Consumer Protection

SAN FRANCISCO - Attorney General Kamala D. Harris and the California Air Resources Board (CARB) today announced a landmark $14.7 billion national settlement with Volkswagen over allegations that the company violated environmental and consumer protection laws by installing “defeat device” software to bypass emissions controls in its 2.0 liter diesel vehicles.

As part of the national agreement, which is subject to approval by the court, Volkswagen will spend approximately $10 billion to buy back or modify these vehicles, as well as pay $2.7 billion into a trust to support environmental programs and reduce emissions and an additional $2 billion on investments and promotion of zero emissions vehicles.  The agreement preserves the Attorney General’s and CARB’s claims for civil penalties and prospective injunctive relief, as well as their claims related to 3.0 liter diesel vehicles.

In addition to providing consumer relief funding, California will receive $1.18 billion, representing more than one-quarter of the funding VW must provide for environmental projects in states injured by the company's conduct and investments it must make in zero emission technology.

“Our state and national environmental protection laws exist to protect public health and to preserve our planet for future generations.  Volkswagen undermined these objectives by deceiving California consumers and flagrantly violating California environmental and consumer protection laws by manipulating its diesel vehicles to produce false results when undergoing emissions testing,” said Attorney General Kamala Harris. “This landmark agreement not only ensures that consumers who were deceived are fairly compensated, but also requires Volkswagen to make unprecedented investments in protecting our environment and advancing zero emission technology.”

As part of the agreement, VW will offer compensation to those who own or lease a VW or Audi 2.0 liter vehicle as of September 18, 2015.  Owners have the option of having Volkswagen buy back their vehicle or, if approved by CARB and EPA, having VW modify their vehicle to reduce its emissions.  Owners who opt for a buyback or modification will also receive an additional cash payment of at least $5,100.  Some owners may receive as much as $10,000.

In addition to consumer relief and getting polluting cars off the road via the buyback and modification program, which is anticipated to cost Volkswagen over $10 billion, Volkswagen is also required to pay $2.7 billion into a trust to support environmental programs throughout the country to reduce emissions. CARB will receive and direct 14.12%, $380 million, of these trust funds to fund environmental mitigation projects in California.  Volkswagen is also required to buy back, modify, or scrap at least 85% of the subject vehicles nationally and in California, and it is required to pay for additional mitigation projects if it falls short of that requirement.   

Volkswagen must also spend $2 billion over a 10-year period to promote zero emissions vehicles through educational information, research and development, and infrastructure development (such as building charging stations), to further mitigate emissions and help right the market that was manipulated by the false emissions results in Volkswagen diesel vehicles.  Forty percent, or $800 million, of these investments will be made in California, pursuant to investment plans that will be subject to approval by CARB.

“This is a good deal for California’s environment and for California consumers. It will bring over a billion dollars of projects to California to supercharge our expanding zero-emission vehicle market, and fully mitigate the environmental harm to our air as a result of VW’s cheating,” said CARB Chair Mary D. Nichols. “The Consent Decree also recognizes the crucial contribution the dogged engineers in CARB’s testing lab played in exposing the illegal device in the first place – and the exceptionally costly and difficult challenges we face in our fight for cleaner air in a state where tens of millions breathe the most heavily polluted air in the nation.”

Volkswagen programmed software in its diesel cars to achieve lower emissions while undergoing testing, but in normal driving conditions, their cars were emitting up to 40 times more harmful nitrogen oxides than allowed by state and federal law. 

The parties settling claims against Volkswagen in this major agreement include the California Attorney General’s Office, CARB, the U.S. Department of Justice, and the U.S. Environmental Protection Agency (EPA).

California is uniquely affected, not only because of our robust environmental protection laws and CARB’s unique enforcement and regulatory role, but also because our state has the largest number of affected consumers.

In conjunction with the consent decree, the California Attorney General’s office filed a joint complaint with CARB in the Northern District of California this morning.  The complaint is attached to the online version of this news release at www.oag.ca.gov/news.

The agreement is subject to approval by the court following a public comment period.

The agreement is specific to 2.0 liter vehicles and does not include Volkswagen and Audi 3.0 liter vehicles that are alleged to have similar defeat devices installed.  It also preserves the ability of the Attorney General, CARB, and the EPA to seek civil penalties and further injunctive relief.

