Consumer Alerts

OAKLAND — California Attorney General Rob Bonta today issued a consumer alert warning Californians of counterfeit tickets for the 2028 Los Angeles Olympic Games and related scams. In today’s alert, Attorney General Bonta reminds Californians to exercise caution in their online transactions and provides tips to avoid falling victim to ticket scams.  

“Californians are excited to welcome the world to the Olympic Games in Los Angeles in 2028. Being a host city presents an opportunity for Californians to be part of this amazing and infrequent world wide event,” said Attorney General Bonta. “Today, I remind Californians to be cautious around Olympic ticket sales, purchase only from authorized vendors, and protect their personal information. Remember, if it sounds too good to be true, it probably is. If you have fallen victim to a scam or suspect fraudulent activity, submit a complaint. You can file a report with my office at oag.ca.gov/report as well as with the Better Business Bureau and the FBI’s Internet Crime Complaint Center.” 

Protect Yourself from Ticket Scams: 

• Purchase tickets from authorized vendors: When possible, always purchase tickets directly from official websites to ensure authenticity.
• Know the refund policy: Before purchasing third-party resale tickets, look into the reseller’s refund policy and whether they offer a guarantee regarding the authenticity and timely arrival of tickets.
• Protect your personal information: Never provide personal information, such as your Social Security number or bank account number, to prevent financial loss and fraud.
• Verify the web address safety: Double-check the website URL by ensuring the link starts with “https://” and has a padlock icon to ensure your credit card and billing information remain safe.
• Do your research: Search for online reviews of the seller and any potential customer complaints for prior scams.
• Use secure payment methods: Consider using your credit card to ensure that you have an opportunity to dispute fraudulent charges. Avoid using instant payment platforms like Zelle, Venmo, and Cash App, or you could risk never getting your money back. Do not pay for tickets with gift cards, prepaid debit cards, wire transfers, or cryptocurrency. Demands for payment using those methods are a strong warning sign of a scam.
• Be wary of overly discounted tickets: Be extra cautious with low-priced and/or hard-to-get tickets. If the price seems too good to be true, it probably is. 

If consumers have fallen victim to a ticket scam, they can file a complaint with our office at oag.ca.gov/report. Consumers can also report the incident to the Better Business Bureau and the FBI’s Internet Crime Complaint Center.

If it’s too fast, it’s not an e-bike — you might be riding illegally 

OAKLAND — California Attorney General Rob Bonta, together with Marin County District Attorney Lori Frugoli, San Francisco District Attorney Brooke Jenkins, and San Mateo County District Attorney Steve Wagstaffe today issued a consumer alert to remind manufacturers, retailers, consumers, and parents that California has important safety laws regarding the sale and use of electric bicycles, also known as e-bikes. Two-wheeled vehicles that go over 28 miles per hour with pedal assistance or 20 miles per hour with throttle assistance are not e-bikes — under California law, they are mopeds or motorcycles and require additional licensing and age requirements to operate and sell. Importantly, modifying an e-bike to exceed the speed or power limits mentioned above is dangerous, may transform the e-bike into a motorcycle or moped under California law, and may be a crime if riders do not have appropriate licenses.  

“Sometimes, what looks like an e-bike or is marketed as an e-bike is not a bike at all. We are seeing a surge of safety incidents on our sidewalks, parks, and streets. Bike riders and parents: If your or your teen's electric two-wheeled vehicle goes too fast, it might be a motorcycle or a moped — not an e-bike,” said Attorney General Rob Bonta. “To ride a motorcycle or moped, you need to have the appropriate driver’s license and comply with rules of the road. With the popularity of e-bikes booming, I highly encourage manufacturers, retailers, and especially parents to review the consumer alert today and ensure they and their kids are complying with California law.” 

“I’m proud of the actions Marin’s community leaders, schools, and cities have already taken to improve e-bike safety,” said Marin County District Attorney Lori Frugoli. “But to keep everyone safe while enjoying our shared streets, trails, and open spaces, we must make sure that products marketed and sold as e-bikes are truly legitimate e-bikes — not electric motorcycles.” 

“Electric bicycles can be an economical, enjoyable, and convenient way to get around,” said San Francisco District Attorney Brooke Jenkins. “Unfortunately, many retailers are marketing and selling two-wheeled vehicles as ‘e-bikes’ when they do not qualify as electric bicycles in California. Consumers, and especially parents of teenage children, should carefully check that the product they want to purchase legally qualifies as an electric bicycle. If not, it may actually be a motorcycle (or motorcycle equivalent), which requires a license, registration and insurance. This is a matter of both consumer protection and public safety.”

