On October 22, the California DFPI announced that beginning in February 15, 2025, it will register and regulate debt settlement services, education financing, income-based advances and student debt relief providers. The final order created new regulations under the California Consumer Financial Protection Law (CCFPL).
The order outlined comprehensive rules and definitions applicable to entities offering financial products and services to California residents, including “debt settlement services,” “student debt relief services,” “education financing,” “charges” and “income-based advances.” It also established annual reporting and fee requirements. The regulations mandated that entities providing these services must adhere to specific standards, including disclosing fees and charges, maintaining accurate records, and ensuring compliance with state and federal laws. The order specified the process for applicable entities to register with DFPI. Additionally, the order addressed the confidentiality of application materials, the responsibilities of registrants to update their information, and the penalties for false or misleading statements.
Financial service providers subject to the new regulations must file a registration application by February 15, 2025, to continue operating legally in California.