LOS ANGELES – Attorney General Kamala D. Harris today sent a letter to the United States Department of Education, urging the Department to revoke federal recognition of the Accrediting Council for Independent Colleges and Schools’ (ACICS).  ACICS is a major accreditor of for-profit schools and was the accreditor for the now defunct Corinthian Colleges, Inc. (“Corinthian”).  While accredited by ACICS, Corinthian intentionally targeted low-income, vulnerable Californians through deceptive and false advertisements and aggressive marketing campaigns that misrepresented job placement rates and school programs.

“The predatory scheme devised by executives at Corinthian Colleges, Inc. was unconscionable. And despite enforcement actions by the California Department of Justice and the federal government against Corinthian, ACICS continued to accredit Corinthian, hurting thousands of students in the process,” said Attorney General Harris. “Students relied on Corinthian’s accreditation status, believing they were obtaining a high quality-education with real job prospects. The Department of Education should not renew ACICS’ federal recognition and protect students from harm by predatory, for-profit colleges.”

In issuing this letter, Attorney General Harris supports the 13 other state Attorneys General who voiced their concerns over the renewal of ACICS as an accreditation agency.  These Attorneys General noted their opposition in a letter that included a discussion of ACICS-related issues and concerns in their respective states, also noting the failure of ACICS to take appropriate action in response to public enforcement actions by states and federal agencies.

Today’s letter is Attorney General Harris’ latest effort to protect vulnerable students from fraud and predatory practices by dishonest institutions.  Yesterday, Attorney General Harris, 10 other Attorneys General, and the State of Hawaii, Office of Consumer Protection sent a letter to the Senate Armed Services Committee opposing an amendment that would weaken existing protections and would instead allow any college approved for military tuition benefits to have unrestricted access to recruit on military bases.  In March 2016, Attorney General Harris obtained a $1.1 billion judgment against Corinthian as a result of their predatory and unlawful practices that left tens of thousands of students with large amounts of debt and useless degrees. 

In February 2016, Attorney General Harris and 7 other Attorneys General sent a letter to the Secretary of Veterans Affairs urging greater protections for veterans affected by predatory school practices.  Also in February 2016, Attorney General released a statement and in March 2016 joined 8 other Attorneys General in a letter urging the Department of Education to adopt stronger regulations, including in “borrower defense to repayment,” to protect students misled by Corinthian and other predatory for-profit colleges.  In April 2015, Attorney General Harris and 8 other state Attorneys General sent a letter to the U.S. Department of Education urging immediate debt relief for the students who attended Heald College and other Corinthian Colleges, Inc. campuses.

In October 2013, Attorney General Kamala D. Harris led the charge against Corinthian Colleges, Inc. and its schools in California (Everest, Heald, and Wyotech colleges), seeking to put an end to abusive practices that left tens of thousands of students with useless degrees and tens of thousands of dollars in debt.

Attorney General Harris remains committed to protecting vulnerable students.  A copy of the letter is attached to the electronic version of this release at www.oag.ca.gov/news.

LOS ANGELES - Attorney General Kamala D. Harris and the Attorneys General of Connecticut, District of Columbia, Hawaii, Iowa, Maine, Maryland, Massachusetts, Minnesota, New York, Pennsylvania, and the State of Hawaii, Office of Consumer Protection yesterday sent a letter to the Senate Armed Services Committee expressing opposition to an amendment to the National Defense Authorization Act (NDAA) proposed by Senator Joe Manchin (D-WV) that would allow any college approved for military tuition benefits to have unrestricted access to recruit on military bases. 

“Predatory schemes targeting veterans are unconscionable,” said Attorney General Harris.  “The proposed amendment would weaken current rules intended to protect our servicemembers, and harm veterans by making them vulnerable to fraud and exploitation.  We must protect our nation’s veterans and servicemembers from predators who would exploit them for their educational benefits.”

Under existing standards, educational institutions already have sufficient access to military installations, especially for counseling purposes.  This amendment would weaken the existing protections and leave veterans and servicemembers more susceptible to aggressive and deceptive recruiters on military properties.

Attorney General Harris and the other state attorneys general also point out that current protections are indeed insufficient and should be strengthened to ensure that servicemembers are able to perform their duties free from harassment by unscrupulous recruiters.