“Legally operated e-bikes can be a fun and environmentally friendly transportation option," said San Mateo District Attorney Steve Wagstaffe. “However, San Mateo County has seen many illegal motorcycles and mopeds which are marketed and sold as e-bikes. The safety of our communities requires manufacturers, sellers, and buyers, including parents, to know and comply with California’s e-bike laws.”

All About E-Bikes:

Bicycles, including e-bikes, are part of California’s commitment to alternative forms of transportation that reduce reliance on fossil fuels. 

E-bikes are bicycles equipped with an electric motor that provide power assistance while pedaling, with some models featuring a throttle which can allow riders to power their e-bike without pedaling. They make cycling faster, easier, and more accessible by reducing effort. E-bikes can expand access to California’s roads, open spaces, and trails, offer transportation options to riders with reduced mobility, and are less expensive to purchase and maintain than cars.

However, because of their higher speeds, e-bikes can pose a dangerous risk, especially if they are modified to go faster, transforming them into motorcycles or mopeds. A study by the University of California, San Francisco found that rider injuries from e-bikes nearly doubled each year from 2017 to 2022, and a University of California, San Diego study showed injuries in San Diego among e-bike riders under 18 soared by 300% from 2019 to 2023.

E-bikes fall into three classifications: 

• Class 1, also known as low-speed pedal-assisted e-bikes, provide assistance only while being pedaled and only at speeds under 20 miles an hour.
• Class 2, also known as low-speed throttle-assisted e-bikes, provide power assistance up to 20 mph but have a throttle that allows the rider to engage the motor without pedaling.
• Class 3, also known as speed pedal-assisted electric bicycles, are like Class 1 bicycles except that the motor assistance must stop when the bicycle reaches the speed of 28 miles per hour.

All e-bikes sold in California must have a permanent label that discloses the bike’s classification number, identifies the e-bike’s top assisted speed and the wattage of its motor.  

While people of all ages may ride Class 1 or Class 2 e-bikes, Class 3 e-bikes may only be ridden by people who are 16 years old or older and who are wearing helmets. Cities, counties, and other local governments including schools and parks districts may have additional rules and ordinances regarding where and how e-bikes can be ridden.  

NOT all two-wheeled vehicles with electric motors are considered e-bikes under California law. If a two-wheeled vehicle with an electric motor has any of the features mentioned below, it may require registration with the California Department of Motor Vehicles (DMV) and proper licensing:

• Provides pedal assistance beyond 28 miles per hour;
• Provides throttle assistance beyond 20 miles per hour; 
• Has a motor with more than 750 watts of power; or
• Does not have operable pedals.

For Retailers:

Sellers may only advertise or sell vehicles as “e-bikes” if they fall within one of the three classes listed above. Sellers must also not advertise or sell as “e-bikes” vehicles that are intended to be modified to exceed applicable limits. Misrepresenting the characteristics of a bicycle or other vehicle, converting one for illegal use, or selling one without the required DMV occupational licenses is a crime. The DMV has specific requirements for dealer and salesperson licensing.   

For Parents: 

Attorney General Bonta and the District Attorneys encourage all parents to carefully ensure any bicycle or e-bike that they are purchasing for their children is safe and legal for their children to ride. Children under 16 may only ride Class 1 or Class 2 e-bikes. Class 3 e-bikes may only be ridden by people who are 16 years old or older and who are wearing helmets.  

If a vehicle does not qualify as an e-bike, because it lacks pedals or exceeds the power or speed thresholds mentioned above, it may be considered a motorcycle or moped under California law. In that event, the owner or operator must observe all requirements that pertain to those vehicles, including possession of an M1 or M2 operator’s license, adequate insurance, and registration with the DMV.

Parents should also be aware that some school districts have rules regarding bicycles, including rules that restrict unsafe and overpowered bicycles from campus grounds. Modifying an e-bike to exceed the speed or power limits mentioned above is dangerous, may transform the e-bike into a motorcycle or moped under California law, and may be a crime if riders lack the appropriate DMV licenses (available only to people 16 years old or older). 

