California Code of Regulations
Title 10 - Investment
Chapter 3 - Commissioner of Financial Protection and Innovation
Subchapter 6 - California Financing Law
Article 15 - Pace Program Administrators
Section 1620.13 - Enrollment Denial

Universal Citation: 10 CA Code of Regs 1620.13

Current through Register 2024 Notice Reg. No. 38, September 20, 2024

(a) A program administrator shall not enroll a PACE solicitor if as a result of the review of readily and publicly available information regarding the PACE solicitor conducted as part of the program administrator's enrollment process, the program administrator finds a clear pattern of consumer complaints about the PACE solicitor regarding dishonesty, misrepresentations, or omissions, a high likelihood that the PACE solicitor will solicit assessment contracts in a manner that does not comply with applicable law. or a clear pattern of the PACE solicitor failing to timely receive and respond to property owner complaints regarding the PACE solicitor.

(b) A clear pattern may be evidenced by recurring complaints regarding the PACE solicitor that allege deception, misrepresentation, or omission, including where the complaints contain information that suggests a pattern of dishonest business practices.

(1) In considering whether a clear pattern of a dishonest business practices exists, the program administrator may consider the volume of complaints relative to the size of the PACE solicitor, the egregiousness of the alleged conduct, the PACE solicitor's response to the allegations, and the PACE solicitor's subsequent resolution of the complaints.

(2) A program administrator shall keep in its books and records documentation that it reviewed readily and publicly available information of consumer complaints about a PACE solicitor regarding dishonesty, misrepresentations, or omissions, and its findings. If the program administrator finds a clear pattern of consumer complaints about the PACE solicitor regarding dishonesty, misrepresentations, or omissions, the program administrator shall not enroll the PACE solicitor. If the program identifies applicable complaints but enrolls the PACE solicitor, the program administrator shall document the rationale for the determination that the consumer complaints regarding dishonesty, misrepresentations, or omissions do not constitute a clear pattern of a dishonest business practice.

(3) For purposes of establishing a clear pattern of consumer complaints about a PACE solicitor, complaints against a PACE solicitor agent employed or retained by a PACE solicitor shall constitute complaints about the PACE solicitor, while the PACE solicitor agent is engaged by the PACE solicitor during the time of the complaints and the subject of the complaints involves acts by the PACE solicitor agent while soliciting property owners on behalf of the PACE solicitor.

(c)

(1) A high likelihood that a PACE solicitor will solicit assessment contracts in a manner that does not comply with applicable law may be evidenced by one or more of the following, with the severity of the actions determined by the standards of the program administrator:
(A) The readily and publicly available information about the PACE solicitor, such as court records and business or consumer reviews, demonstrate a pattern of disregard for the laws applicable to the PACE solicitor, including compliance under the Contractors State License Law, as applicable.

(B) The information regarding the PACE solicitor obtained during the enrollment process indicates the PACE solicitor has not complied with the requirements for a home improvement contractor under article 10 of chapter 9, division 3 of the Business and Professions Code regarding home improvement contractors, if applicable to the PACE solicitor, such as notifying the CSLB of the employment of a registered home improvement salesperson or otherwise failing to comply with the requirements, and the PACE solicitor is unwilling or unable to bring its operations into compliance for enrollment as a PACE solicitor.

(C) The PACE solicitor, or an individual with control over the operations of the PACE solicitor, has, within the last 7 years, been convicted of or pleaded nolo contendere to a crime, or committed an act and been held liable in a civil action, involving dishonesty, fraud, or deceit. For purposes of this subparagraph, a program administrator may rely on the background check conducted by the Contractors State License Board.

(D) The PACE solicitor has at any time had its license revoked by the Contractors State License Board or has a complaint on file with the registrar that, at the time of the review conducted as part of the program administrator's enrollment process, is available to the public on the website of the Contractors State License Board pursuant to Business and Professions Code section 7124.6.

(E) The PACE solicitor has a disciplinary action against it by another regulatory agency for failing to comply with applicable law, including an action for fraud, misrepresentation, or deceit.

(F) The PACE solicitor has engaged in elder financial abuse.

(2) A program administrator shall keep in its books and records documentation demonstrating that the program administrator has conducted a review of readily and publicly available information for the purpose of identifying whether there is a high likelihood that the PACE solicitor will solicit assessment contracts in a manner that does not comply with applicable law, and its findings. Where the review identifies evidence of past noncompliance with applicable law as set forth in paragraph (1), the program administrator either shall not enroll the PACE solicitor or document the reason it has determined the past noncompliance does not establish a high likelihood that a PACE solicitor will solicit assessment contracts in a manner that does not comply with applicable law.

(3) For purposes of establishing a high likelihood that the PACE solicitor will solicit assessment contracts in a manner that does not comply with applicable law, the acts of a PACE solicitor agent employed or retained by a PACE solicitor shall be considered if the PACE solicitor knows or should have known of the acts.

(d)

(1) A clear pattern of a PACE solicitor failing to timely receive and respond to property owner complaints regarding the PACE solicitor may be established by actions by a PACE solicitor such as failing to record multiple complaints; failing to respond to multiple complainants over a sustained period of time, notwithstanding repeated contact by the complainants; or unreasonably delaying the response to, or investigation of, multiple complaints; with the severity of the actions or inaction being determined by the standards of the program administrator.

(2) A program administrator shall keep in its books and records documentation demonstrating that the program administrator has conducted a review of readily and publicly available information for the purpose of identifying whether a PACE solicitor has clear pattern of failing to timely receive and respond to property owner complaints regarding the PACE solicitor, and its findings. Where the review identifies that the PACE solicitor has failed to timely receive and respond to property owner complaints, the program administrator either shall not enroll the PACE solicitor or shall document the reason it has determined the past failures do not constitute a clear pattern of a PACE solicitor failing to timely receive and respond to property owner complaints regarding the PACE solicitor.

(3) For purposes of establishing a clear pattern of a PACE solicitor failing to timely receive and respond to property owner complaints regarding the PACE solicitor, the acts of a PACE solicitor agent employed or retained by a PACE solicitor shall be considered if the PACE solicitor agent knows or should have known of the acts.

(4) For purposes of this subdivision, a program administrator may presume that complaint responses are timely if the PACE solicitor ordinarily acknowledges complaints within three business days and takes actions to reach a resolution of complaints within thirty days, but longer time periods may be appropriate based on the characteristics of the business and the details of the complaints. For purposes of identifying whether longer time periods are timely, a program administrator may consider factors such as, but not limited to, the size and resources of the PACE solicitor, the length of time in business, the product or service of the PACE solicitor, the nature of the complaints received, and whether the PACE solicitor's actions demonstrate an intent to address the complainant's concerns, resolve the complaint, and identify the need for changes to improve business practices.

1. New section filed 8-5-2021; operative 10-1-2021 (Register 2021, No. 32). Transmission deadline specified in Government Code section 11346.4(b) extended 60 calendar days pursuant to Executive Order N-40-20 and an additional 60 calendar days pursuant to Executive Order N-71-20. Filing deadline specified in Government Code section 11349.3(a) extended 60 calendar days pursuant to Executive Order N-40-20 and an additional 60 calendar days pursuant to Executive Order N-71-20.

Note: Authority cited: Section 22150, Financial Code. Reference: Section 22680, Financial Code.

Disclaimer: These regulations may not be the most recent version. California may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.