Consumer Protection

SAN FRANCISCO - Attorney General Kamala D. Harris today announced that her office, along with the offices of seven other attorneys general, has reached settlements totaling $571 million with three manufacturers that engaged in price fixing of flat screen LCD (Liquid Crystal Display) panels found in monitors, laptops and televisions. 

The settlements announced today apply to Toshiba Corp.; LG Display Co., Ltd.; and AU Optronics Corporation (and several subsidiaries), which have collectively agreed to pay $543.5 million toward damages claims, plus $27.5 million in civil penalties.  This follows $538.5 million in settlements reached in December 2011 with seven leading LCD manufacturers, plus $14.7 million in civil penalties, bringing the total recovery to more than $1.1 billion, which will be divided among twenty-four states and the District of Columbia.

 “The price-fixing by these ten companies broke the law and short-changed California consumers,” said Attorney General Harris.  “This settlement brings justice to our consumers, protects companies that follow the law, and ends the pernicious practice of price-fixing by these manufacturers.”

In October 2010, the Attorney General's office filed a lawsuit against ten companies for engaging in price fixing of LCD panels from 1999 to 2006 that resulted in higher prices for California residents and businesses, as well as government agencies.

As part of the settlements, the ten companies that engaged in price fixing will provide a fund for injured consumers and businesses. The settling companies have also resolved claims brought by Attorney General Harris for civil penalties under California’s Unfair Competition Law, as well as restitution for government agencies that purchased products containing the flat screen LCD panels.

Attorney General Harris is joined in these settlements by the attorneys general of Arkansas, Florida, Michigan, Missouri, New York, West Virginia and Wisconsin, as well as a class action brought on behalf of private claimants in the United States District Court for the Northern District of California.

The three defendants who settled today join the seven who settled in December, which included Chimei Innolux Corp., Chi Mei Optoelectronics USA, Inc., Chi Mei Optoelectronics Japan Co., Ltd, HannStar Display Corporation, Hitachi, Ltd., Hitachi Displays, Ltd., Hitachi Electronic Devices, USA, Inc., Samsung Electronics, Co., Ltd., Samsung Electronics America, Inc., Samsung Semiconductor, Inc., Sharp Corporation, and Sharp Electronics Corporation.

The Attorney General’s case was originally filed in San Francisco Superior Court.

In 2008, two companies – LG Display Co., Ltd. and LG Display America, Inc. – pleaded guilty to federal charges for price fixing TFT-LCD panels and paid $400 million in federal fines. Defendants AU Optronics Corporation and AU Optronics Corporation America, along with several employees, were convicted on federal charges of price fixing in March 2012 in the United States District Court for the Northern District of California.

California consumers and government entities will receive a significant portion of the more than $1 billion settlements, with an exact percentage to be determined in coming months. Following completion of the litigation, California consumers and businesses can file claims for monetary relief. Information about how to file a claim will be available at the Attorney General's website or at www.lcdclass.com.

LOS ANGELES -- Attorney General Kamala D. Harris announced that the Homeowner Bill of Rights, which will protect homeowners and borrowers during the mortgage and foreclosure process, was signed into law today by Governor Edmund G. Brown Jr.

The Homeowner Bill of Rights prohibits a series of inherently unfair bank practices that have needlessly forced thousands of Californians into foreclosure. The law restricts dual-track foreclosures, where a lender forecloses on a borrower despite being in discussions over a loan modification to save the home. It also guarantees struggling homeowners a single point of contact at their lender with knowledge of their loan and direct access to decision makers, and imposes civil penalties on fraudulently signed mortgage documents.  In addition, homeowners may require loan servicers to document their right to foreclose.

The laws will go into effect on January 1, 2013, and borrowers can access courts to enforce their rights under this legislation.

The Homeowner Bill of Rights builds upon and extends reforms first negotiated in the recent national mortgage settlement between 49 states and leading lenders. Attorney General Harris secured up to $18 billion for California homeowners in that agreement, and has also built a Mortgage Fraud Strike Force to investigate crime and fraud associated with mortgages and foreclosures.

