Consumer Protection

OAKLAND — California Attorney General Rob Bonta today issued a consumer alert following Governor Newsom’s declaration of a state of emergency for Butte County due to the Thompson Fire, which has burned 3,002 acres and forced the evacuation of thousands of residents. In today’s alert, Attorney General Bonta reminds all Californians that price gouging during a state of emergency is illegal under Penal Code Section 396. Californians who believe they have been the victim of price gouging should report it to their local authorities or to the Attorney General at oag.ca.gov/report. To view a list of all price gouging restrictions currently in effect as a result of proclamations by the Governor, please see here. 

“As the Thompson Fire forces evacuations across Butte County, I ask Californians to listen to communication from officials, care for your neighbors, and keep safe,” said Attorney General Bonta. “As Californians flee their homes, I want to be very clear: Price gouging during a state of emergency is illegal. This means that businesses and landlords cannot unlawfully raise the price of essential supplies, hotels, rental housing, and more. I urge all Californians to heed evacuation orders, lend a helping hand where they can, and report price gouging when they see it.”

California law generally prohibits charging a price that exceeds, by more than 10%, the price of an item before a state or local declaration of emergency. For any item a seller only began selling after an emergency declaration, the law generally prohibits charging a price that exceeds the seller's cost of the item by more than 50%. This law applies to those who sell food, emergency supplies, medical supplies, building materials, and gasoline. The law also applies to repair or reconstruction services, emergency cleanup services, certain transportation services, freight and storage services, hotel accommodations, and rental housing. Exceptions to this prohibition exist if, for example, the price of labor, goods, or materials has increased for the business. 

Violators of the price gouging statute are subject to criminal prosecution that can result in a one-year imprisonment in county jail and/or a fine of up to $10,000. Violators are also subject to civil enforcement actions including civil penalties of up to $2,500 per violation, injunctive relief, and mandatory restitution. The Attorney General and local district attorneys can enforce the statute. 

For additional information, please see DOJ's FAQs on price gouging here.

Good for consumers, honest businesses, and the marketplace as a whole  

OAKLAND — California Attorney General Rob Bonta today issued the following statement and information for consumers following Senate Bill 478 (SB 478) going into effect on July 1, 2024. SB 478 makes it illegal for businesses to advertise or list a price for a good or service that does not include all required fees or charges other than certain government taxes and shipping costs. Also known as the “Honest Pricing Law” or “Hidden Fees Statute,” SB 478 does not change what price a business can charge or what may be included in that cost, it simply requires that the price listed include all mandatory charges consumers will pay. 

Mandatory fees charged by restaurants, bars, and other select food vendors are exempted from SB 478’s requirements so long as the fee is clearly and conspicuously displayed on the menu (see SB 1524, effective June 29, 2024).

“From the beautiful cliffs and seaside towns of Mendocino, to the bustling beaches of San Diego, I, like many Californians, will explore and enjoy all our great state has to offer this summer. Only this year, Californians won't have to worry about hidden fees at check out," said Attorney General Bonta. “SB 478 ensures clear and honest communication with consumers, so we can make the financial choices that are best for us and our families. As the hidden fee law goes into effect, I want consumers to be aware of their rights and feel confident to advocate for the transparency SB 478 provides. We all win when laws are followed. This summer, enjoy California — without the hidden fees.”

Why Hidden Fees Are a Problem

According to 2018 data from Consumer Reports, at least 85% of Americans have experienced a hidden or unexpected fee for a service, and more than two-thirds of those surveyed in 2023 said they were paying more now in surprise charges than they did five years earlier. Consumer Reports noted that hidden fees can increase the price of live event tickets by as much as 30% to 40%. SB 478 has no effect on prices; the law does not ask businesses to charge less, the law does not require businesses to charge more. The Honest Pricing Law works to empower consumers by arming them with accurate information upfront, so that they can compare prices between merchants, and creates an equitable marketplace for businesses to compete. 

Enforcement of SB 478

The requirements of SB 478 can be enforced by our office, District Attorneys, certain City Attorneys, certain County Counsels, and, subject to the Consumer Legal Remedies Act’s existing notice process, through private litigation. Our office and our local counterparts exercise discretion when considering whether to pursue an investigation or enforcement action. This includes scenarios where a business has acted in good faith and made its best efforts to comply with the law, or has taken responsibility and provided restitution to any consumers who may have been harmed by an unintentional violation of the law.

What to Do if You Notice Hidden Fees

First and foremost, we encourage consumers who observe apparent violations to have a conversation with the business and encourage them to come into compliance. We expect most businesses to act in good faith and make their best efforts to comply with the law. Consumers, employees, and competitor businesses who observe apparent violations can bring potential violations to our attention by visiting oag.ca.gov/report. 

To learn more about SB 478, please visit our web page.  

