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STUDY OF THE CONSUMER CREDIT COUNSELING INDUSTRY IN CALIFORNIA
AND RECOMMENDATIONS TO THE LEGISLATURE REGARDING THE ESTABLISHMENT OF
FEES FOR DEBT MANAGEMENT PLANS AND DEBT SETTLEMENT PLANS
BY THE DEPARTMENT OF CORPORATIONS
April 8, 2003
Table of Contents
EXECUTIVE SUMMARY ...............................................................................................................................................................................1
BACKGROUND ...........................................................................................................................................................................................1
STUDY AND RECOMMENDATIONS...................................................................................................................................................................1
INTRODUCTION ..........................................................................................................................................................................................1
BACKGROUND AND HISTORICAL PERSPECTIVE .......................................................................................................................................2
A.
THE LICENSING OF PRORATERS .......................................................................................................................................................2
B.
THE EXEMPTION FOR NONPROFIT CONSUMER CREDIT COUNSELING ORGANIZATIONS ................................................................................3
C.
INCREASES IN THE FEE CAP ............................................................................................................................................................4
D.
CHANGES IN THE INDUSTRY.............................................................................................................................................................5
E.
INDUSTRY PROBLEMS, AB 2293, AND INCREASED REGULATORY REQUIREMENTS .....................