In issuing this letter, the attorneys general join a number of military and veterans service organizations as well as other advocacy organizations in voicing concerns over the amendment. These organizations have noted their opposition in the following letters: http://veteranseducationsuccess.org/s/Letter-to-Manchin-re-NDAA-43d5.pdf

http://veteranseducationsuccess.org/s/Letter-to-McCain-Reed-re-NDAA-Manchin-Provision-arm9.pdf

This letter is Attorney General Harris’ latest effort to protect veterans from targeted scams and predatory practices.  In March of this year, Attorney General Harris obtained a $1.1 billion default judgment against Corinthian Colleges, which targeted servicemembers and veterans and illegally used the seals of the military services in its marketing materials.  Attorney General Harris and seven states also sent a letter to the Department of Veterans Affairs urging VA Secretary Robert McDonald to take steps to ensure that veterans are given accurate information about the risks associated with using their benefits at predatory schools like the now-defunct Corinthian Colleges, Inc.  

Last year, Attorney General Harris issued a consumer alert warning veterans and their survivors to be on alert following a rise in reported pension poaching scams, and last Friday, in honor of Memorial Day, issued consumer tips to help California servicemembers and veterans protect themselves from common scams. In November 2015, Attorney General Harris announced a stipulated judgment against JPMorgan Chase over allegations of credit card debt-collection abuses that violated the Servicemembers Civil Relief Act and the California Military Veterans Code and required the payment of restitution to servicemember-victims nationwide.  The Attorney General’s office has also provided training and support to military legal assistance attorneys on consumer protection issues.

The letter to Senator Manchin opposing the amendment is attached to the online version of this news release at www.oag.ca.gov/news.

LOS ANGELES —Attorney General Kamala D. Harris today issued the following tips to help California servicemembers and veterans protect themselves from scams.  Scammers target those serving our country, attempting to prey on their steady and hard-earned incomes.  The youngest men and women in uniform are particularly vulnerable as they are often living away from home for the first time and are only beginning to manage their finances independently.

“On Memorial Day, we honor the military veterans who made the ultimate sacrifice in service of our nation,” said Attorney General Harris. “While we remember the bravery, courage and sacrifice of our veterans, we are also reminded that too many men and women who serve our nation are targeted by scam artists and predators.  My office remains vigilant in support of all veterans, will protect servicemembers from fraud, and will hold accountable those who prey upon members of our military.”

WHAT TO LOOK OUT FOR

There are many different scams targeting servicemembers and veterans, but scammers tend to follow similar patterns.  Here are some of the most common scams of which to be aware:

• Predatory auto sales and financing.  Car dealers located near military bases may try to lure servicemembers with false promises of special deals for military personnel.  Often, these so-called deals conceal the terms of purchase for the vehicle and result in the servicemember drastically overpaying for both the vehicle and cost of financing.  For example, dealers may insist that military personnel will not qualify for financing unless they purchase overpriced add-ons they do not need.  Other times, the dealer may contact a servicemember who previously completed a transaction and drove a car off the lot to inform him that the initial financing fell through and insist on renegotiating for far worse terms.  Servicemembers should not rely on oral promises nor feel pressured to enter into any purchase without first reading and understanding the contract. 

• Storage units.  Servicemembers may spend months or years away from their belongings and often must rely on storage services while they are gone.  During deployment, stored possessions benefit from additional legal protections to prevent them from being sold at auction as a result of a default in rental payments.  Unscrupulous storage complexes may claim ignorance of military status or induce servicemembers to sign away their rights in order to auction their property while they are away.  Military personnel should notify storage companies of their military affiliation and should not agree to waive the rights designed to protect them. 

• Rental scams.  Because they may relocate frequently to unfamiliar places, servicemembers should be particularly vigilant about online scammers who use websites like Craigslist to lure would-be renters into paying deposits for non-existent rental properties.  The online advertisements may appear legitimate on the surface, but rentals listed at abnormally low rates or landlords requiring a deposit prior to showing the property usually signal a scam.  Particularly with peak Permanent Change of Station (PCS) season fast approaching, military renters should watch out for insistent demands that instill a false sense of urgency and should avoid wiring money to reserve apartments sight unseen.  Using installation housing services offices or established property management companies to locate potential housing is advisable.

• Education rip-offs.  Veterans Administration education benefits provide a unique and valuable opportunity for military personnel to pursue higher education.  Too often, however, recipients become the targets of disreputable for-profit colleges that are happy to pocket hard-earned benefits but provide little education in return.  Servicemembers and veterans should take great care to ensure that they use their benefits wisely by thoroughly researching educational opportunities before using their benefits.  The G.I. Bill Comparison Tool may be helpful in determining how to best utilize these benefits.   