FasTrak does not request payment by text with a link to a website

OAKLAND — California Attorney General Rob Bonta today issued a consumer alert following an uptick in text-based scams claiming consumers owe express lane or toll charges and asking for online payment. Attorney General Bonta urges Californians to not click on links in texts appearing to alert consumers to overdue toll charges. FasTrak, the electronic toll collection system used statewide in California, does not request payment by text with a link to a website. Today’s consumer alert includes tips on how to identify and avoid toll charge scams, and what to do if you become a victim of this fraudulent activity.

“Scammers are often quite literally in our pockets, just a text away. Text-based toll charge scams are on the rise and knowing what to look for is an important way to keep consumers safe against these tactics,” said Attorney General Bonta. “I urge Californians to take practical steps to guard against being victimized by scammers, including talking to friends and family who may be unaware of these dangers.”

Often these types of scams involve a text that tells you to click a link to pay “overdue toll charges” to avoid late fees. This is most likely not the tolling agency, but a scammer. Clicking the link can lead to a phishing attack, where the scammer tries to take your personal information — and even steal your identity. And if you pay, not only are you out the money, but the scammer now has your credit card number, too. 

 How to Spot and Avoid Toll Scams:

• Slow down. Don’t rush to click on links or respond to the text. Scammers want you to react quickly when they send you an unexpected text message, but it’s best to stop and check it out.
• Check with the tolling agency. If you’re worried the text is not legit, check with the state’s tolling agency. But use a phone number or website you know is real to do so — not the info from the text.
• Report unwanted text messages. Use your phone’s “report junk” option to report these unwanted texts to your messaging app or forward them to 7726 (SPAM).
• Don’t engage. Delete the message. Unwanted messages often lead to scams. Once you’ve checked it out and reported it, delete the text message. And don’t engage.
• Share this information with people you know. Everyone can be prepared to spot and avoid the scam.

If You Receive a Toll Scam Text:

• Delete any scam texts received. 
• File a complaint. File a complaint with the FBI, the Federal Trade Commission, and our office. Be sure to include the phone number from where the text originated and the website listed within the text.
• Check your account using the toll service’s legitimate website. You can find Bay Area FasTrak’s official website here. If you are in Southern California, please see here. For a comprehensive list of all tolling agencies in California, please see here. 
• Contact the toll service’s customer service phone number. You can reach FasTrak customer service at 877-229-8655. Alert the toll service to your experience. 
• Secure your personal information and financial accounts. If you clicked any link or provided your information, take efforts to secure your personal information and financial accounts. Dispute any unfamiliar charges.

For more information on scams, visit here. To report a text-based scam to the Attorney General, visit oag.ca.gov/contact/general-contact-form.

Another important action to protect kids’ online data

OAKLAND — California Attorney General Rob Bonta, along with Los Angeles City Attorney Hydee Feldstein Soto, announced a $500,000 settlement with Tilting Point Media LLC (Tilting Point) resolving allegations that the company violated the California Consumer Privacy Act (CCPA) and the federal Children’s Online Privacy Protection Act (COPPA) by collecting and sharing children’s data without parental consent in their popular mobile app game “SpongeBob: Krusty Cook-Off.” In addition to $500,000 in civil penalties, Tilting Point must comply with injunctive terms ensuring legal data collection and disclosure, including obtaining parental consent and diligence in configuring third-party software in their mobile games.

“Businesses have a legal obligation to protect kids’ data and to comply with important state and federal privacy laws designed to protect children online. Failing to do this puts our kids at risk, leaving them vulnerable to having their personal data collected, tracked, and sold,” said Attorney General Bonta. “As children spend an increasing amount of time online, both on websites and using mobile apps, we will use every enforcement tool to ensure compliance with the law and that companies exercise diligence with privacy law requirements. I thank the Los Angeles City Attorney’s Office for their work on this issue and look forward to continuing to work collaboratively with local, state, and federal partners to protect children’s privacy.”

“The “SpongeBob: Krusty Cook-Off” game is based on some of the most beloved and recognizable characters in children’s entertainment. Tilting Point Media is alleged to have collected and shared its young players' personal data, violating consumer privacy laws and industry guidelines,” said Hydee Feldstein Soto, Los Angeles City Attorney. “Protecting our children has been a top priority for my administration. I am proud to partner with Attorney General Bonta to protect children throughout our State and am grateful to the lawyers in the Public Rights Branch in my office for initiating this action to stop data harvesting of minors.” 

“SpongeBob: Krusty Cook-Off” (SpongeBob) is a popular cooking simulation game that includes both targeted advertising and in-app purchases and is directed to children under the age of 13 as well as targeted to older teens and adults. The app was first investigated by the Children’s Advertising Review Unit (CARU), a division of the Better Business Bureau National Programs that investigates potential deceptive or inappropriate data collection from children online. CARU found that the privacy and advertising practices of the SpongeBob app failed to comply with COPPA and CARU’s industry guidelines. Although Tilting Point took some corrective action, a joint investigation by the California Department of Justice and Los Angeles City Attorney’s Office found that Tilting Point was in violation of the CCPA and COPPA in connection with how the mobile app handled children’s data. Tilting Point’s age screen did not ask age in a neutral manner, meaning children were not encouraged to enter their age correctly to be directed to a child-version of the game. Additionally, Tilting Point inadvertently misconfigured third-party software development kits (SDKs), resulting in the collection and sale of kids’ data without parental consent.

