Licensing Delay in California: Department Encourages Applicants to Continue the Process

Licensing delay in California is due to a change in federal background check processes for applicants, the DFPI says.

05/24/2022 11:45 A.M.

2.5 minute read

The California Department of Financial Protection and Innovation (DFPI) announced this week that the issuance of licenses under the Debt Collection Licensing Act is “unavoidably delayed” at this time. Prospective licensees are encouraged to continue submitting applications through the Nationwide Multistate Licensing System.

The Federal Bureau of Investigation informed the DFPI that new changes to state agency protocols are necessary for requesting federal background checks, according to the department’s announcement.

“The delay was unforeseen and is necessary to enable the department to effectuate the licensing background check required under the Debt Collection Licensing Act,” it states.

The Debt Collection Licensing Act, which took effect Jan. 1, 2022, requires any person engaging in the business of debt collection in California to be licensed annually by the DFPI.

The DFPI will reach out to applicants with instructions for the submission of fingerprints for background checks when the process becomes available. For purposes of including California debt collector license numbers when contacting or communicating with debtors as required under Civil Code Section 1788.11, an applicant who has filed its application through NMLS may indicate “license number pending” or similar verbiage until a license is issued.

During this delay, applicants may continue to engage in business, and the department will not take action for unlicensed activity against applicants who filed their applications after Dec. 31, 2021.

The department will notify applicants when it begins issuing licenses and encourages applicants to visit the department’s website for updates at www.dfpi.ca.gov.

ACA International will also provide these updates to members as they become available and the licensing team with Collectors Insurance Agency (CIA) is here to answer your questions.

The DFPI frequently updates its website with answers to common questions. The department anticipates additional rulemaking to implement the licensing law, and encourages interested parties to subscribe to its email subscription service to receive notices of rulemaking actions.

The DFPI is available for more information at [email protected] or by calling (916) 327-7585.

DFPI Licensing Portal

The DFPI also recently launched an online portal for consumers and debt collection license applicants to search for their operation status while their application is being reviewed by the state. The new online portal has two options to look up your application or for consumers to search for a debt collector’s license, ACA previously reported.

For more information on how the CIA licensing staff can assist with your licensing application completion needs, please contact [email protected] or call (952) 926-6547.

If you have executive leadership updates or other member news to share with ACA, contact our communications department at [email protected]. View our publications page for more information and our news submission guidelines here.

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