deny a license unless the applicant makes a showing satisfactory to the director that the applicant, if an individual, and the applicant’s qualified manager have not, or, if the applicant is a person other than an individual, that its qualified manager and each of its officers, partners, members, or managers have not:(1) Committed any act that, if committed by a licensee, would be a ground for the suspension or revocation of a license under this chapter.
(2) Committed any act constituting dishonesty or fraud.
(3) Committed any act or crime constituting grounds for denial of licensure under Section 480, including illegally using, carrying, or possessing a deadly weapon.
(4) Been refused a license under this chapter or had a license revoked.
(5) Been an officer, partner, qualified manager, member, or manager of any person who has been refused a license under this chapter or whose license has been revoked.
(6) While unlicensed committed, or aided and abetted the commission of, any act for which a license is required by this chapter.
(7) Knowingly made any false statement in his or her application.
(b) This section shall remain in effect only until January 1, 2021, and as of that date is repealed.
SEC. 26.
Section 7538 of the Business and Professions Code, as added by Section 11 of Chapter 669 of the Statutes of 2014, is amended to read:7538.
(a) After a hearing the director may deny a license unless the applicant makes a showing satisfactory to the director that the applicant, if an individual, and the applicant’s qualified manager have not, or, if the applicant is a person other than an individual, that its qualified manager and each of its officers and partners have not:(1) Committed any act that, if committed by a licensee, would be a ground for the suspension or revocation of a license under this chapter.
(2) Committed any act constituting dishonesty or fraud.
(3) Committed any act or crime
constituting grounds for denial of licensure under Section 480, including illegally using, carrying, or possessing a deadly weapon.
(4) Been refused a license under this chapter or had a license revoked.
(5) Been an officer, partner, or qualified manager of any person who has been refused a license under this chapter or whose license has been revoked.
(6) While unlicensed committed, or aided and abetted the commission of, any act for which a license is required by this chapter.
(7) Knowingly made any false statement in his or her application.
(b) This section shall become operative
on January 1, 2021.
SEC. 27.
Section 7538.5 of the Business and Professions Code, as amended by Section 12 of Chapter 669 of the Statutes of 2014, is amended to read:7538.5.
(a) The director may refuse to issue any license provided for in this chapter to any of the following:(1) An individual who has had any license revoked, has a license currently under suspension, or failed to renew his or her license while under suspension.
(2) An individual who, while acting as a partner of a partnership, an officer or director of a corporation, or a member, manager, or officer of a limited liability company, had his or her license revoked, has a license currently under suspension, or failed to renew his or her license while under suspension.
(3) An individual who, while acting as a partner of the partnership, an officer, director of the corporation, or a member, manager, or officer of a limited liability company meets both of the following conditions:
(A) He or she was a partner of any partnership, an officer or director of any corporation, or a member, manager, or officer of any limited liability company whose license was revoked, is currently under suspension, or was not renewed while under suspension.
(B) While acting as a partner, officer, director, member, or manager, he or she participated in any of the prohibited acts for which the license was revoked or suspended.
(4) An individual who is serving or has served as the qualified manager
for any licensee that has had its license revoked, is currently under suspension, or failed to renew while under suspension.
(b) This section shall remain in effect only until January 1, 2021, and as of that date is repealed.
SEC. 28.
Section 7538.5 of the Business and Professions Code, as added by Section 13 of Chapter 669 of the Statutes of 2014, is amended to read:7538.5.
(a) The director may refuse to issue any license provided for in this chapter to any of the following:(1) An individual who has had any license revoked, has a license currently under suspension, or failed to renew his or her license while under suspension.
(2) An individual who, while acting as a partner of a partnership, or an officer or director of a corporation, had his or her license revoked, has a license currently under suspension, or failed to renew his or her license while under suspension.
(3) A person who, while acting as a partner of the partnership, or
an officer or director of the corporation, meets both of the following conditions:
(A) He or she was a partner of any partnership, or an officer or director of any corporation, whose license was revoked, is currently under suspension, or was not renewed while under suspension.
(B) He or she, while acting as a partner, officer, or director, participated in any of the prohibited acts for which the license was revoked or suspended.