In addition to paying $500,000 in civil penalties, Tilting Point media must comply with strong injunctive terms. Tilting Point must:

• Comply with the CCPA and COPPA related to children’s data in the SpongeBob game and all of its games directed to children.
• Not sell or share the personal information of consumers less than 13 years old without parental consent, and not sell or share the personal information of consumers at least 13 and less than 16 years old without the consumer’s affirmative “opt-in” consent.
• In instances where Tilting Point sells or shares the personal information of children, provide a just-in-time notice explaining what information is collected, the purpose, if the information will be sold or shared, and link to the privacy policy explaining the parental or opt-in consent required.
• Use only neutral age screens that encourage children to enter their age accurately.
• Appropriately configure third-party SDKs to comply with legal requirements related to children’s data.
• Implement and maintain a SDK governance framework to review the use and configuration of SDKs within its apps.
• Comply with laws and best practices related to advertising to minors, and minimize data collection and use from children.
• Implement and maintain a program to assess and monitor its compliance with the judgment, including annual reports to the California Department of Justice and Los Angeles City Attorney’s Office.

COPPA AND CCPA

COPPA is a federal law that requires operators of websites and online services that are either directed to children under 13, or that have actual knowledge that they are collecting personal information from children under 13, to provide notice to parents and obtain parental consent before collecting, using, or disclosing personal information from children. The CCPA is a landmark state law that secures increased privacy rights for California consumers, including the right to know how businesses collect, share, and disclose their personal information and the right to opt-out of the sale or sharing of their personal information. The CCPA imposes on businesses specific responsibilities related to children’s data, including requiring parental consent before selling or sharing personal information from children under 13 years old, and obtaining the consumer’s affirmative opt-in consent for users at least 13 and under 16 years old.  

Attorney General Bonta is committed to enforcing both COPPA and the CCPA to improve children's online safety. Today's settlement represents Attorney General Bonta's third enforcement action under the CCPA, and his continued priority to protect children online:

• In March, Attorney General Bonta joined a bipartisan multistate letter to the Federal Trade Commission proposing updates to regulations implementing COPPA and advocating for further clarity and specification for proposed rules. 
• In February, Attorney General Bonta announced a settlement with DoorDash, resolving allegations that the company violated the CCPA and COPPA, by selling California customers’ personal information without providing notice or an opportunity to opt out of that sale. 
• In January, Attorney General Bonta, Assemblymember Buffy Wicks, and Senator Nancy Skinner introduced the California Children’s Data Privacy Act (AB 1949), and the Protecting Our Kids from Social Media Addiction Act (SB 976), landmark legislation seeking to protect youth online. These two bills would, respectively, limit the harms associated with social media addiction and provide more robust protections for kids’ data privacy.
• In October 2023, Attorney General Bonta co-led a bipartisan coalition of 33 attorneys general in filing a federal lawsuit against Meta Platforms, alleging among other things, that Meta designed and deployed harmful features on Instagram and Facebook that addict children and teens to their mental and physical detriment. The lawsuit alleges that Meta violated federal and state laws, including COPPA, California's False Advertising Law, and California’s Unfair Competition Law.
• In 2022, Attorney General Bonta announced a settlement with Sephora, resolving allegations that the company violated the CCPA by failing to disclose to consumers that it was selling their personal information, and failing to process user requests to opt out of these sales. 

A copy of the complaint and the final judgment can be found here and here.

Helps promote financial marketplaces that are safe, transparent, and reliable 

OAKLAND — California Attorney General Rob Bonta this week, along with a coalition of attorneys general, sent a letter to the Consumer Financial Protection Bureau (CFPB) supporting a final rule to detect and deter corporate offenders that have broken consumer laws and are subject to federal, state, or local government or court orders. Under the rule nonbank entities that offer consumer financial products must inform the CFPB if they become subject to an order issued by a federal, state, or local regulator or a court related to violations of consumer protection laws. The CFPB will then make this information available to regulators, businesses, and the public through a searchable online registry.

“It’s an age-old adage, but it’s true. Knowledge is power. We cannot efficiently fight injustice — or stand up for those who are taken advantage of or harmed — when we do not have access to current information,” said Attorney General Bonta. “As technology and innovation grow, we must keep up with it. Creating a transparent and accessible registry where agencies and consumers alike can vet nonbank financial services companies is a step to holding those who break the law accountable. I thank the CFPB for this timely rule and look forward to having another tool in the toolbox to help protect the financial health of Californians.”