“The California Homeowner Bill of Rights will give struggling homeowners a fighting shot to keep their home,” said Attorney General Harris. “This legislation will make the mortgage and foreclosure process more fair and transparent, which will benefit homeowners, their community, and the housing market as a whole.”

“Californians should not have to suffer the abusive tactics of those who would push foreclosure behind the back of an unsuspecting homeowner,” said Governor Brown. “These new rules make the foreclosure process more transparent so that loan servicers cannot promise one thing while doing the exact opposite.”

The Homeowner Bill of Rights consists of a series of related bills, including two identical bills that were passed on July 2 by the state Senate and Assembly: AB 278 (Eng, Feuer, Pérez, Mitchell) and SB 900 (Leno, Evans, Corbett, DeSaulnier, Pavley, Steinberg).

The California Homeowner Bill of Rights also contains a variety of bills outside of the conference committee process. These will enhance law enforcement responses to mortgage and foreclosure-related crime, in part by empowering the Attorney General to call a grand jury in response to financial crimes spanning multiple jurisdictions. Additional elements will help communities fight blight related to foreclosure, and provide enhanced protections for tenants in foreclosed homes. Please see the attached fact sheet for the status of these bills.

The California Homeowner Bill of Rights was introduced February 29, 2012 at a press conference featuring Assembly Speaker John A. Pérez and Senate President pro Tem Darrell Steinberg and bill authors from the Assembly and Senate.

More details about the California Homeowner Bill of Rights are found on the attached fact sheet. To learn more about how the bills impact California homeowners, review the slideshow at: www.oag.ca.gov.

SACRAMENTO -- Attorney General Kamala D. Harris today announced that the non-conference committee components of the California Homeowner Bill of Rights have passed out of legislative committees.

“The entire Homeowner Bill of Rights legislative package will create a level playing field for California homeowners,” said Attorney General Harris. “In addition, it will allow my office to continue to prosecute those who take advantage of homeowners who are desperate to stay in their houses.”

Assembly Bill 1950, authored by Assemblymember Mike Davis (D-Los Angeles), passed out of the Senate Judiciary today. The bill extends the statute of limitations for prosecuting mortgage related crimes from one year to three years, giving the Department of Justice ample time to investigate and prosecute mortgage fraud crimes.

Two bills to provide additional protections to tenants who rent homes that are foreclosed upon also passed out of the Senate Judiciary and Assembly Judiciary Committees today.

Assembly Bill 2610 (Assemblymember Nancy Skinner, D-Berkeley) and Senate Bill 1473 (Senator Loni Hancock, D-Berkeley), will require purchasers of foreclosed homes to give tenants at least 90 days before starting eviction proceedings. If the tenant has a fixed-term lease, the new owner must honor the lease unless the owner demonstrates that certain exceptions intended to prevent fraudulent leases apply.

Also passing out of the Judiciary Committees were Assembly Bill 2314 (Assemblymember Wilmer Carter, D-Rialto) and Senate Bill 1472 (Senator Fran Pavley, D-Agoura Hills), which provide additional tools to local governments and receivers to fight blight caused by multiple vacant homes in neighborhoods.

The final component in the California Homeowner Bill of Rights, AB 1763 (Assemblymember Mike Davis, D-Los Angeles) and Senate Bill 1474 (Senator Loni Hancock, D-Berkeley), gives Attorney General Harris the ability to convene a special grand jury to investigate and indict the perpetrators of financial crimes involving victims in multiple counties. AB 1763 and SB 1474 passed out of the Senate Public Safety and Assembly Public Safety, respectively.

Two key parts of the Homeowner Bill of Rights passed Monday out of both houses of the Legislature and sent to Governor Jerry Brown. Those bills, which came out of a two-house conference committee, provide protections for borrowers and struggling homeowners, including a restriction on dual-track foreclosures, where a lender forecloses on a borrower despite being in discussions over a loan modification to save the home. The bills also guarantee struggling homeowners a single point of contact at their lender with knowledge of their loan and direct access to decision makers.