If an investment seems too good to be true, it probably is 

OAKLAND — Attorney General Rob Bonta today issued an alert warning Californians about the prevalence of fraudulent investment scams across Meta platforms, including on Facebook, Instagram, and WhatsApp, as well as on other online platforms. Scammers are increasingly using deceptive advertisements (ads) and deepfake technology to lure people into high-stakes scams in order to then defraud them of their savings. Last year, Attorney General Bonta sent a letter to Meta urging the company to adopt protocols to properly tackle this pervasive issue — or otherwise ban all investment ads on its platforms. Attorney General Bonta encourages anyone who may have been a victim of these types of scams to report it to oag.ca.gov/report.

“Californians, we’ve seen an uptick in investment scams across Facebook, Instagram, and WhatsApp. These scams have cost some people their life savings and typically use photos of well-known or trusted people without their permission in order to create the necessary trust to get into consumers’ pockets,” said Attorney General Bonta. “I encourage Californians to learn about common scams and review tips to protect themselves, and I urge investors to scrutinize social media investment ads before investing.”

COMMON SOCIAL MEDIA INVESTMENT SCAMS

The Pump and Dump Scam:

In a pump and dump scheme, victims are lured into online investment groups and convinced to invest in low-priced stocks or deal in volatile cryptocurrencies. The scammers advertise, hype, and recommend buying the stocks or cryptocurrencies, increasing their prices, and then sell when the price is high, while the victims lose their money. These schemes typically follow a three-step process:

1. The Bait: Scam ads appear on Facebook or Instagram featuring recognizable figures, like Cathie Wood (Ark Invest), Joe Kernen (CNBC), or Kevin O’Leary (Shark Tank), without their permission. Other ads may feature less well-known financial advisors, also without their permission, especially those trusted by members of specific cultural or geographic communities. The ads often promise exclusive “insider” memberships or “guaranteed” high-return investment tips.
2. The Shift: Once a user clicks the ad, they are pressured to move the conversation to WhatsApp or other encrypted platforms such as Telegram. 
3. The Hook: Victims are funneled into group chats where they receive so-called “expert” advice and false testimonials. Eventually, victims are coerced into buying stocks or crypto, with the initial fraudulent tips sometimes appearing successful and generating a profit. Victims are convinced to spend large amounts in a stock or cryptocurrency, which then goes up in price and which the scammers sell off at this inflated price, leaving the victims to lose their money once the price plummets.

The Confidence Scam:

In confidence scams, fraudsters develop trusting relationships with their victims and convince them to “invest” using fake investment platforms that drain the victims’ money. These scams can also follow a three-step process:

1. The Bait: Scammers post ads suggesting that investors can make money using an investment platform or strategy. Once the user clicks on an ad, they may be asked to enter their contact information or taken to a different website to do so.
2. The Investment: After the user provides their account information, they are contacted by scammers who develop a relationship of trust and confidence with the victim. Scammers may offer to "teach" the user how to trade on a fake investing platform or even connect the victim with their own personal advisor who will speak with the user daily. Scammers then guide their victims to a legitimate-looking website or app — often a clone of a real trading platform — and ask victims to invest a small amount of money at first. The app will show the investment making significant profits over the course of a few days, and scammers may let the victim withdraw some of the initial profit back to their bank account. Believing the platform is legitimate and having developed a close connection with the scammers, victims will over time invest larger amounts of money. 
3. The Scam: Once the victims seek to withdraw their profits, they are told they need to pay some kind of fee, such as a commission or tax, to do so. Even if the victims pay, the scammers will find other excuses not to return the money. Once the victim stops paying these fees or making more investments, the scammers will disappear along with the victim’s investment.

PROTECT YOURSELF 

Californians should be very cautious before responding to any social media investment ads and making related investments. Reputable broker-dealers and investment advisors typically do not advertise their investment strategies on social media.

Fraudulent transactions, especially those involving cryptocurrency, can sometimes be irreversible. If you choose to deal in cryptocurrency, always keep a paper trail and archive all communications. If you lose your money, you may hear from a purported asset recovery specialist or attorney who promises to retrieve the money you lost for a fee. Be very wary of these people as some may be looking to take advantage of your situation to make money — and may even be scammers themselves.  

To avoid falling victim to predatory investment schemes on social media, people should take the following steps: 

1. Identify Red Flags

Be highly skeptical if you see:

• Promises of guaranteed returns: No legitimate investment is “risk-free” or offers a guaranteed return.
• High-pressure tactics: Warnings that you will “miss out” or demands to invest immediately.
• Celebrity endorsements: Scammers often use AI-generated images or videos of famous entrepreneurs to lure victims.
• Cryptocurrency demands: Requests to use crypto ATMs or to send crypto to private wallets or platforms should be regarded with suspicion. Crypto assets are extremely volatile, and purchasing them involves a very high degree of risk — you should not use any money that you cannot afford to lose.
• Requests to accept other people’s money: Scammers will sometimes ask victims to accept other people’s funds in their bank accounts and convert them to cryptocurrency.  
• Platform hopping: Requests to move the conversation from Facebook to encrypted apps like WhatsApp or Telegram.