When a financial services company violates consumer protection laws, a government law enforcement or regulatory agency may take enforcement action against them. While this usually leads to the issuance of a public order by the court or the agency itself, there is not currently a common database that tracks all of these orders. The registry will help the CFPB and other law enforcement and regulatory agencies identify repeat offenders and recidivism trends. The registry will also assist investors, creditors, business partners, and members of the public conducting due diligence or research on financial firms bound by law enforcement orders. 

In the letter, the attorneys general applaud the rule and the access it gives consumers, government agencies, and market participants to identify companies that have engaged in deceptive or abusive conduct. The registry enhances the CFPB’s ability to deploy resources more efficiently and prioritize enforcement actions against repeat offenders or entities subject to orders. State attorneys general benefit from enhanced abilities to spot emerging problems and engage in early prevention efforts. By creating a registry, market participants will have a single place to identify instances of specific conduct that courts or agencies have previously determined to be unlawful, deceptive, unfair, or abusive, and to shape their own marketing and compliance efforts accordingly.

Attorney General Bonta is committed to ensuring Californian's financial marketplaces are safe and equitable. In February, Attorney General Bonta issued letters to banks and credit unions not subject to the Consumer Financial Protection Bureau’s supervision warning that overdraft and returned deposited item fees may violate California and federal laws. Some financial institutions charge up to $36 or more for each overdraft. California consumers paid an estimated $200 million in overdraft fees in 2022, with the financial burden disproportionately falling on low-income consumers and consumers of color. In January, Attorney General Bonta submitted a comment letter supporting a proposed rule that would expand the CFPB’s supervisory authority to cover non-traditional payment digital applications which are not subject to the same federal regulatory oversight as their traditional bank counterparts. This lack of federal oversight exposes millions of digital payment platform users to risks that can be higher for vulnerable consumers, including young or low-income individuals, who may not have ready access to traditional FDIC-insured bank-provided digital payment platforms.

In submitting the letter, Attorney General Bonta joins the attorneys general of New York, Colorado, Connecticut, Illinois, Maryland, Minnesota, Oregon, Pennsylvania, and Vermont.

A copy of the letter can be found here.

Reiterates the need for all landlords and property managers to comply with the Tenant Protection Act

OAKLAND — California Attorney General Rob Bonta today announced a settlement against two individual landlords and their property management company, Bosanek Enterpises (doing business as Heritage Property Management Services), to resolve allegations that they violated California’s Tenant Protection Act (TPA) by unlawfully evicting tenants in Marysville. Co-authored by Attorney General Bonta during his time as a state assemblymember, the TPA was signed into law by Governor Gavin Newsom in 2019. It created significant statewide protections for most tenants, including by limiting rent increases and prohibiting landlords from evicting tenants without just cause. Effective as of April 1, 2024, Senate Bill 567 (SB 567) strengthened the TPA’s protections, created new remedies for violations, and gave city attorneys and county counsel express authority to enforce the TPA directly. As part of today’s settlement, the defendants will pay a total of $40,500, including $36,500 in restitution to the three affected tenants, and be required to take specific actions to ensure compliance with the TPA. 

“Millions of Californians are struggling to keep a roof over their heads. Today’s settlement underscores my office’s ongoing commitment to protecting renters, and I want to thank California Rural Legal Assistance for providing assistance in this matter,” said Attorney General Bonta. “We will continue to investigate and pursue violations of the Tenant Protection Act when appropriate. I urge local enforcers, including city attorneys and county counsel throughout the state, to do the same.”  

After receiving a credible complaint from California Rural Legal Assistance about a potentially unlawful eviction, the California Department of Justice launched an investigation into the landlords and Heritage Property Management Services. The investigation revealed that one landlord issued a pretextual eviction notice, claiming just cause to evict because the landlord’s uncle intended to move into the unit. However, under the TPA, landlords cannot evict tenants to move in relatives other than those specified in the law (owner’s spouse, domestic partner, child, grandchild, parent, or grandparent), and an uncle is not a qualifying relative. Additionally, no relative ever moved in, and the unit was rented to a new tenant at a large increase from the original rental rate. 

The investigation also revealed that a second landlord, working with the same property management company, issued two eviction notices claiming just cause because the landlord was undertaking a “substantial remodel” of the units. To qualify as a substantial remodel that justifies eviction under the TPA, work must be the “replacement or substantial modification of any structural, electrical, plumbing, or mechanical system that requires a permit from a governmental agency,” or the abatement of hazardous materials, that requires the tenant to vacate the unit for at least 30 consecutive days to be performed safely. However, the remodeling work performed did not rise to the level required under the TPA to evict a tenant. The landlord subsequently substantially raised rents in the two affected units.  

Under today’s settlement, which remains subject to court approval, the defendants will:

• Pay $36,500 in restitution to the three affected tenants.
• Pay $4,000 in penalties.
• Be subject to injunctive terms designed to ensure that no misconduct recurs, including by imposing reporting and documentation obligations on all defendants and additionally requiring the property management company to train its employees on state rental housing laws and to take steps to ensure the adequacy of future no-fault evictions.