The California Homeowner Bill of Rights extends Attorney General Harris’ response to the state’s foreclosure and mortgage crisis. Attorney General Harris created a Mortgage Fraud Strike Force in March, 2011 to investigate and prosecute misconduct related to mortgages and foreclosures. In February 2012 Attorney General Harris extracted a commitment from the nation’s five largest banks to dedicate an estimated $18 billion to mitigate financial harm to California borrowers caused by bank misconduct in the foreclosure process.

For more information on the California Homeowner Bill of Rights, go to www.oag.ca.gov

SACRAMENTO -- Attorney General Kamala D. Harris announced the California Homeowner Bill of Rights is one step closer to becoming law after key provisions passed the California Legislature today. The bills, which provide first of their kind protections for homeowners and reforms to the mortgage and foreclosure process, will now be sent to the desk of Governor Jerry Brown for consideration. The bills were approved 53 to 25 in the Assembly and 25 to 13 in the Senate.

“Passing these key elements of Homeowner Bill of Rights represents a significant step forward for struggling homeowners,” said Attorney General Harris. “These common-sense reforms will require banks to treat California homeowners more fairly and bring more transparency and accountability to their practices in our state. Responsible homeowners will have a better shot to keep their homes.”

“Californians will finally have a fighting chance to keep their homes, as this measure brings fairness to the loan modification and foreclosure process,” said Senate President pro Tem Darrell Steinberg. “At the same time, the protection gained by homeowners will help stabilize the housing sector of our economy. I applaud my colleagues for their hard work to protect consumers through this reasoned compromise.”

“The package approved by the Legislature today is a major victory for California’s consumers,” said Assembly Speaker John A. Pérez. “We impose tough new regulations on banks and lenders to stop the abusive practices we’ve seen since the collapse of the housing market, and this package will bring relief to hundreds of thousands of California homeowners.”

The California Homeowner Bill of Rights consists of a series of related bills, including two that were passed on June 26 by a two-house conference committee: AB 278 (Eng, Feuer, Pérez, Mitchell) and SB 900 (Leno, Evans, Corbett, DeSaulnier, Pavley, Steinberg). 

The two identical bills passed by the conference committee contain key elements of the legislative package and provide protections for borrowers and struggling homeowners, including a restriction on dual-track foreclosures, where a lender forecloses on a borrower despite being in discussions over a loan modification to save the home. The bills also guarantee struggling homeowners a single point of contact at their lender with knowledge of their loan and direct access to decision makers. For the first time, the Homeowner Bill of Rights imposes civil penalties, of up to $7,500, on the repeated filing of foreclosure documents without verifying their accuracy, a practice commonly known as “robo-signing.” In addition, homeowners may require loan servicers to document their right to foreclose.

Homeowners will also have a clearly-defined right to access the courts to protect themselves from violations of these protections.

The Homeowner Bill of Rights also consists of four bills outside of the conference committee process.  These will enhance law enforcement responses to mortgage and foreclosure-related crime, in part by empowering the Attorney General to call a grand jury in response to financial crimes spanning multiple jurisdictions. Additional elements will help communities fight blight related to foreclosure, and the crime that results, and provide enhanced protections for tenants in foreclosed homes. Please see the attached fact sheet for the status of these bills.

The California Homeowner Bill of Rights was introduced February 29, 2012 at a press conference featuring Assembly Speaker John A. Pérez and Senate President pro Tem Darrell Steinberg and bill authors from the Assembly and Senate. The Homeowner Bill of Rights codifies many of the core protections from the recent national mortgage settlement.

The California Homeowner Bill of Rights extends Attorney General Harris’ response to the state’s foreclosure and mortgage crisis. Attorney General Harris created a Mortgage Fraud Strike Force in March, 2011 to investigate and prosecute misconduct related to mortgages and foreclosures. In February 2012 Attorney General Harris extracted a commitment from the nation’s five largest banks to dedicate an estimated $18 billion to mitigate financial harm to California borrowers caused by bank misconduct in the foreclosure process.

More details about the California Homeowner Bill of Rights are found on the attached fact sheet. To learn more about how the bills impact California homeowners, review the slideshow at: www.oag.ca.gov.

SACRAMENTO -- Attorney General Kamala D. Harris today announced the passage of two central elements of the California Homeowner Bill of Rights through a special two-house conference committee. The 4 to 1 vote sends the bills to an expected vote next week in both the Assembly and Senate.