(4) An individual who is serving or has served as the qualified manager for any licensee that has had its license revoked, is currently under suspension, or failed to renew while under
suspension.
(b) This section shall become operative on January 1, 2021.
SEC. 29.
Section 7539 of the Business and Professions Code, as amended by Section 14 of Chapter 669 of the Statutes of 2014, is amended to read:7539.
(a) Any licensee or officer, director, partner, member, manager, or qualified manager of a licensee may divulge to any law enforcement officer or district attorney, or his or her representative, any information he or she may acquire as to any criminal offense, but he or she shall not divulge to any other person, except as otherwise required by law, any information acquired by him or her except at the direction of the employer or client for whom the information was obtained.(b) A licensee or officer, director, partner, member, manager, qualified manager, or employee of a licensee shall not knowingly make any false report to his or her employer or client for whom information was
being obtained.
(c) A written report shall not be submitted to a client except by the licensee, qualified manager, or a person authorized by one or either of them, and the person submitting the report shall exercise diligence in ascertaining whether or not the facts and information in the report are true and correct.
(d) A licensee, or officer, director, partner, manager, member, qualified manager, or employee of a licensee shall not use a badge in connection with the official activities of the licensee’s business.
(e) A licensee, or officer, director, partner, manager, member, qualified manager, or employee of a licensee, shall not use a title, or wear a uniform, or use an insignia, or use an identification card, or make
any statement with the intent to give an impression that he or she is connected in any way with the federal government, a state government, or any political subdivision of a state government.
(f) A licensee, or officer, partner, manager, member, qualified manager, or employee of a licensee shall not use any identification to indicate that he or she is licensed as a private investigator other than the official identification card issued by the bureau or the business card regularly used by the business. However, a licensee may issue an employer identification card.
(g) A licensee, or officer, director, partner, manager, member, qualified manager, or employee of a licensee, shall not enter any private building or portion thereof, except premises commonly accessible to the public,
without the consent of the owner or of the person in legal possession thereof.
(h) A licensee shall not permit an employee or agent in his or her own name to advertise, engage clients, furnish reports or present bills to clients, or in any manner conduct business for which a license is required under this chapter. All business of the licensee shall be conducted in the name of and under the control of the licensee.
(i) A licensee, or officer, director, partner, manager, member, qualified manager, or employee of a licensee shall not knowingly and directly solicit employment from any person who has directly sustained bodily injury or from that person’s spouse or other family member to obtain authorization on behalf of the injured person as an investigator to investigate the
accident or act that resulted in injury or death to that person or damage to the property of that person. Nothing in this subdivision shall prohibit the soliciting of employment from that injured person’s attorney, insurance company, self-insured administrator, insurance adjuster, employer, or any other person having an indirect interest in the investigation of the injury. This subdivision shall not apply to any business agent or attorney employed by a labor organization. A licensee, or officer, director, partner, manager, member, or qualified manager of a licensee shall not pay or compensate any of his or her employees or agents on the basis of a bonus, bounty, or quota system whereby a premium is placed on the number of employer or client rule violations or infractions purportedly discovered as a result of any investigation made by a licensee.
(j) A licensee shall not use a fictitious business name in connection with the official activities of the licensee’s business, except as provided by the bureau.
(k) This section shall remain in effect only until January 1, 2021, and as of that date is repealed.
SEC. 30.
Section 7539 of the Business and Professions Code, as added by Section 15 of Chapter 669 of the Statutes of 2014, is amended to read:7539.
(a) Any licensee or officer, director, partner, or qualified manager of a licensee may divulge to any law enforcement officer or district attorney, or his or her representative, any information he or she may acquire as to any criminal offense, but he or she shall not divulge to any other person, except as otherwise required by law, any information acquired by him or her except at the direction of the employer or client for whom the information was obtained.(b) A licensee or officer, director, partner, qualified manager, or employee of a licensee shall not knowingly make any false report to his or her employer or client for whom information was being obtained.
(c) A written report shall not be submitted to a client except by the licensee, qualified manager, or a person authorized by one or either of them, and the person submitting the report shall exercise diligence in ascertaining whether or not the facts and information in the report are true and correct.