Attorney General Bonta is committed to enforcing the TPA. On February 28, 2024, he secured a settlement with two Bakersfield landlords and their property management company to resolve allegations that they violated the TPA and the Fair Employment Housing Act by unlawfully evicting tenants, raising rents, and discriminating against tenants based on their receipt of housing assistance benefits. On January 8, 2024, he secured a settlement with Invitation Homes to resolve allegations that the company violated the TPA and California’s price-gouging law by unlawfully increasing rents on approximately 1,900 homes. On June 14, 2023, he secured a settlement with Green Valley Corporation to resolve allegations that the company violated the TPA by issuing unlawful rent increases to several of its employee tenants and serving unlawful eviction notices to a subset of those tenants. On May 22, 2024, he issued an information bulletin to city attorneys and county counsel, notifying them of SB 567’s strengthened protections to the TPA and of their direct enforcement authority under the recently amended TPA. Earlier this year, he issued alerts advising California tenants, landlords, and property managers of their rights and obligations under state law. 

The Housing Justice Team at the California Department of Justice reminds Californians that they can send complaints or tips related to housing to housing@doj.ca.gov. Tenants who need legal help can find legal aid resources in their area at www.LawHelpCA.org. A copy of the complaints and proposed judgments for all three defendants are available here: 1a, 1b, 2a, 2b, 3a, 3b.

OAKLAND — California Attorney General Rob Bonta today, as part of a bipartisan coalition of 42 state attorneys general, announced a $700 million multistate settlement with Johnson & Johnson (J&J) resolving claims that the company violated consumer protection laws by misrepresenting the safety of its talc-based products. Specifically, J&J failed to disclose if asbestos was present in its talc products and that any asbestos present in the products is harmful and may lead to cancer. The proposed settlement, subject to court approval, bars J&J from resuming the manufacture, marketing, promotion, sale, and distribution of talc-based products. J&J stopped selling these products in the United States and Canada in 2020.

“Johnson & Johnson knew that it could not ensure the safety of its products for women and children and chose to prioritize profit over honesty. It's unacceptable, and for the people who were harmed, it's devastating,” said Attorney General Bonta. “Today and every day, I take pride in serving the people of California and holding those who compromise consumer safety accountable.”

Since 1992, J&J sold over 600 million talc products nationwide, marketed primarily as baby powder for infants and genital hygiene products for women. Talc products were marketed as safe and pure despite J&J knowing that it could not ensure the talc used in its powders was free of asbestos.

Long-standing studies have suggested a possible association between the use of powders containing talc in the genital area and the incidence of ovarian cancer. Both talc and asbestos are naturally occurring minerals that may be found in close proximity in the earth. The contamination of talc with asbestos is possible and at times, difficult to determine. Asbestos — a carcinogen that kills more than 12,000 people in the U.S. per year — is linked to diseases that are life threatening, or cause substantial pain and suffering, including mesothelioma, fibrosis, lung cancer, gastrointestinal cancer, as well as other lung disorders and diseases. There is no safe level of exposure to this highly toxic material.

In securing today’s settlement, Attorney General Bonta joins the attorneys general of Texas, Florida, North Carolina, Alabama, Alaska, Arizona, Arkansas, Colorado, Connecticut, Delaware, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Maine, Maryland, Massachusetts, Michigan, Minnesota, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New York, North Dakota, Ohio, Oklahoma, Oregon, Rhode Island, South Dakota, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, and the District of Columbia. 

Attorney General Bonta is committed to investigating and remedying harm to consumers affected by unlawful and deceptive business practices. In May, Attorney General Bonta announced a $10.25 million settlement with major U.S. wireless carriers resolving allegations that the carriers violated consumer protection laws by engaging in deceptive and misleading advertising. Also in May, Attorney General Bonta announced a settlement with Liberty Tax for running deceptive advertisements that misled consumers into thinking they were getting a free advance on their tax refund when they were actually taking out a high-cost loan.

A copy of the proposed stipulated judgment, subject to court approval, can be found here. 

Blackhawk Manufacturing, Glockstore, and MDX permanently prohibited from manufacturing or selling ghost guns in or into California

OAKLAND — California Attorney General Rob Bonta and San Francisco District Attorney Brooke Jenkins, who were assisted by volunteer counsel from Giffords Law Center to Prevent Gun Violence, and Keker, Van Nest & Peters, LLP, today announced that final judgments were entered against Blackhawk Manufacturing (Blackhawk), GS Performance LLC (Glockstore), and MDX Corporation (MDX) as part of a settlement with the companies. Pursuant to the judgments, the companies will be permanently prohibited from manufacturing or selling unserialized ghost gun kits and firearm precursor parts in California. Firearm precursor parts are items that may be easily converted into a frame or receiver of a firearm, or that are marketed as such. The companies will also pay civil penalties in the following amounts: $500,000 from Blackhawk, $120,000 from Glockstore, and $55,000 from MDX. The judgments resolve allegations that the companies violated California and federal law in their manufacturing, advertising, and sale of ghost gun kits and firearm precursor parts.  