The two bills approved by the conference committee are the Foreclosure Reduction Act, which restricts the process of “dual-tracked” foreclosures and the Due Process Rights Act, which guarantees a reliable contact for struggling homeowners to discuss their loan with and which for the first time imposes civil penalties on the practice of fraudulently signing foreclosure documents without verifying their accuracy, a practice commonly known as “robo-signing.” The proposed legislation also includes meaningful enforcement for borrowers whose rights are violated.

The full Homeowner Bill of Rights includes additional provisions to reduce blight, ensure appropriate law enforcement response to mortgage fraud and crime, and protect tenants.  The bills containing these protections are also advancing through the Legislature.

“I am gratified by this vote, which represents one more step toward our goal of achieving a Homeowner Bill of Rights for California,” said Attorney General Harris. “The mortgage and foreclosure crisis in our state demands urgent efforts to help Californians keep their homes. The legislature will now have the opportunity to cast a vote on behalf of California’s struggling homeowners.”

The California Homeowner Bill of Rights was introduced February 29, 2012 at a press conference featuring Assembly Speaker John A. Perez and Senate President pro Tem Darrell Steinberg and bill authors from the Assembly and Senate. The goal of the Homeowner Bill of Rights is to take many of the mortgage reforms extracted from banks in a national mortgage settlement and write them into California law so they could apply to all mortgage-holders in the state.

“The mortgage and foreclosure abuse in California ends here,” said Noreen Evans (D-Santa Rosa), co-chair of the Joint Conference Committee. “This committee has passed historic legislation that codifies the
protections eligible homeowners deserve, while helping to stabilize the foreclosure crisis that has thwarted California’s economic recovery. The Legislature has studied, listened and engaged Californians and
industry to find a solution that is fair and effective to mitigate this crisis. I look forward to the full support of the Legislature and Governor in implementing this package.”

“This bill is the result of a long and difficult process in which we received input from all interested parties; including homeowners and the banks and found that foreclosures benefit no one,” said Assemblymember Mike Eng (D-Alhambra). “We ended such dubious practices as having a bank foreclose while a homeowner is in the process of modifying a loan and cut through confusion by making sure that there is a ‘single point of contact’ with mortgage servicers.  With half a million California homes at risk of foreclosure, this action was urgently needed.”

The California Homeowner Bill of Rights extends Attorney General Harris’ response to the state’s foreclosure and mortgage crisis. Attorney General Harris created a Mortgage Fraud Strike Force in March, 2011 to investigate and prosecute misconduct related to mortgages and foreclosures. In February 2012 Attorney General Harris extracted a commitment from the nation’s five largest banks of an estimated $18 billion for California borrowers.

More details about the California Homeowner Bill of Rights are found on the attached fact sheet.  To learn more about how the bills impact California homeowners, review the slideshow at: www.oag.ca.gov.

SAN FRANCISCO -- Attorney General Kamala D. Harris today announced that Facebook has become the seventh company to sign the Joint Statement of Principles to strengthen privacy protections for consumers around the world who use online applications on their smartphones, tablets and other electronic devices. The agreement extends the reach of California’s privacy protections beyond mobile apps to include social apps in Facebook’s App Center, which are used daily by millions of consumers. Among other protections, the agreement seeks to improve compliance with California law requiring apps that collect personal information to have a privacy policy.

“Consumers deserve to be able to make informed choices about how much personal information they want to share with others when using social apps,” said Attorney General Harris. “We are delighted that Facebook has joined Amazon, Apple, Google, Hewlett-Packard, Microsoft, and Research in Motion to provide consumers with greater control and information about how their personal data is used.  We need to protect privacy while we foster innovation.”

In a letter to Attorney General Harris released today, Facebook wrote “…we hope that you will consider us a signatory to the Joint Statement.” Facebook joins an agreement that was first announced in February when Amazon.com Inc., Apple Inc., Google Inc., Hewlett-Packard Company, Microsoft Corporation, and Research in Motion Limited all signed on to a Joint Statement of Principles. 