• Pension scams.  Organizations professing a sincere concern for veterans may approach a veteran or his/her family about helping them qualify for VA pension benefits under the Aid and Attendance Program.  These organizations purport to employ financial wizardry to help veterans meet the program’s income and asset limitations.  But the organizations often charge high fees and receive lucrative undisclosed commissions for the financial products they sell to unsuspecting veterans.  Applicants who utilize this assistance may later discover that they no longer have access to their assets or that they are disqualified from other government programs, such as Medicaid.  For additional information, see Attorney General Harris’ Consumer Alert on Veteran “Pension Poaching” Scams.

HOW TO PROTECT YOURSELF AND YOUR FAMILY

• Be vigilant in any consumer transaction in which your military affiliation is involved.  While there are certainly many respectable businesses that offer special deals to servicemembers and veterans, there are also plenty of dishonest merchants who will try to use that information to take advantage of you.

• Be very careful when you encounter testimonials from your fellow servicemembers or from veterans working for merchants.  Many scammers set up their businesses near military bases and hire veterans as salespeople, in an attempt to prey on the trust between military personnel.  Sometimes they also offer special deals or discounts to servicemembers in exchange for promoting their goods and services to other members of the military.  You should be aware of these practices and careful about relying on claims that seem too good to be true.

• Know all the terms of any installment purchase you make and look out for attempts to hide any terms from you.  Salespeople will often focus a servicemember’s attention on the monthly payment for a particular purchase, which can distract attention from a sales price inflated well beyond what a buyer would ordinarily pay.  Beware of bait and switch tactics and never sign incomplete documents or contracts you have not reviewed in detail.

• If you are a victim of consumer fraud, law enforcement is here to help.  Contact your local district attorney, consumer affairs department, or the California Attorney General’s Office.

HELPFUL RESOURCES

• The Federal Trade Commission maintains a website full of resources for military consumers.
• Servicemembers in need of legal assistance should start by contacting their local JAG legal assistance office or the California National Guard legal assistance program.
• Veterans in need of legal assistance may want to start with LawHelpCa, a website with veteran-specific resources and links to legal aid organizations that offer FREE legal help. 
• Consumers can report predatory consumer activity targeting servicemembers, veterans, or anyone else, to the Office of the Attorney General.  To submit a complaint, please use one of the following forms:

English: https://oag.ca.gov/contact/consumer-complaint-against-business-or-company.

En Español: http://oag.ca.gov/sites/all/files/agweb/pdfs/contact/business_corpform_sp.pdf?

中文: http://oag.ca.gov/sites/all/files/agweb/pdfs/contact/business_corpform_chin.pdf?

Tiếng Việt: http://oag.ca.gov/sites/all/files/agweb/pdfs/contact/business_corpform_viet.pdf?

LOS ANGELES – Attorney General Kamala D. Harris today filed a lawsuit against Johnson & Johnson (J&J) for false advertising and deceptive marketing of its surgical mesh products for women.  The complaint alleges that J&J neglected to inform both patients and doctors of possible severe complications and misrepresented the frequency and severity of risks.

California co-led a multistate investigation, including 46 states and the District of Columbia, into J&J’s surgical mesh products for women, and is seeking injunctive relief and monetary penalties to ensure that J&J stops its deceptive practices.

“Johnson & Johnson put millions of women at risk of severe health problems by failing to provide critical information to doctors and patients about its surgical mesh products,” said Attorney General Harris. “Johnson & Johnson’s deception denied women the ability to make informed decisions about their health and well-being.  My office will continue to hold companies accountable for misleading consumers and patients for financial gain.”

The surgical mesh device is designed to treat common health conditions in women such as stress urinary incontinence and pelvic organ prolapse. The lawsuit alleges that J&J misrepresented the safety of these devices by concealing the possibility of serious and irreversible complications caused by mesh, including permanent pain with intercourse and/or loss of sexual function, chronic pain, permanent urinary or defecatory dysfunction, and potentially devastating impact on overall quality of life.  

J&J also misrepresented the severity and frequency of common complications, and failed to disclose that its surgical mesh devices presented risks not present in alternative treatment options.

The suit further claims that J&J knew about potential risks and side effects prior to the launch of their mesh products, yet omitted that information from educational and marketing materials provided to doctors and patients.  

J&J sold 787,232 devices nationally from 2008 to 2014, including more than 42,000 in California for that same time period.  Worldwide, more than 2 million women had been implanted with these mesh products. 