“The manufacture and sale of ghost gun kits has created a largely chaotic industry that is a massive threat to public safety,” said Attorney General Rob Bonta. “As firearm-related deaths and injuries rise, we must look for upstream interventions that get to the crux of the gun violence epidemic. Getting these manufacturers and retailers to keep untraceable ghost guns off the market is a big win for public health and safety in California.”

“The influx of unlawful and untraceable ghost guns poses a serious public safety issue to residents of San Francisco and the State at large,” said District Attorney Brooke Jenkins. “This lawsuit should serve as a reminder that firearms laws must be followed, particularly with respect to the importation and sale of firearm precursor parts into California. I am pleased to have worked with Attorney General Bonta and our pro bono partners to achieve this important result and will not hesitate to take action in the future to enforce state and federal gun laws.” 

“This is huge for California and the national fight against ghost guns.These reckless ghost gun sellers were selling ghost gun kits to California consumers who could not lawfully assemble them. Keeping these untraceable guns out of the state will save lives," said Esther Sanchez-Gomez, Litigation Director, GIFFORDS Law Center. "We were proud to work with Attorney General Bonta, San Francisco District Attorney Jenkins, and Keker, Van Nest & Peters, LLP to secure this critical win for the people of California.”

“We are proud to work alongside Attorney General Bonta, District Attorney Jenkins, and the Giffords Law Center to help end the manufacture, distribution, and sale of ghost gun kits in California,” said Brook Dooley, a partner with the law firm Keker, Van Nest & Peters. “These manufacturers have circumvented California’s gun safety laws for far too long, helping to promote an alarming public safety crisis. The unchecked proliferation of ghost guns will no longer undermine the safety of our communities.”

Ghost gun kits, which commonly contain firearm precursor parts, pose a serious public safety threat. The kits can be used to self-assemble a fully functional weapon in less than 30 minutes and are typically sold without a serial number or background check. As a result, people legally prohibited from purchasing or possessing firearms could obtain ghost guns. The lack of serial numbers on these firearms also render them essentially untraceable, making them attractive to criminals and impeding law enforcement’s ability to prevent and solve crimes. According to data reported by the California Department of Justice, Bureau of Firearms, the number of ghost guns recovered by law enforcement in California increased by more than 49,000% from 2015 to 2021. 

The complaint, which was filed in 2021, alleges that the defendants violated California consumer protection laws, and state and federal laws governing firearms. According to the complaint, the defendants violated and undermined the federal Gun Control Act by selling ghost gun kits and firearm precursor parts that are not serialized and by failing to comply with point-of-sale requirements, including background checks and recordkeeping requirements. As alleged in the complaint, the defendants also violated California’s Unsafe Handgun Act by selling kits and firearm precursor parts that produce handguns that lack required safety features, and two of the defendants violated California’s Manufacture of Firearms Law by manufacturing unfinished frames and receivers without serializing them. The complaint further alleges that the defendants misled consumers about serialization, eligibility, and safety requirements for legally assembling a firearm under California law and falsely led them to believe that the firearms built from the defendants’ products were legal.

Under the terms of the judgments, Blackhawk, Glockstore, and MDX are each permanently prohibited from manufacturing or selling any unserialized firearm precursor parts in or into California. They are also prohibited from making any statements that falsely suggest it is legal to purchase, sell, assemble, or own ghost guns or firearm precursor parts in California. The companies must also prevent future violations of California’s firearms laws by training and educating employees and providing notices to customers.

Since the complaint was filed, California’s AB 1621 was passed in 2022, which made the sale of unserialized firearm precursor parts generally illegal in the state and has helped to stem the tide of ghost guns. These judgments hold the defendants accountable for their conduct prior to the enactment of AB 1621; they do so under longstanding federal and state laws governing firearms, unsafe handguns, and fair business practices, and reinforce the applicability of those laws to the ghost gun industry.

Attorney General Bonta is committed to keeping Californians safe and stands with partners throughout the state to continue tackling the issue of gun violence strategically and aggressively by:

• Defending California’s commonsense gun laws, including its assault weapons ban and restrictions on large-capacity magazines.
• Educating the public on gun violence prevention through the Office of Gun Violence Prevention, including through data reports issued by the office to provide a robust review of gun violence and gun-related domestic violence data in California and throughout the U.S. and to help guide policy and strategy discussions related to reducing gun violence.
• Drafting and implementing regulations defining firearm precursor parts and guiding the public on firearm precursor part identification.
• Advocating for gun laws including by sponsoring Assembly Bill 1594 to increase accountability for the firearm industry and supporting The Gun Violence Prevention and School Safety Act (AB 28) to make long-term investments in community-based gun violence prevention programs, school mental health, gun crime investigations, and victim services.
• Working to strengthen federal laws to protect the public from ghost guns.
• Seizing guns from prohibited persons in the  Armed and Prohibited Persons System, and through multiagency sweeps in the Bay Area and Los Angeles County, conducting operations targeting individuals attempting to illegally purchase guns, and collaborating with local law enforcement partners.
• Calling for an investigation into an ammunition plant that sells military grade ammunition to the public that is subsidized by the American taxpayer. 