In the letter, Facebook’s Chief Privacy Officer Erin M. Egan wrote, “As you know, the Joint Statement’s principles embodied essential protections for Californians and others who use mobile apps by encouraging companies that provide mobile app markets to give developers the ability to provide a link to their privacy policies and to display those links along with other app details….As we built the App Center, we were guided by the principles contained in the Joint Statement.”

Starting in 2011, Attorney General Harris worked with Amazon, Apple, Google, Hewlett-Packard, Microsoft, and Research In Motion to forge the Joint Statement to ensure that emerging online technologies such as mobile apps comply with California’s Online Privacy Protection Act (Simitian, 2004).  The Act requires operators of commercial web sites and online services, including mobile and social apps, who collect personally identifiable information about Californians to conspicuously post a privacy policy.  The posting of a privacy policy promotes transparency and provides consumers with more informed control over their personal information. Today’s agreement recognizes the Facebook App Center’s role as a clearinghouse for a variety of social apps.

A letter from the Attorney General’s Office to Facebook said, “California law requires all operators of commercial web sites and online services, including mobile and social apps, who collect personally identifiable information about Californians to conspicuously post a privacy policy.  We are very pleased that Facebook has incorporated the Principles into the design of the App Center and that Facebook requires, as a condition of participating in the App Center, that developers submit a link to a privacy policy.  We are also pleased to see that Facebook is prominently displaying the link to an app’s privacy policy in the App Center, and is implementing a means to report and remediate privacy issues.”

In addition to signing the Joint Statement, Facebook will participate in a multi-stakeholder Advisory Group on Mobile Privacy Practices that the Attorney General’s Office and the California Office of Privacy Protection have convened to develop best practices for mobile privacy generally and to develop model mobile privacy policies in particular.

Copies of both letters are attached to the electronic version of this release at: http://oag.ca.gov/news

The February 2012 press release announcing the apps agreement can be found here: http://oag.ca.gov/news/press-releases/attorney-general-kamala-d-harris-secures-global-agreement-strengthen-privacy

LOS ANGELES --- California Attorney General Kamala D. Harris today announced the arrest of two individuals in a $1.3 million Ponzi scheme that targeted Latino investors, many of whom were seniors.

Edwin G. Salazar, 34, of Downey, CA and Michael Z. Zuniga, 41, of Fullerton, CA were arrested on 57 counts of elder abuse, grand theft and securities fraud. Salazar’s bail was set at $100,000 and Zuniga’s at $50,000.

“The defendants defrauded investors with promises of guaranteed returns and even convinced some victims to re-finance their own homes in order to participate in the scheme,” said Attorney General Harris. “What victims thought was a resourceful real estate investment only brought them losses and heartbreak.”

From January 2007 through June 2008, licensed insurance agents Salazar and Zuniga, doing business as OMEGA Investment Group, of Downey, CA, issued over $1.3 million in fraudulent securities to individual investors they befriended through their insurance business.

The case was investigated by Department of Justice Special Agent Debra Gard, along with the California Department of Insurance Los Angeles Investigation Division.

“These agents conspired to rip-off trusting members of their own community,” said Insurance Commissioner Dave Jones. “Preying on Senior Citizens for financial gain is deplorable and it will not go unpunished.”

The scheme targeted Latino investors, many of whom were seniors. Investors were promised that their investments were secure and “risk-free” because of the company's strong track record of buying and selling homes in foreclosure. Investors were guaranteed a return of 15 percent. In many cases, the defendants convinced investors to refinance their homes and take out money to invest in the foreclosed properties.

In fact, OMEGA had not been buying and selling foreclosed properties with the money, was never a profitable company, could not secure any funds raised, and diverted funds to other investments and to the personal uses of Salazar and Zuniga. As OMEGA continued raising and diverting money, it began to operate like a classic Ponzi scheme, paying interest to previous investors from capital raised from new ones.

Attorney General Harris formed a Mortgage Fraud Strike Force in May 2011 to investigate and prosecute crimes related to mortgages, foreclosures, and real estate.

This case is being prosecuted by Deputy Attorney General Ed Skelly.

SAN FRANCISCO -- Attorney General Kamala D. Harris and Sonoma County District Attorney Jill Ravitch today announced the arrest of a Petaluma man who stole more than $20 million from dozens of investors in a Ponzi scheme.