In addition to the lawsuit filed today, J&J faces over 35,000 personal injury lawsuits in state and federal court related to its surgical mesh products. 

A copy of the complaint is attached to the online version of this news release at www.oag.ca.gov/news.

SANTA BARBARA - Attorney General Kamala D. Harris and Santa Barbara County District Attorney Joyce E. Dudley today announced that Plains All-American Pipeline has been indicted by a grand jury on 46 criminal charges related to the May 2015 oil spill in Santa Barbara County.  A Plains All-American Pipeline employee was also indicted on 3 criminal charges.

On May 19, 2015, a pipeline operated by Plains All-American Pipeline ruptured, releasing into the environment approximately 140,000 gallons of heavy crude oil onto land, beaches, and the Pacific Ocean near Refugio State Beach.  Federal, state and local governments have spent millions of dollars to clean up the spill, which resulted in substantial damage to natural habitats and wildlife over a large area. 

Attorney General Harris partnered with local and state law enforcement agencies to conduct a criminal investigation and jointly prosecute the criminal case with Santa Barbara County District Attorney Dudley. 

“Crimes against our environment must be met with swift action and accountability,” said Attorney General Harris. “The carelessness of Plains All-American harmed hundreds of species and marine life off Refugio Beach. This conduct is criminal and today’s charges serve as a powerful reminder of the consequences that flow from jeopardizing the well-being of our ecosystems and public health.”

On May 16, 2016, a grand jury indicted Plains All-American Pipeline on 46 charges, including 4 felony charges and 42 misdemeanor charges. The company was charged with felony violations of state laws regarding the spilling of oil and hazardous substances into state water.  Both the company and James Buchanan, an employee, were charged with misdemeanor violations for failing to provide timely notice of the oil spill to the Office of Emergency Services.  In addition, the company was indicted on three dozen misdemeanor charges linked to the spill’s impact on birds and mammals.

“This indictment came as a result of many local and state agencies working together to present both inculpatory and exculpatory evidence to a hard-working Santa Barbara Grand Jury,” said District Attorney Dudley.  “The indictment is a response to the evidence presented and speaks to the alleged criminal culpability of both the corporation and an individual who are alleged to have caused harm to Santa Barbara County’s magnificent natural surroundings and death to some of it’s majestic wildlife.”

Plains All-American Pipeline faces up to $2.8 million in fines plus additional costs and penalties.

Attorney General Harris and District Attorney Dudley launched a joint criminal investigation 72 hours after the spill was discovered and in June, Attorney General Harris traveled to the site of the spill and met with command staff leading the cleanup and investigation.  More information is available here: https://oag.ca.gov/news/press-releases/photo-release-attorney-general-kamala-d-harris-tours-oil-spill-clean-refugio.

In 2011, Attorney General Kamala D. Harris joined federal, state, and local officials in securing a comprehensive settlement with the owners and operators of the M/V Cosco Busan over the major 2007 oil spill in the San Francisco Bay.  

LOS ANGELES — Attorney General Kamala D. Harris issued a consumer alert today to warn homeowners about mortgage loan modification scams.  The California Department of Justice has received an increased number of complaints from homeowners and has also been contacted by mortgage servicers that have expressed concern about these scams.

Scammers are calling and mailing homeowners, pretending to be their mortgage servicer or a representative from the Home Affordable Modification Program (HAMP), to offer fake loan modifications and “trial payment plans” to lower mortgage payments.  These scammers may send genuine-looking letters with the logo of the homeowner’s mortgage company, the homeowner’s account number, and deceptive contact information that routes homeowners to the scammers instead of their mortgage servicer.  They may also call from telephone numbers that show up on caller ID as the homeowner’s mortgage company. 

As with legitimate HAMP offers, homeowners are told that their loans may be permanently modified if they make three trial period payments and follow certain other requirements.  Homeowners are usually instructed to send payments via wire transfer or money order to sham addresses that supposedly belong to their mortgage company, only to later discover that they have been sending payments to scammers and have lost thousands of dollars while their real mortgage company has not received any payment during the duration of the scam. Currently, the federal HAMP and HARP programs are set to end on December 31, 2016.[1]

Other common mortgage modification scams include:

• Illegally charging homeowners upfront fees for mortgage modification services and then providing little or no assistance;

• Falsely guaranteeing or implying that modification applications will be approved (often through falsely claiming affiliation with HAMP, other government programs, or mortgage servicers); and

• Tricking homeowners into transferring part or all of their property interests to a scammer, usually in an effort to drain equity from a property.

