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New consumer financial protection laws are in effect in California for 2021 and couldn’t come at a better time. A new law gives the state the power to investigate your complaints about financial products and services that were once unregulated and now are popular during the pandemic.
According to Bankrate.com, half of American households are reporting lost income since March, and some businesses are preying on that despair for profit.
Manuel Alvarez is commissioner of California’s Department of Financial Protection and Innovation.
"We strongly encourage members of the public to contact us if they believe they have been victimized by a financial fraud or scam," Alvarez said.
Alvarez said a new state law allows his department to enforce federal laws through civil complaints, prohibiting unfair, deceptive and abusive practices within the financial services industry, like investment schemes. He says there are many questionable products and services being offered.
"This could include anything from debt collection services to consumer repair services or any other type of asset recovery type services or products," Alvarez said.
State lawmakers passed the new consumer protections in the last legislative session, long before COVID-19 was on the radar, but its enactment is right on time.
The pandemic punctuated the need in California.
As the world’s 5th largest economy, California leads the nation in job loss, leaving many people scrambling for solutions to earn money or pay off debt and often finding businesses that only compound the problem.
Alvarez said complaints about financial products and services to his department are rising.
Coronavirus Deaths in Your City and State — and Across the US
These charts use daily coronavirus death data from Johns Hopkins University to show the seven-day moving average of deaths at the city, state and country level.
The impact of coronavirus varies enormously in the United States from one place to another.
Source: Johns Hopkins University.
Credit: Visuals by Amy O’Kruk/NBC, data analysis by Ron Campbell/NBC
"Roughly a 40% increase in the volume of consumer complaint since the pandemic started," Alavarez said.
If a complaint itself doesn’t guarantee an investigation, the DFPI, like the Better Business Bureau, can work to seek a resolution on a your behalf.
But they also work with law enforcement in case a criminal prosecution is necessary.