Aldo Joseph Baccala, 71, was charged with 167 felony counts of grand theft, securities fraud and elder abuse. He has also been charged with a number of enhancements, which indicate that he engaged in a pattern of theft and fraud related crimes which resulted in a loss of over $3.2 million. Baccala’s bail has been set at $2 million and he is being held at the Sonoma County Adult Detention Facility.

“This Ponzi scheme caused dozens of investors to lose their money through false promises and sham investments,” Attorney General Harris said. “It is important to protect Californians from criminals who use deceptive tactics for personal gain.”

“Through this joint prosecution effort, we intend to seek justice for Sonoma County residents who suffered tragic losses in a fraudulent scheme,” said District Attorney Ravitch.

The arrest declaration alleges Baccala used his Petaluma-based company, Baccala Realty, Inc., to raise millions of dollars from more than 50 investors for ventures in California and other states, such as assisted living facilities, a car wash and other businesses.

Victims of the scheme, many of whom are elderly and who had known Baccala and his family for many years were promised annual returns of 12 percent or more to invest in a specific project which was supposed to be secured by a first or second deed of trust on the property. In fact, none of the promised deeds of trust were ever recorded, and the funds raised were not used as promised.

Baccala also allegedly used money obtained by investors to invest in the stock market and to cover margin calls and stock trading losses. From 2003 to 2008, he lost approximately $8 million in the stock market. As his debts grew, he began promising new investors annual returns of up to 27.5 percent to cover interest payments to earlier investors.

In November 2008, Baccala issued letters to investors saying that he would no longer make promised monthly payments. After receiving numerous complaints, the Sonoma County District Attorney’s Office launched an investigation into Baccala Realty, Inc. in January 2009.

The Sonoma District Attorney’s office was assisted in the investigation by the Attorney General’s office, and the case will be jointly prosecuted.

Victims in this case may obtain more information at http://da.sonoma-county.org/content.aspx?sid=1023&id=2531

SACRAMENTO -- Attorney General Kamala D. Harris today announced two bills to help tenants who suddenly find themselves with the possibility of being displaced because of a foreclosure passed the Assembly and Senate. The bills are part of the Attorney General’s proposed California Homeowner Bill of Rights.

Assembly Bill 2610 (Assemblymember Nancy Skinner, D-Berkeley) and Senate Bill 1473 (Senator Loni Hancock, D-Berkeley) will require purchasers of foreclosed homes to give tenants at least 90 days before starting eviction proceedings.

“Tenants are unsuspecting victims in the mortgage and financial crisis,” said Attorney General Harris. “They pay rent on time but may suddenly find themselves forced to move. These bills will give tenants important rights and fair treatment when they live in a rental that is under threat of foreclosure.”

Under the bills, if the tenant has a fixed-term lease, the new owner must honor the lease unless the owner demonstrates that certain exceptions intended to prevent fraudulent leases apply.

Currently, there are incongruities within state law, and between state and federal law, regarding eviction proceedings following a foreclosure. AB 2610 and SB 1473 would correct these confusing laws. All provisions in the bill will remain in effect until December 31, 2019.

“Too often, California tenants are the unwitting victims when a home they are renting is foreclosed on,” said Senator Hancock. “The inconsistency between state and federal law has left renters confused and, at times, misled about their legal protections. This bill provides common sense solutions to help protect California citizens caught in the crossfire of the mortgage foreclosure crisis.”

“The mortgage crisis and resulting foreclosures have directly impacted more than 200,000 California renters in 2010 alone,” said Assemblymember Skinner. “The Renters’ Right Act of 2012 protects families in rental housing by providing basic protections and legal rights in the face of unjust foreclosure-related evictions.”

SB 1473 passed the Senate on a 25 to 13 vote and AB 2610 passed the Assembly on a 54 to 13 vote.

The bills are part of the California Homeowner Bill of Rights. Other portions of the package are being considered in a Joint Legislative Conference Committee, including elements to restrict unnecessary foreclosures and protect the due process rights of borrowers and homeowners.