(d) A licensee, or officer, director, partner, qualified manager, or employee of a licensee shall not use a badge in connection with the official activities of the licensee’s business.
(e) A licensee, or officer, director, partner, qualified manager, or employee of a licensee, shall not use a title, or wear a uniform, or use an insignia, or use an identification card, or make any statement with the intent to give an impression
that he or she is connected in any way with the federal government, a state government, or any political subdivision of a state government.
(f) A licensee, or officer, partner, qualified manager, or employee of a licensee shall not use any identification to indicate that he or she is licensed as a private investigator other than the official identification card issued by the bureau or the business card regularly used by the business. However, a licensee may issue an employer identification card.
(g) A licensee, or officer, director, partner, qualified manager, or employee of a licensee, shall not enter any private building or portion thereof, except premises commonly accessible to the public, without the consent of the owner or of the person in legal possession thereof.
(h) A licensee shall not permit an employee or agent in his or her own name to advertise, engage clients, furnish reports or present bills to clients, or in any manner conduct business for which a license is required under this chapter. All business of the licensee shall be conducted in the name of and under the control of the licensee.
(i) A licensee, officer, director, partner, qualified manager, or employee of a licensee shall not knowingly and directly solicit employment from any person who has directly sustained bodily injury or from that person’s spouse or other family member to obtain authorization on behalf of the injured person as an investigator to investigate the accident or act that resulted in injury or death to that person or damage to the property of that person. Nothing
in this subdivision shall prohibit the soliciting of employment from that injured person’s attorney, insurance company, self-insured administrator, insurance adjuster, employer, or any other person having an indirect interest in the investigation of the injury. This subdivision shall not apply to any business agent or attorney employed by a labor organization. A licensee, officer, director, partner, or qualified manager of a licensee shall not pay or compensate any of his or her employees or agents on the basis of a bonus, bounty, or quota system whereby a premium is placed on the number of employer or client rule violations or infractions purportedly discovered as a result of any investigation made by a licensee.
(j) A licensee shall not use a fictitious business name in connection with the official activities of the licensee’s
business, except as provided by the bureau.
(k) This section shall become operative on January 1, 2021.
SEC. 31.
Section 7541 of the Business and Professions Code is amended to read:7541.
(a) Except as otherwise provided by this section, an applicant, or his or her manager, for a license as a private investigator shall have had at least three years’ experience in investigation work. One year’s experience shall consist of not less than 2,000 hours of actual compensated work performed by each applicant preceding the filing of an application.(1) An applicant who holds a law degree or bachelor’s degree in police science, criminal justice, criminal law, or the equivalent thereof from an accredited college shall be credited with 2,000 hours of experience in investigation work.
(2) An applicant who holds an associate
degree in police science, criminal justice, criminal law, or the equivalent thereof from an accredited college shall be credited with 1,000 hours of experience in investigation work.
(3) The total amount of time credited to an applicant for degrees described in this subdivision shall not exceed 2,000 hours of experience in investigation work.
(b) An applicant shall substantiate the claimed years of qualifying experience and the exact details as to the character and nature thereof by written certifications from the employer or qualified manager, subject to independent verification by the director as he or she may determine.
(1) Notwithstanding any other law, only an employer, qualified manager, or his or her
designated agent may certify experience for purposes of this section.
(2) For purposes of this section, the term “employer” shall mean only those persons, corporations, partnerships, proprietorships, or other associations which, in the employ of the designated individual, regularly and routinely withheld income taxes and other payroll deductions for direct forwarding to governmental taxing authorities.
(3) For the purposes of this section, the term “qualified manager” shall mean only a manager who has qualified pursuant to Section 7536, who has directly overseen the work and experience of the applicant, and is under an employment or contractual arrangement to provide primary supervision of the applicant.
(c) An employer who is a licensee or qualified manager shall respond in writing within 30 days to an applicant’s written request for certifications of the applicant’s work experience as an employee and either provide the certifications or the reasons for denial. If the applicant notifies the director in writing, under penalty of perjury, that the applicant is unable to obtain the required written response from a licensee or qualified manager, or provides the licensee’s or qualified manager’s written denial and states, under penalty of perjury, that the licensee’s or qualified manager’s reasons for denial are invalid or insufficient and the director concurs, the director may require the licensee or qualified manager to provide the bureau with all relevant employment records maintained pursuant to Section 7531.5 regarding the applicant for evaluation in substantiating the applicant’s employment
experience.