Important Tips

Homeowners should keep the following tips in mind to protect themselves from mortgage modification scams:

• Be wary of unsolicited telephone calls and mailings that offer a mortgage modification or claim to be a pre-approved modification, especially if the homeowner is asked to provide any payment or personal information.
• Homeowners who have applied for a mortgage modification should confirm any modification offers or approvals directly with their mortgage servicer to ensure that the modification offer or approval is legitimate before paying money or providing personal information.
• Because scammers may provide fake contact information, homeowners should contact their mortgage servicer using the contact information on their regular mortgage statements to make sure that an offer or approval is legitimate.  If the offer or approval is for a HAMP modification, homeowners can also call the federal government’s Making Home Affordable hotline at 1‑888-995-HOPE (1-888-995-4673) to confirm that the offer is legitimate.
• Scammers often request payment by money transfer companies, including Western Union and MoneyGram, or wire transfer, and may also use a fake address for payments.  Before sending a mortgage payment to any address other than what is on the regular mortgage statements, homeowners should verify that the address is legitimate with their mortgage servicer.
• In California it is illegal for any person, including real estate agents, real estate brokers, and lawyers, to charge upfront fees for loan modification assistance or services.[2]  Be wary of any individual or company that guarantees a successful result, since only the mortgage servicer can approve a mortgage modification offer.  Homeowners should also be wary of any individuals who encourage homeowners to stop contacting their mortgage servicer or to stop making mortgage payments. 
• Homeowners should not have to pay a fee in order to apply for a mortgage modification and can get FREE help from a U.S. Department of Housing and Urban Development (HUD)-certified housing counselor to apply for a modification or other relief.  See Additional Resources below.

Additional Resources

• To check the legitimacy of a HAMP offer or approval, report a suspected scam, or to get free mortgage loan assistance, call the Making Home Affordable hotline at 1-888-995-HOPE (1-888-995-4673) or go to www.MakingHomeAffordable.gov.
• If a fake HAMP offer or approval is received, report it to the Office of the Special Inspector General for the Troubled Asset Relief Program at 1-877-SIG-2009 (1-877-744-2009) or go to www.sigtarp.gov.
• If a fake modification offer or approval is received by mail, report it to the United States Postal Inspection Service at 1-877-876-2455 or go to postalinspectors.uspis.gov.
• For a referral to a free housing counselor approved by the U.S. Department of Housing and Urban Development (HUD), call 1-800-569-4287 or go to www.hud.gov.
• For free assistance for low- and moderate-income Californians who want to stay in their homes and maintain an affordable mortgage, call Keep Your Home California at 1-888-954-KEEP (1-888-954-5337) or go to www.keepyourhomecalifornia.org. 

To submit a consumer complaint about a mortgage loan modification scam to the Office of the Attorney General, visit oag.ca.gov/contact/consumer-complaint-against-business-or-company.

[1] https://www.hmpadmin.com/portal/news/docs/2016/hampupdate030316.pdf, http://www.harp.gov/About

[2] See SB 94, passed in 2009, and 16 C.F.R. Part 322 

LOS ANGELES – Attorney General Kamala D. Harris today issued an information bulletin to California law enforcement agencies to reinforce integral eviction procedures under the California Homeowner Bill of Rights. Under current California law, occupants of a foreclosed property who are not named in eviction documents - such as tenants - can present a “Claim of Right to Possession” form to temporarily stop the eviction process up to and including when the Sheriff comes to remove them from the property.

Following the 2012 national mortgage settlement, Attorney General Harris sponsored the landmark California Homeowner Bill of Rights (HBOR), which took effect on January 1, 2013. The legislation package included additional protections for homeowners and tenants facing foreclosure. Although HBOR has been in effect since 2013, advocacy groups have reported cases in which Sheriffs proceed with the eviction process despite being presented with a Claim of Right to Possession form. This bulletin provides guidance for Sheriffs performing evictions following a foreclosure. 

“This bulletin clarifies integral protections and due process available under the Homeowner Bill of Rights,” said Attorney General Harris.  “I sponsored this bill to provide a fair process for vulnerable Californians who are facing the loss of their homes. I thank the advocacy organizations for their tireless work on behalf of those affected by the foreclosure crisis."