A copy of the complaint is available here. A copy of the judgment as to Blackhawk is available here, and a copy of the judgment as to Glockstore and MDX can be found here.

OAKLAND — California Attorney General Rob Bonta issued a statement today after the U.S. Supreme Court overturned a Second Circuit Court of Appeals decision in Cantero v. Bank of America. The Supreme Court found that the lower court failed to apply the proper standard for evaluating whether a New York state law that requires mortgage lenders to pay a 2% minimum interest rate on funds held in mortgage escrow accounts is preempted by the National Bank Act as applied to national banks. The decision allows states to enforce state consumer financial protection laws against both state and national banks so long as the state law does not prevent or significantly interfere with the exercise of power by national banks.

“The 2008 financial crisis absolutely blindsided families and homeowners who thought they were in a safe and stable place. Today, the Supreme Court has rejected a sweeping rule that would have hindered the ability of states to protect consumers from financial exploitation and abusive lending,” said Attorney General Bonta. “I celebrate today’s news and remain committed to guarding and enforcing essential consumer protection laws, today and every day.”

The U.S. Supreme Court observed that the Court of Appeals’ categorical test was improper and contrary to the Dodd-Frank Act, and would preempt virtually all state laws that regulate national banks. Because the Court of Appeals in Cantero failed to evaluate the New York law under the proper standard, the Supreme Court remanded to the lower courts to evaluate whether New York’s law is preempted by federal law.

Like the New York law at issue in Cantero v. Bank of America, California law requires financial institutions, including banks, to pay at least 2% annual interest on funds deposited in mortgage escrow accounts. Funds in an escrow account can be used by lenders to ensure timely payment of property taxes and insurance. These state minimum escrow interest laws are a simple and important consumer protection. Before the escrow interest laws were enacted, some lenders would collect significantly more in escrow than was needed to timely pay taxes and insurance, and would not pay any interest to the borrower, giving the lender essentially an interest-free loan at the borrower’s expense. The minimum escrow interest laws help ensure that borrowers are treated fairly, and reduce the incentive for lenders to collect excessive funds in escrow. At least 13 other states have similar laws in place to protect consumers.

In December 2023, Attorney General Bonta joined a bipartisan multistate coalition of attorneys general in submitting an amicus brief to the U.S. Supreme Court defending states’ rights to enforce state consumer financial protection in this case.

A copy of the amicus brief previously filed by Attorney General Bonta in this case is available here. A copy of the U.S. Supreme Court’s decision is available here.

OAKLAND — California Attorney General Rob Bonta today issued a consumer alert warning Californians to beware of scams that use artificial intelligence (AI) or “deepfakes” to impersonate government officials, distressed family members, or other trusted figures.

“Scammers are often quite literally in our pockets, just a phone call, social media message, or text away,” said Attorney General Bonta. “AI and other novel and evolving technologies can make scams harder to spot. Knowing what to look for is an important way to keep consumers safe against these tactics. I urge Californians to take practical steps to guard against being victimized by scammers, including talking to friends and family who may be unaware of these dangers.”

New technology – such as AI and deep fake video or voice manipulation – makes it easier for scammers to create sophisticated impersonations and to make more convincing requests for money or personal information. Scammers can use information available on the internet, including images and audio from social media, to convince people that the voice on the other end of the call is someone they can trust. Bad actors can clone a person’s voice through AI technology using clips of audio taken from that person’s social media account(s) and can refer to personal information about the victim found on the internet, making the scam appear credible.

For example, a troubling new scam targets parents by sending them AI voice impersonations of their child begging for help. Recent reports have included parents receiving a phone call using the cloned voice of their child claiming to have been badly injured in a car accident or in need of money to pay bail. Grandparents are often the target of scams claiming that their grandchild is in trouble and in need of money. In 2023, the FBI received victim complaints regarding grandparent scams that resulted in nearly $1.9 million in losses. 

Scammers often target consumers on their phones. In 2023, robocalls and robotexts resulted in more than $1.2 billion in reported losses nationwide. And most other methods of contact by scammers – including email, social media, and the internet – are also accessible by smartphones. These phone-based scams are designed to steal money, identities, or passwords, or urgently demand payment through cash or gift cards. Scams can result in significant financial losses, ruined credit scores, and impacted security clearance for service members and others. 

While younger adults reported losing money to fraud more often in 2023 than older adults, older adults who lose money tend to lose larger amounts.