2. Verify Before You Invest

Conduct your own independent research:

• Verify credentials: Use FINRA’s BrokerCheck to confirm if a professional is registered. But be wary, scams may often impersonate people, firms, and their credentials.
• Search for reviews: Search the name of the company or salesperson alongside words like “scam” or “complaint.”
• Check email addresses: Verify that you are communicating with a real email associated with a real advisor’s company. Remember that scammers may register email addresses that are slightly different or may change one letter from a legitimate domain.
• Look for spelling errors: Given that many scams sometimes originate overseas, ads and other communications may have spelling mistakes.  
• Consult with a trusted advisor: Before investing, consult a trusted legal professional or financial advisor who can advise you if the investment is proper.
• Follow warnings from current advisors: If your bank or investment/financial advisor cautions you about your new investment, take time to further investigate the new “investment opportunity” and do not simply dismiss their concerns.
• Trust your instincts and think twice before investing: If an investment seems fishy or too good to be true, it probably is.

3. Beware of "Deepfakes" and AI

Scam ads now use sophisticated technology to mimic real people in videos or livestreams.

• Spot the fake: If a video seems slightly off or the audio doesn’t perfectly match the lip movements, it may be a deepfake.
• Reverse search: If you see a video of a famous figure, search for the original footage online. Fraudsters often repurpose old interviews.
• Beware of financial advice: Famous figures do not usually provide financial advice online or advertise dealing in obscure cryptocurrency trading platforms. 

4. Protect Your Identity and Network

Your Facebook, Instagram, and WhatsApp profiles are gold mines for scammers looking to build a relationship with you.

• Lock down your profile: Change your settings to keep your friends list, photos, and posts private. This prevents scammers from seeing who you know.
• Verify friends: If a friend suddenly messages you about a "great investment opportunity," contact them outside of Facebook via phone call or text to ensure their account hasn't been hacked.
• Never share credentials: Do not provide login info, Social Security numbers, or financial details to anyone you met online. 
• Do not provide strangers access to your devices: Do not allow anyone you do not know well to access your computer or mobile phone remotely to help you with your existing investment account or open a new account. Often times, scammers will pose as a representative of the company you have an account with and ask for a password or answers to the security questions and — within seconds — empty everything in your account.

Anyone who may have fallen victim to these types of scams can report it to the California Department of Justice at oag.ca.gov/report.

 Californians, check out these tips to find safe, free, and low-cost ways to file your taxes 

OAKLAND — California Attorney General Rob Bonta today issued a consumer alert urging Californians to learn about free or low-cost tax filing options. As Tax Day approaches, many Californians may seek out assistance with filing their tax returns. Through the CalFile program, eligible California taxpayers can file their 2025 state taxes for free. 

“For Californians, Tax Day isn’t just a deadline, it is a reminder of how much hard work goes into every dollar earned and every dollar owed. What many Californians may not realize is that filing doesn’t have to come with additional costs. Too often, people pay for third-party tax preparation services without knowing they may qualify to file their taxes for free,” said Attorney General Bonta. “As Tax Day approaches, I encourage Californians to file early and explore trusted free or low-cost filing options. Before paying to file, take a moment to check if you qualify and keep more of your hard-earned money where it belongs — in your pocket.”

Franchise Tax Board’s (FTB) CalFile is California's free e-filing service for state tax returns. The CalFile program allows eligible taxpayers to file state tax returns quickly, securely, and free of charge. By removing barriers to filing, this program may allow consumers to get tax refunds and claim critical tax benefits like California’s Earned Income Tax Credit and Young Child Tax Credit.