SEC. 32.
Section 7541.1 of the Business and Professions Code is amended to read:7541.1.
(a) Notwithstanding any other law, experience for purposes of taking the examination for licensure as a private investigator shall be limited to those activities actually performed in connection with investigations, as defined in Section 7521, and only if those activities are performed by persons who are employed or managed in the following capacities:(1) Sworn law enforcement officers possessing powers of arrest and employed by agencies in the federal, state, or local government.
(2) Military police of the Armed Forces of the United States or the National Guard.
(3) An insurance adjuster or their employees subject to Chapter 1 (commencing with Section 14000) of Division 5 of the Insurance Code.
(4) Persons employed by a private investigator who are duly licensed in accordance with this chapter, or managed by a qualified manager in accordance with Section 7536.
(5) Persons employed by repossessors duly licensed in accordance with Chapter 11 (commencing with Section 7500), only to the extent that those persons are routinely and regularly engaged in the location of debtors or the location of personal property utilizing methods commonly known as “skip tracing.” For purposes of this section, only that experience acquired in that skip tracing shall be credited toward qualification to take the examination.
(6) Persons duly trained and certified as an arson investigator and employed by a public agency engaged in fire suppression.
(7) Persons trained as investigators and employed by a public defender to conduct investigations.
(8) (A) Persons trained as investigative reporters and employed by a media source, as defined in Section 1070 of the Evidence Code, whose investigative journalism experience is comprised of conducting primary investigations and producing investigative projects.
(B) For purposes of this paragraph “primary investigation” means original and in-depth research and analysis involving multiple sources, including, but not limited to,
public records, databases, archives, published and unpublished documents, witnesses, informers, whistleblowers, public officials, and experts, to produce investigative projects.
(b) The following activities shall not be deemed to constitute acts of investigation for purposes of experience toward licensure:
(1) The serving of legal process or other documents.
(2) Activities relating to the search for heirs or similar searches which involve only a search of public records or other reference sources in the public domain.
(3) The transportation or custodial attendance of persons in the physical custody of a law enforcement agency.
(4) The provision of bailiff or other security services to a court of law.
(5) The collection or attempted collection of debts by telephone or written solicitation after the debtor has been located.
(6) The repossession or attempted repossession of personal property after that property has been located and identified.
(c) Where the activities of employment of an applicant include those which qualify as bona fide experience as stated in this section as well as those which do not qualify, the director may, by delegation to the bureau, determine and apportion that percentage of experience for which any applicant is entitled to credit.
SEC. 33.
Section 7561.1 of the Business and Professions Code is amended to read:7561.1.
The director may deny, suspend, or revoke a license issued under this chapter if he or she determines that the licensee or his or her qualified manager, if an individual, or if the licensee is a person other than an individual, that any of its officers, directors, partners, members, managers, or qualified manager, has:(a) Made any false statement or given any false information in connection with an application for a license or a renewal or reinstatement of a license.
(b) Violated any provisions of this chapter.
(c) Violated any rule of the director
adopted pursuant to the authority contained in this chapter.
(d) Been convicted of any act or crime constituting grounds for denial of licensure under Section 480, including illegally using, carrying, or possessing a deadly weapon.
(e) Impersonated, or permitted or aided and abetted an employee to impersonate a law enforcement officer or employee of the United States of America, or of any state or political subdivision thereof.
(f) Committed or permitted any employee to commit any act, while the license was expired which would be cause for the suspension or revocation of a license, or grounds for the denial of an application for a license.
(g) Willfully failed
or refused to render to a client services or a report as agreed between the parties and for which compensation has been paid or tendered in accordance with the agreement of the parties.
(h) Committed assault, battery, or kidnapping, or using force or violence on any person, without proper justification.
(i) Knowingly violated, or advised, encouraged, or assisted the violation of any court order or injunction in the course of business as a licensee.
(j) Acted as a runner or capper for any attorney.
(k) Been convicted of a violation of Section 148 of the Penal Code.