Imposter scams were the most commonly reported fraud in 2023. These imposter scams often involve a bad actor pretending to be a bank’s fraud department, the government, a well-known business, a technical support expert, or a distressed relative, such as a kidnapped child. Other common phone-based scams include calls related to medical needs and prescriptions, debt reduction, utilities, bank fraud warnings, warranties, or IRS notices.

These scams can also spread misinformation about elections or political candidates. For example, in January residents of New Hampshire received scam election robocalls that allegedly used AI to impersonate the president and discourage voters from participating in the New Hampshire primary.

Protect Yourself and Others from Phone-Based Scams

Here are some tips to protect you and those you know from phone-based scams.

• Develop family code words: Develop simple ways of verifying if a family member truly is in trouble before responding to phone calls for financial help or sharing personal information. Talk with family about designating “safe words” or asking a question that only that person would know the answer to. When creating a question, be mindful that scammers might have access to information from social media and other online sources.
• Minimize personal audio/video content on social media accounts: Consider removing personal phone numbers and audio and video clips from your and your children’s social media profiles. AI scammers can use these clips to create clone voices and videos of loved ones.
• Check privacy settings: Strengthen privacy settings on social media so that strangers don’t know facts about your life and your current whereabouts, including whether you or a family member is out of town.
• Don’t answer the phone: Let phone calls from unfamiliar numbers go to voicemail. They often are illegal robocalls.
• Don’t trust caller ID: Phone numbers can be “spoofed” to look like a familiar number from friends, family, a school district, or a government agency. Don’t assume the caller ID is accurate and be wary if anything seems different about the caller or if they ask for financial or personal information.
• Hang up the phone: If you suspect a scam call, immediately hang up. Don’t automatically trust automated messages: often pressing “1” to indicate you don’t want to receive future calls just notifies bad actors that they should continue calling this active phone number.
• Take advantage of call-blocking technology: Many cellular providers offer enhanced call-blocking technology that can assist in preventing robocalls from reaching you.
• Don’t click on suspicious links: Scammers will try to get you to click on links that are sent to you in texts, emails, or social media. Text messaging is particularly dangerous because you might hurriedly click on a link and begin entering a password, not realizing that the link is phony, and your password is being recorded.
• Go directly to websites: Go directly to the website of a company you are familiar with rather than clicking on a link that has been sent to you. Some fraudulent links are made to look very similar to the actual website address. You should never click on links that are texted to you – for example, by what seems like a bank. Instead, go to the bank’s website on your own internet browser.
• Use strong passwords: Protect yourself by using different, unique passwords for each of your online accounts. Make sure that the passwords you use are at least eight characters, including a mix of letters, numbers, and symbols. Consider using a password manager to provide suggestions and store strong passwords.
• Protect your Social Security number (SSN) and other sensitive information: Keep your Social Security card at home in a safe place instead of carrying it around in your wallet. Only provide your SSN when absolutely necessary, such as on tax forms or employment records. If a business asks you for your SSN, see if there is another number that can be used instead.
• Beware of government impersonations and other common scams: Some scammers are sophisticated. They may offer to provide “documentation” or “evidence,” or use the name of a real government official or agency to make you think that their calls are legitimate. If a government agency calls you and asks for financial or personal information, hang up and go to the agency’s official website (which should be a .gov website) and call them directly. Government officials will not threaten you with arrest or legal action in exchange for immediate payment. They will not promise to increase your benefits or resolve an issue in exchange for a fee or transfer of funds to a protected account. And they will not ask for payment in the form of gift cards, prepaid debit cards, wire transfer, internet currency, or by mailing cash.

Attorney General Bonta is committed to protecting Californians by cracking down on robocalls, including AI-generated robocalls and robotexts.

In January, Attorney General Bonta called on the FCC to address the threat of AI-generated robocalls, and the FCC subsequently declared voice-cloning technology used in common robocall scams illegal under the Telephone Consumer Protection Act. In February, Attorney General Bonta joined a coalition of 51 bipartisan attorneys general in issuing a warning letter to a company that allegedly sent New Hampshire residents scam election robocalls during the New Hampshire primary election. The calls allegedly used AI to impersonate the president and discourage voters from participating in the primary. 

In May 2023, Attorney General Bonta, as part of a bipartisan coalition of 49 attorneys general, announced a lawsuit against Avid Telecom for allegedly initiating and facilitating billions of unlawful robocalls that included Social Security Administration scams, Medicare scams, and employment scams. In January 2022, as part of a bipartisan multistate coalition, Attorney General Bonta urged the FCC to stop the flood of illegal foreign-based robocalls that “spoof” U.S. phone numbers. In August 2022, Attorney General Bonta announced the launch of a bipartisan nationwide Anti-Robocall Litigation Task Force to investigate and take legal action against the telecommunications companies responsible for bringing a majority of foreign robocalls into the U.S.

For more information and resources on phone-based scams, visit our website at oag.ca.gov/consumers.