MORE TAX PREPARATION RESOURCES:

• Code for America Tax File is a free tax filing service that offers virtual tax filing service that helps qualified individuals and families file their taxes online, maximize refunds, and access essential tax credits.
• The IRS Volunteer Income Tax Assistance program provides free tax help to people who make $64,000 or less annually, persons with disabilities, and people who do not understand English well.
• The Tax Counseling for the Elderly program offers free tax help for all taxpayers, particularly those over 60, specializing in questions about pensions and retirement-related issues. 
• More Cash in your Pocket: You may qualify for cash back or a reduction of the tax you owe under the Earned Income Tax Credit and the California Earned Income Tax Credit programs.
• Need more time to prepare? You can electronically request an automatic tax-filing extension, regardless of your income. You will then have until October 15 to file a return. More information on how to request an extension can be found on the IRS website.
• Find a Reputable Tax Preparer: If you decide to hire a tax preparer, make sure your tax preparer is reputable and qualified to provide tax services. In California, only an attorney, certified public accountant (CPA), IRS-enrolled agent, or registered-tax preparer can prepare tax returns for a fee. You can verify a CPA’s license with the California Board of Accountancy. You can also confirm whether a tax preparer is registered with the IRS.  

If you believe you have been the victim of a tax-related scam or other misconduct, you can file a complaint with our office at oag.ca.gov/report or with the IRS.

To learn about how to protect yourself and your loved ones against fraud, visit our website at oag.ca.gov/consumers/general/taxes.

OAKLAND — California Attorney General Rob Bonta today issued the following statement regarding the firing of Gail Slater, head of the U.S. Department of Justice Antitrust Division, an action that continues the Trump Administration’s relentless attacks on the federal watchdogs responsible for keeping life affordable for Americans:

“From President Trump’s efforts to dismantle the CFPB, to instituting tariffs that have raised prices on nearly everything, and now, firing the head of the federal DOJ’s antitrust office tasked with protecting fairness in the marketplace, it’s abundantly clear: The Trump Administration is more concerned with protecting corporate interests than making life affordable for American families. While our billionaire President may dismiss 'affordability' as a hoax, people across the nation are being forced to pay increasingly higher bills with increasingly emptier wallets. Allowing big corporations to raise prices and push competitors out of the marketplace with impunity will only worsen this crisis. While the federal government has abdicated its responsibility to look out for people’s economic wellbeing — in California, we never will. My office has led the nation in consumer protection and antitrust work for decades, and we will continue to do so. While President Trump is abandoning the economy that everyday Americans experience, we are standing up to tackle America's affordability crisis.”

Antitrust enforcement is an essential component of a healthy economy. Competitive marketplaces established through antitrust vigilance help consumers by ensuring fair prices for goods and services, an array of products to choose from, quality goods and services, and the steady introduction of innovative new products. As part of the Attorney General’s commitment to enforce antitrust laws, the California Department of Justice has launched an Antitrust Complaint Form for people to report anticompetitive conduct that potentially violates the antitrust laws.

If you see hawking — or suspicious ticket reselling — be a patriot and submit a complaint

OAKLAND — Ahead of Super Bowl LX, taking place in Santa Clara, California, California Attorney General Rob Bonta today issued a consumer alert warning football fans of counterfeit Super Bowl tickets and scammers. In today’s alert, Attorney General Bonta reminds Californians to exercise caution in their online transactions and provides tips to avoid falling victim to ticket scams. 

“We all enjoy going to live shows and games to see our favorite artists or sports teams, but unfortunately scammers prey on our excitement,” said Attorney General Bonta. “Today I remind Californians: If you see hawking — or suspicious ticket reselling — protect yourself by following the tips we provide. If you have fallen victim to a scam or suspect fraudulent activity, be a patriot and submit a complaint. You can file a report with my office at oag.ca.gov/report as well as the Better Business Bureau and the FBI’s Internet Complaint Center.” 

Protect Yourself from Ticket Scams: 

• Purchase tickets from authorized vendors: When possible, always purchase your tickets directly from official websites to confirm the ticket's authenticity.
• Know the refund policy: Before purchasing third-party resale tickets, look into the reseller’s refund policy and whether they offer a guarantee regarding the authenticity and timely arrival of the tickets.
• Protect your personal information: Never provide personal information, such as your Social Security number or bank account number to prevent financial loss and fraud.
• Verify the web address safety: Double-check the website URL by ensuring the link starts with “https://” and has a padlock icon to ensure your credit card and billing information remain safe.
• Do your research: Search for online reviews regarding the seller and any potential customer complaints for prior scams.
• Use secure payment methods: Consider using your credit card to ensure that you have an opportunity to dispute fraudulent charges. Avoid using instant payment platforms like Zelle, Venmo, and Cash App, or you could risk never getting your money back. Do not pay for tickets with gift cards, prepaid debit cards, wire transfers, or cryptocurrency. Demands for payment using those methods are a strong warning sign of a scam.
• Be wary of overly discounted tickets: Be extra cautious with low-priced and/or hard-to-get tickets. If the price seems too good to be true, it probably is. 

