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On August 31, California Business and Consumer Services Agency (BCSA) Secretary Rohit Chopra announced that examining businesses’ use of emerging technologies will be a priority for the newly formed agency. According to Chopra, the BCSA will evaluate how businesses use technologies, including chatbots, software, and other automated tools, to determine whether those practices harm consumers or undermine existing licensing and consumer protection requirements.
The BCSA launched on July 1 and consolidates numerous California boards, bureaus, and departments responsible for licensing, enforcement, and consumer protection. Its oversight includes the Department of Financial Protection and Innovation (DFPI), along with agencies regulating real estate and other professional and commercial activities. The announcement does not establish new legal requirements, but it provides an early indication of how the BCSA may approach technology-related supervision and enforcement.
In particular, Chopra noted that technology is increasingly being used to interact directly with consumers and supplement work traditionally performed by licensed professionals. The BCSA intends to examine whether certain uses of these technologies could implicate restrictions on unlicensed professional activity or other existing legal protections. Chopra also identified concerns involving scams, pricing practices, consumer data, and security, and indicated that the BCSA plans to coordinate with other California agencies overseeing sectors such as housing and health care.
Putting It Into Practice: The announcement builds on California’s creation of the BCSA and Chopra’s appointment to lead the agency, (previously discussed here), and adds to broader California scrutiny of automated technologies, including recently finalized requirements concerning automated decision-making technology under the California Consumer Privacy Act. Although the BCSA has not announced specific rules or enforcement initiatives arising from this priority, financial services providers and other regulated businesses operating in California should review how AI and other automated technologies are used in consumer interactions, regulated activities, and third-party services.
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