(l) Committed any act
which is a ground for denial of an application for a license under this chapter.
(m) Committed any act prohibited by Chapter 1.5 (commencing with Section 630) of Title 15 of Part 1 of the Penal Code.
(n) Purchased, possessed, or transported any tear gas weapon except as authorized by law. A violation of this subdivision may be punished by the suspension of a license for a period to be determined by the director.
(o) Been convicted of a violation of Section 95.3 of the Penal Code.
SEC. 34.
Section 7561.3 of the Business and Professions Code is amended to read:7561.3.
The director may suspend or revoke a license issued under this chapter if he or she determines that the licensee or his or her qualified manager, if an individual, or if the licensee is a person other than an individual, that any of its officers, directors, partners, members, managers, or qualified manager, has:(a) Used any letterhead, advertisement, or other printed matter, or in any manner whatever represented that he or she is an instrumentality of the federal government, a state, or any political subdivision thereof.
(b) Used a name different from that under which he or she is currently licensed in any
advertisement, solicitation, or contract for business.
SEC. 35.
Section 7561.4 of the Business and Professions Code is amended to read:7561.4.
The director may suspend or revoke a license issued under this chapter if he or she determines that the licensee or his or her qualified manager, if an individual, or if the licensee is a person other than an individual, that any of its officers, directors, partners, members, managers, or qualified manager, has committed any act in the course of the licensee’s business constituting dishonesty or fraud.“Dishonesty or fraud” as used in this section, includes, in addition to other acts not specifically enumerated herein:
(a) Knowingly making a false statement relating to evidence or information obtained in the course of
employment, or knowingly publishing a slander or a libel in the course of business.
(b) Using illegal means in the collection or attempted collection of a debt or obligation.
(c) Manufacture of evidence.
(d) Acceptance of employment adverse to a client or former client relating to a matter with respect to which the licensee has obtained confidential information by reason of or in the course of his or her employment by the client or former client.
SEC. 36.
Section 7570 of the Business and Professions Code, as amended by Section 17 of Chapter 800 of the Statutes of 2016, is amended to read:7570.
The fees prescribed by this chapter are as follows:(a) The application and examination fee for an original license shall not exceed fifty dollars ($50).
(b) The application fee for an original branch office certificate shall not exceed thirty dollars ($30).
(c) The fee for an original license for a private investigator shall not exceed one hundred seventy-five dollars ($175).
(d) The renewal fee is as follows:
(1) For a license as a private investigator, the fee shall not
exceed one hundred twenty-five dollars ($125).
(2) For a branch office certificate for a private investigator, the fee shall not exceed thirty dollars ($30).
(e) The delinquency fee is 50 percent of the renewal fee in effect on the date of expiration.
(f) A reinstatement fee is equal to the amount of the renewal fee plus the regular delinquency fee.
(g) The fee for reexamination of an applicant or his or her qualified manager shall not exceed fifteen dollars ($15).
(h) The processing fee for the assignment of a license pursuant to Section 7530 shall not exceed one hundred twenty-five dollars ($125).
(i) This section shall remain in effect only until January 1, 2021, and as of that date is repealed.
SEC. 37.
Section 7570 of the Business and Professions Code, as amended by Section 18 of Chapter 800 of the Statutes of 2016, is amended to read:7570.
The fees prescribed by this chapter are as follows:(a) The application and examination fee for an original license shall not exceed fifty dollars ($50).
(b) The application fee for an original branch office certificate shall not exceed thirty dollars ($30).
(c) The fee for an original license for a private investigator shall not exceed one hundred seventy-five dollars ($175).
(d) The renewal fee is as follows:
(1) For a license as a private investigator, the fee shall not
exceed one hundred twenty-five dollars ($125).
(2) For a branch office certificate for a private investigator, the fee shall not exceed thirty dollars ($30).
(e) The delinquency fee is 50 percent of the renewal fee in effect on the date of expiration.
(f) A reinstatement fee is equal to the amount of the renewal fee plus the regular delinquency fee.
(g) The fee for reexamination of an applicant or his or her qualified manager shall not exceed fifteen dollars ($15).
(h) This section shall become operative on January 1, 2021.