If consumers have fallen victim to a ticket scam, they can file a complaint with our office at oag.ca.gov/report. Consumers can also report the incident to the Better Business Bureau and the FBI’s Internet Complaint Center.

OAKLAND — California Attorney General Rob Bonta today issued a consumer alert following the Governor’s declaration of a state of emergency in response to increased risk of debris flow due to incoming rain and snow in areas affected by the Pack Fire in Mono County. The Pack Fire ignited on November 13 near Lake Crowley in the eastern Sierra Nevada, and was fully contained on December 3, destroying 30 residential and commercial structures and damaging six others. 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 visit the Governor's Office of Emergency Services Price Gouging webpage. 

“As incoming precipitation and snowfall threatens to increase the risk of debris flow from the Pack Fire, I urge Californians who reside in Mono County to listen to communication from officials and keep safe. California’s price gouging law protects people impacted by an emergency from illegal price gouging on housing, gas, food, and other essential supplies,” said Attorney General Bonta. “If you see price gouging — or if you've been the victim of it — I encourage you to immediately file a complaint with my office online at oag.ca.gov/report or contact your local police department or sheriff’s office.” 

California law generally prohibits charging a price that exceeds, by more than 10%, the price a seller charged for an item before a state or local declaration of emergency. For items 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, transportation, 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.

Violations of the price gouging statute are misdemeanors that are subject to criminal prosecution that can result in imprisonment and/or a fine. They can also result in civil enforcement actions, including civil penalties of up to $2,500 per violation, injunctive relief, and restitution. The Attorney General and local district attorneys and city prosecutors can enforce the statute.

OAKLAND — California Attorney General Rob Bonta today issued a consumer alert reminding consumers and lenders that credit discrimination remains illegal, under both California law and federal law. In October, as part of the Trump Administration’s continued gutting of the Consumer Financial Protection Bureau (CFPB), the CFPB prematurely terminated the consent order that documented its settlement with Citibank for allegedly discriminating against Armenian-American credit card applicants in Southern California, sending a strong message of the Trump Administration’s abandonment of these critical protections for consumers. 

“Credit discrimination remains illegal in California and throughout the United States. The Trump Administration’s premature termination of the settlement with Citibank for discriminating against Armenian-American applicants in California is alarming and no doubt another sign of the Bureau abandoning its obligation to protect the American people from unfair treatment by big corporations,” said Attorney General Bonta. “This, however, is not a sign that no one is looking. Let me be very clear: I will use the force of my office against financial institutions that deny brighter financial futures to Californians on the basis of their sex, race, religion or any protected characteristics.”

What is Credit Discrimination?

Credit discrimination is when a lender makes a decision about offering or denying credit based on a person's race, color, religion, national origin, sex, marital status, age, military or veteran status, because they receive public assistance, or based on another impermissible basis. Credit discrimination can manifest in various ways, such as consumers being discouraged from applying for credit, being offered less favorable terms such as higher interest rates or higher fees, or being refused credit despite meeting requirements, because of the factors listed above. 

People use credit to take out student loans, open businesses, and buy cars and homes. Building credit helps consumers to build a better future for themselves and future generations. Credit discrimination prevents people from having access to these opportunities and can make credit more expensive.

The Legal Bits: Federal and State Laws Banning Credit Discrimination

Federal and state laws prohibit discrimination by banks, lenders, credit card companies, and other lenders and financial institutions. 

The federal Equal Credit Opportunity Act (ECOA) prohibits financial institutions from discriminating against individuals on the basis of race, color, religion, national origin, sex, gender, marital status, age, receipt of public assistance, and other protected characteristics in all aspects of credit transactions, including applications, approvals, and terms and conditions. (15 U.S.C. section 1691 et seq.)

Similarly, the California Unruh Civil Rights Act (Unruh Act) prohibits discrimination on the basis of race, color, religion, ancestry, national origin, disability, medical condition, age, marital status, sexual orientation, sex, gender, or gender identity, as well as other protected characteristics by any business providing services in the state. (See Cal. Civ. Code section 51 et seq.) In addition to prohibiting discrimination in credit transactions, the Unruh Act prohibits banks, lenders, credit card companies, financial institutions, and other businesses from discrimination in any and all services that the business may provide.