The California Homeowner Bill of Rights also includes:

DUE PROCESS AND FORECLOSURE REDUCTION ACT: SB 900 (Leno) & AB 278 (Eng). These bills are being considered by a Joint Legislative Conference Committee.

BLIGHT PREVENTION LEGISLATION: AB 2314 (Carter) & SB 1472 (Pavley and DeSaulnier). These bills have passed the Assembly and Senate, respectively, and now will be heard in the other house.

GRAND JURY LEGISLATION: AB 1763 (Davis) & SB 1474 (Hancock). These bills have passed the Assembly and Senate, respectively, and will now be heard in the other house.

AG ENFORCEMENT LEGISLATION: AB 1950 (Davis). This bill passed the Assembly, and will now be heard in the Senate.

For more information on the California Homeowner Bill of Rights, go to www.oag.ca.gov

SACRAMENTO -- Attorney General Kamala D. Harris today announced the Assembly and Senate each passed important components of the California Homeowner Bill of Rights that will help protect homeowners from scams.

The bills enhance the Attorney General’s enforcement powers and allow the Attorney General to use special grand juries to prosecute multi-jurisdictional financial crimes. The Mortgage Fraud Strike Force established by the Attorney General has been investigating and prosecuting a wide range of crimes related to mortgages, foreclosures and real estate.

“California was the epicenter of the mortgage and foreclosure crisis and scammers have been preying on vulnerable citizens who simply want to keep their homes,” said Attorney General Harris. “These bills will aid our efforts to prosecute and convict these criminals.”

These are two of the six bills in the California Homeowner Bill of Rights. Other portions of the package are being considered in a Joint Legislative Conference Committee, including elements to restrict unnecessary foreclosures and protect the due process rights of borrowers and homeowners.

AB 1763 (Assemblymember Mike Davis, D-Los Angeles) and SB 1474 (Senator Loni Hancock, D-Berkeley) would allow the Attorney General to convene a special grand jury to investigate and indict the perpetrators of financial crimes involving victims in multiple jurisdictions. Both bills passed out of their respective houses unanimously with bipartisan support.

The special grand jury would convene in cases involving fraud or theft that occurs in more than one county and where all potential charges are against a single defendant or multiple defendants working together.

Crimes of a financial nature often occur in multiple jurisdictions. Under current law, crimes where the fraud victims are all over the state require separate grand juries and charges filed in each county where the defendant committed the crime. This legislation would provide for the option of a special grand jury that can investigate financial crimes beyond the scope of single-county grand juries.

“The Attorney General is currently engaged in the investigation of significant crimes,” Senator Hancock said. “Unfortunately, county-by-county grand juries do not work well in dealing with large-scale wrongdoing in multiple jurisdictions. With this bill, the Attorney General can investigate multijurisdictional crimes – it will provide protection when Californians need it the most.”

In addition, AB 1950, by Assemblymember Davis, will extend to three years the statute of limitations on mortgage related crimes. The current statute of limitations of one year can make it difficult to prosecute crimes such as the prohibition on charging up front fees for loan modification services. Because the foreclosure process is so protracted, some homeowners may not even realize that they have been the victim of a scam before it is too late for prosecution.

“AB 1950 equips the Attorney General to do her job; to go after the bad actors that have taken advantage of homeowners. It accomplishes this by providing the Attorney General with appropriate time to investigate and prosecute those who prey on California homeowners,” said Assemblymember Mike Davis. The bill passed out of the Assembly on a 46 to 18 vote.

The California Homeowner Bill of Rights also includes:

DUE PROCESS AND FORECLOSURE REDUCTION ACT: SB 900 (Leno) & AB 278 (Eng). These bills are being considered by a Joint Legislative Conference Committee.

BLIGHT PREVENTION LEGISLATION: AB 2314 (Carter) & SB 1472 (Pavley and DeSaulnier). These bills have passed the Assembly and Senate, respectively and now will be heard in the other house.

TENANT PROTECTION LEGISLATION: AB 2610 (Skinner) & SB 1473 (Hancock). These bills will be heard in the Assembly and Senate by the end of the week.

For more information on the California Homeowner Bill of Rights, go to www.oag.ca.gov