In 2020, the California State Legislature passed the California Consumer Financial Protection Law ("CCFPL') as AB 1864. This law provided the Department of Financial Protection and Innovation ("DFPI") with authority to oversee several areas of the financial marketplace, including private postsecondary education financing.
DFPI recently finalized new regulations requiring providers of postsecondary education financing to register and submit data to DFPI. Providers subject to registration requirements must file an application by February 15, 2025.
The DFPI is requesting all postsecondary institutions to do one of the following:
- If you are a postsecondary institution that offers or provides education financing to California residents and required to register, please file an application for CCFPL registration by February 15, 2025, to continue operating legally in the state.
- If you are a postsecondary institution that offers or provides education financing to California residents through a partnership with a third-party, please alert any third party partners of this registration requirement and send an email to CCFPL. CCFPL.Inquiries@dfpi.ca.gov explaining why you do not intend to register.
- If you are a postsecondary institution that is not subject to this registration requirement, please send an email to CCFPL.Inquiries@dfpi.ca.gov explaining why you do not intend to register.
Under the CCFPL, no person shall engage in the business of offering or providing postsecondary education financing to California residents without first registering with the DFPI. Postsecondary institutions should contact counsel to determine if its educational financing (including providing institutional loans) triggers registration.
Disclaimer: This Alert has been prepared and published for informational purposes only and is not offered, nor should be construed, as legal advice. For more information, please see the firm's full disclaimer.