California law also offers specific protections against discrimination in lending for housing finance. Under the Fair Employment and Housing Act, any financial institution that provides financial assistance for the purchase, organization, or construction of any housing accommodation is prohibited from discriminating in the terms or conditions of financing on the basis of protected characteristics, including but not limited to race, color, religion, sex, gender identity or expression, sexual orientation, marital status, national origin, ancestry, familial status, disability, source of income, veteran or military status, and genetic information. (See Cal. Gov’t Code section 12955, subd. (e).) Likewise, California’s Holden Act provides similar protections against discriminatory practices in housing finance. (See Bus. & Prof. Code section 35800 et seq.). And California's Military and Veterans Code prohibits discriminatory practices targeting members of the armed forces. (See Cal. Mil. & Vet. Code section 394).

Report It!

People who believe that they have been denied services or discriminated against because of a protected characteristic, and whistleblowers with information regarding potential violations of state or federal fair lending laws, can file a complaint with:

• The California Attorney General’s Office: oag.ca.gov/report
• The California Civil Rights Department: calcivilrights.ca.gov
• The California Department of Financial Protection and Innovation:  dfpi.ca.gov/submit-a-complaint/

OAKLAND — California Attorney General Rob Bonta today issued a consumer alert reminding consumers, healthcare providers, and credit reporting agencies that in California it remains illegal for medical debt to appear on credit reports. Recently, the Trump Administration’s Consumer Financial Protection Bureau (CFPB) issued an interpretive rule claiming that federal law generally preempts state medical debt laws — it does not. 

“In California, it is illegal for medical debt to appear on your credit report. Medical debt — which the law generally defines as debt owed to a provider of medical services, products, or devices — is generally unforeseen; it is not a reliable predictor of credit risk and can make it harder for people who are already struggling to secure housing, a job, or a car to get to work," said Attorney General Bonta. "California banned medical debt from appearing on credit reports because we recognized this practice as harmful to struggling consumers and not helpful in determining creditworthiness. Let me be clear: This remains the law in California. I urge consumers to understand their rights and to regularly check their credit reports to ensure medical debt does not make an appearance. The California Department of Justice is committed to protecting and enforcing all of California's laws — including this one.”

California’s Law

Senate Bill 1061 (SB 1061), authored by Senator Monique Limón (D-Santa Barbara) and sponsored by Attorney General Bonta, went into effect on January 1, 2025, and protects consumers from having their credit ruined by medical debt appearing on credit reports. 

Nationally, medical debt continues to rise, creating significant barriers to employment, housing, and equitable access to healthcare. People with medical debt are more likely than those with student loans or credit card debt to report being denied a rental or mortgage, increasing their risk of homelessness or forcing them into substandard housing. Medical debt can hinder employment opportunities, as employers often rely on credit reports in hiring decisions, further complicating efforts to repay the debt. Many consumers also delay essential medical care due to financial burdens, which can result in worsening health conditions.  

Monitoring Your Credit Report 

The best way to ensure medical debt has not appeared on your credit report is by regularly checking your credit report for inaccuracies or changes. Consumers are entitled to one free credit report per year from each of the three national credit bureaus. Those bureaus are Equifax, Experian, and TransUnion. You have the option of requesting all three reports at once or staggering them. Checking your credit reports at least once a year is a good way to discover errors, like the inclusion of medical debt or even identity theft. These errors could raise your cost of credit or cut you off from credit. The sooner these errors are discovered, the easier they are to clear up.  

You can order your free annual credit reports through a toll-free phone number (1-877-322-8228), online, at www.annualcreditreport.com/cra/index.jsp, or by mailing the order form here to the following address: 

Annual Credit Report Request Service
P. O. Box 105281
Atlanta, GA 30348-5281

For more information on how to order, read, and correct your credit report, please visit here. 

If You Find Medical Debt on Your Credit Report 

If consumers find medical debt on their credit report, they should notify the medical provider’s office, debt holder, and credit agency to allow them an opportunity to quickly remove the information from their credit report. If the issue persists after providing notice to the medical provider, debt holder or credit bureau, consumers may consider consulting a private attorney or legal aid.

Consumers who find medical debt on their credit report can also file a complaint with the California Department of Justice at oag.ca.gov/report.

OAKLAND — In honor of Veterans Day, California Attorney General Rob Bonta issued a consumer alert warning veterans and their families to be aware of scams and fraud, including fraud perpetrated by predatory individuals or companies who exploit veterans seeking assistance accessing their benefits. Unaccredited claims representatives, sometimes referred to as “claim sharks,” often promise a faster claims process or guaranteed benefit increases. These individuals or companies are not accredited by the U.S. Department of Veterans Affairs (VA) and operate beyond the protections and oversight of official VA regulations and their claims system. In today’s alert, Attorney General Bonta provides tips and information to help veterans guard against scams.