Prior to HBOR, occupants who were not named in an Unlawful Detainer Complaint were required to respond to a “Prejudgment Claim of Right to Possession” within 10 days of service. This is no longer the case.  Under HBOR, certain post-foreclosure occupants, such as tenants, can temporarily stop the eviction process by presenting a Claim of Right to Possession, including at the time of the lockout, to the Sheriff at the property. Once a claim is presented, the Sheriff should take no further action until notified by the court.  The bulletin further instructs Sheriffs on how to respond when presented with a Claim of Right to Possession. 

“HBOR provides critical protections for tenants in foreclosed properties.  Western Center on Law & Poverty is grateful to the Attorney General for providing guidance to the sheriffs who play a key role in implementing these protections and ensuring that innocent tenants will not be evicted without notice,” said Madeline S. Howard, Senior Staff Attorney at the Western Center on Law and Poverty. 

“Over 1 million California tenants suffered displacement after their landlords’ foreclosure from 2008-2012.  The tenant protections of HBOR helped address this crisis, and the Claim of Right to Possession gave tenants a new tool to assert their rights. However, many tenants have had difficulty using this procedure because it was new and education was limited.  Tenants Together believes that this Bulletin will significantly improve the use of the Claim of Right to Possession and ensure that Sheriffs across the state are able to properly follow the legal process,” said Leah Simon-Weisberg, Legal Director at Tenants Together. 

Western Center and Tenants Together have received calls asking for assistance with the prejudgment claim process and reports of post-foreclosure eviction abuse from tenants in the Central Valley, Inland Empire, and the San Francisco Bay Area. 

Attorney General Harris has worked to ensure that California’s homeowners are treated fairly and with consideration during the foreclosure process. In 2011, she created the Mortgage Fraud Strike Force, which was tasked with the responsibility to investigate and prosecute misconduct related to aspects of the mortgage process. In February 2012, Attorney General Harris secured more than $20 billion for struggling California homeowners from the nation’s five largest banks.

The Attorney General has also taken steps to improve relations between the public and law enforcement agencies. In 2015, she directed a review of her Division of Law Enforcement's policies on implicit bias and the use of force. Following the 90-day Review, Attorney General Harris created the first POST-certified course on Procedural Justice and Implicit Bias in the United States. In 2016, she sponsored legislation that would create a stand-alone course for peace officers on principled policing, procedural justice and implicit bias. She later formed the 21st Century Policing Working Group, which has convened several times to discuss its current progress and strategies to improve policing policies to fit the needs of today.   In addition, Attorney General Harris sent a bulletin to law enforcement making clear that federal immigration detainers are voluntary and that law enforcement agencies should direct resources in a manner that best serves their community.

LOS ANGELES – On Saturday, April 30, Attorney General Kamala D. Harris, AARP CA, and the District Office of Councilman Curren Price will hold Shred Fest 2016, a Los Angeles event where consumers can learn about how to prevent identity theft by shredding personal documents and other sensitive records for free. 

Saturday’s event is part of an ongoing partnership between AARP and Attorney General Harris’s office to protect consumers from identity theft and fraud and is one of several Shred Fest 2016 events scheduled for communities nationwide.  Shred Fest is also part of Money Smart Week®, supported by AARP’s Fraud Watch Network and the AARP Foundation.

“We must be vigilant in prosecuting those who take advantage of seniors and work to educate all Californians on how to avoid the increasing risks of identity theft, fraud and scams,” said Attorney General Harris. “‘Shred Fest 2016’ will help seniors safely dispose of sensitive documents and learn key strategies to protect themselves against identity theft.”

Information about Los Angeles Shred Fest 2016:

Saturday, April 30, 2016
4301 S. Central Avenue, Los Angeles, CA  90011
Shredding service begins at 10 a.m. and will continue until 2 p.m.

“Financial fraud causes millions of dollars in losses each year,” said Councilman Curren Price. “With the tax-filing season behind us, we’re encouraging taxpayers to do a spring cleaning of their old financial documents and other records.” 

“Identity thieves routinely search through dumpsters and trash cans, looking to find confidential information.  Our Shred Fest 2016 event will allow consumers to discard this paperwork in a safe and secure manner,” said Nancy McPherson, AARP CA State Director.