“On Veterans Day, and on all days, we recognize the significant sacrifices and contributions of veterans. Honoring our heroes means keeping them safe, and as part of that commitment, today we raise awareness of predatory practices targeting veterans,” said Attorney General Bonta. “Whether a person claims to be from the VA, or an offer sounds too good to be true, I urge Californians to triple check every offer and seek assistance from reliable and accredited channels when in doubt. Our veterans deserve protection as strong as their service.”

Receiving Reliable Assistance 

California veterans requiring assistance with initial benefits claims can receive free support from their local county veteran service office or from another VA-accredited representative. Accredited representatives — including attorneys and claims agents certified by the U.S. Department of Veterans Affairs — have passed exams, undergone background checks, and completed ongoing training to ensure they can assist veterans. If they do not uphold legal standards when representing veterans, these professionals can face penalties, including losing their accreditation. By contrast, unaccredited claims representatives may provide substandard assistance and often charge high fees or may even be committing outright fraud.

Common Scams Targeting Veterans

Whether it is a scammer pretending to be from the VA, or using veterans service organization seals to gain your trust, protect yourself by staying up to date on common scams targeting veterans:

• Home Loan Scams: Be aware of scammers that — through phone calls or mailers — claim to be affiliated with the government, VA, or your mortgage servicer. These fraudsters may attempt to convince you to agree to loan modifications, refinance your home, or make payments to your loans via untraceable money orders or gift cards. Be cautious of any individual or lender that: contacts you and asks you to pay fees upfront before receiving any services; tells you to cancel your mortgage payment and resend the funds elsewhere; tells you to make payments to someone other than your current loan servicer; or pressures you to sign papers you haven’t had a chance to read thoroughly or that you don’t understand — including asking you to sign over the title of your property.
• Never give out personal information to a lender or servicer that contacts you out of the blue. If you are feeling unsure, hang up and call your loan servicer directly at the number that is listed on your mortgage statement. Report suspicious activity to the California Attorney General at oag.ca.gov/report and file a complaint with the Federal Trade Commission at reportfraud.ftc.gov.
• Identity Theft and Fraud: Some scammers will pretend to be from the Department of Defense, VA, or other official organizations to get your personal information so that they can commit identity theft or fraud. Before you provide any information, always make sure a request is coming from an official organization by doing a quick search on the internet. Never trust the contact information given by the person that is asking for your personal information, as scammers often give out fake contact information. Be wary of letters and emails that have misspellings, look unprofessional, or sends you to a non-government website for information or action, as these are almost always fake. Never give out your Social Security number to get military or veteran discounts. 
• In the event that your identity is stolen, put a fraud alert on your credit report by contacting the three main credit reporting agencies Equifax, Experian, and TransUnion, and consider requesting a credit freeze, which will make it difficult for identity thieves to open new accounts in your name. Report identity theft right away and get a recovery plan at identitytheft.gov. File a police report with your local sheriff or police department and keep a copy for your records.
• Pension Scams: Veterans 65 and over are targeted by financial advisers persuading them to buy costly annuities, transfer their assets into trusts, or to pay unnecessary fees for help with a veteran’s pension application. These advisers claim to help veterans qualify for Aid and Attendance or other veteran’s benefits but may cause them to lose eligibility or access to pension or health benefits. Only the VA can award benefits. If you are interested in Aid and Attendance benefits, get free help from your County Veterans Service Office here.
• Affinity Fraud: Some scammers pose as fellow veterans or service members in order to appear trustworthy. Companies may use military-sounding names, military or veterans service organization seals, or other patriotic symbols in order to gain your trust. They may also advertise in military newspapers or magazines, use pictures of service members, or hire salespeople with a military background. Don’t be pressured into buying anything before you have a chance to shop around and do your research.
• Predatory Schools: The GI Bill and other military education programs offer veterans and their families a chance to attend school and further their education. Predatory schools often use high-pressure sales calls to try to get servicemembers and veterans to sign up. Always ask for information about the programs such as graduation rates, job placement and graduate salary information; take as much time as you need when making a decision. If a school can’t provide this basic information, they could be hiding something. For information on California’s public universities and community colleges, go to www.universityofcalifornia.edu, www.calstate.edu, or www.cccco.edu.

If you believe you have been the victim or target of a scam, immediately contact your local police department and file a complaint with the Office of the Attorney General here. For additional information on scams that target veterans, visit our website here.