To avoid having your sensitive information compromised, security experts recommend shredding of the following types of materials:

• Old documents: Papers that carry your Social Security number, birth date, signature, account numbers, passwords or PIN numbers.
• Banking: Canceled or unused checks.  Shred deposit slips and ATM and credit card receipts, once you receive your monthly statements.
• Credit Cards: Preapproved credit card applications and incentive/gift checks from credit card companies.
• Medical: unneeded medical bills.
• Investments: Investment account statements.
• Obsolete ID cards: Expired driver’s licenses, medical insurance cards and passports.

Last year, Attorney General Harris partnered with AARP to protect seniors from fraud and abuse in a collaboration that includes tele-town halls and webinars to educate seniors, their families and the general public about legal protections designed for people age 50 and over. Together with the AARP Fraud Watch Network, Attorney General Harris’s office has created and disseminated consumer and educational resources to protect seniors against scams and schemes.

More resources to protect against identity theft are available on the Attorney General’s website at: http://oag.ca.gov/idtheft.

SACRAMENTO -- Attorney General Kamala D. Harris today announced her support for the Homeowner Survivor Bill of Rights, California Senate Bill 1150, legislation authored by Senators Mark Leno (D-San Francisco) and Cathleen Galgiani (D-Stockton).  The proposed bill would require companies that collect payments from borrowers—mortgage loan servicers— to communicate with the widowed spouses and survivors of homeowners to ensure that survivors receive accurate information about assuming responsibility for a mortgage and avoiding foreclosure. This legislation builds on Attorney General Harris’ work in 2011, when she secured $20 billion in relief for California homeowners.

“Following the devastating loss of a loved one, too many Californians also face the possibility of being stripped of their home. This proposed legislation requires mortgage servicers to communicate with spouses and children of deceased homeowners and gives them a fighting chance to stay in their homes,” said Attorney General Harris. “I thank Senators Leno and Galgiani for their efforts to extend critical financial and legal services to Californians facing unnecessary foreclosures.”

The proposed legislation would allow survivors or heirs to simultaneously apply for both loan assumption and loan modification and provide a single point of contact with the lender. The California Senate Banking Committee will hold a hearing on the legislation this afternoon.

“Instead of getting basic information on how to proceed with a home loan following the death of a loved one, surviving spouses and children face a labyrinth of paperwork and conflicting directions and requests, which only prolongs their grief,” said Senator Leno. “Many family members unnecessarily lose their homes without ever knowing they had the right to assume the loan or seek foreclosure remedies. Before more families give up, we must step in.”

"As California's senior population increases, so does this problem. Through its common-sense protections, SB 1150 would prevent additional, unnecessary, ‘red-tape foreclosures’ on widows, widowers, and other heirs,” said Kevin Stein, Associate Director at California Reinvestment Coalition.

In 2013, the Consumer Financial Protection Bureau issued guidance stating that “servicer[s] must have policies and procedures reasonably designed to ensure that, upon notification of the death of a borrower, the servicer promptly identifies and facilitates communication with a successor in interest of the deceased borrower with respect to the property that secures the deceased borrower’s mortgage loan.”  Despite this guidance, the California Department of Justice continues to receive reports that mortgage servicers are refusing or failing to communicate with widows and orphans of deceased homeowners.  SB 1150 would require servicers to communicate with successors and prevent families from facing unnecessary foreclosures after the deaths of their loved ones. 

In 2012, Attorney General Harris helped to enact the California Homeowner Bill of Rights (HBOR), a landmark package of laws establishing key mortgage and foreclosure protections to California homeowners and borrowers.  The laws, which took effect on January 1, 2013, restrict dual-track foreclosures, guarantee struggling homeowners a reliable point of contact at their lender, impose civil penalties on fraudulently signed mortgage documents, and require loan servicers to document their right to foreclose.  Dual-track foreclosures refer to a practice whereby a lender forecloses on a home while homeowners are simultaneously seeking a loan modification.

The California Homeowner Bill of Rights also extended the statute of limitations to prosecute mortgage fraud-related crimes to three years and allowed the Attorney General’s office to use statewide grand juries to investigate and indict the perpetrators of financial crimes involving victims in multiple counties.  For more information, see http://oag.ca.gov/hbor.

In May 2011, Attorney General Harris created a Mortgage Fraud Strike Force within the California Department of Justice to investigate and prosecute misconduct at all stages of the mortgage process and in February 2012, Attorney General Harris secured an unprecedented settlement with the nation’s five largest banks, securing $20 billion in relief for California homeowners.

SB 1150 is sponsored by the California Alliance for Retired Americans, Housing and Economic Rights Advocates and California Reinvestment Coalition.