Cal. Code Regs. Tit. 10, § 1620.14 - Monitoring Compliance

(a) The process established and maintained by a program administrator to promote and evaluate the compliance of a PACE solicitor and PACE solicitor agent with the requirements of applicable law shall be in writing and shall comply with the requirements of this section.
(b) The process shall include a risk-based, commercially reasonable procedure to monitor and test the compliance of PACE solicitors and PACE solicitor agents with the requirements of Financial Code section 22689, subdivision (a).
(1) A risk-based, commercially reasonable procedure shall include different processes for monitoring or testing compliance that are designed to identify potential areas where the solicitation activities of PACE solicitors and PACE solicitor agents are not in compliance with applicable law. If a program administrator relies on samples of data that are intended to identify noncompliance, the program administrator shall have a reasonable basis for determining the adequacy of the sample size. The sample size shall include vulnerable populations such as seniors, non-English speakers, and low-income populations, where applicable. Nothing in this section restricts the monitoring or testing of compliance through sampling unless expressly stated.
(2) The following are examples of commercially reasonable processes for monitoring and testing whether a PACE solicitor or a PACE solicitor agent soliciting property owners is in compliance with the law. The list is not exhaustive, and a program administrator may establish and implement other or additional methods to identify noncompliance.
(A) A program administrator may monitor and test the compliance of PACE solicitors and PACE solicitor agents by posing questions to property owners during the oral confirmation of key terms required under Streets and Highways Code section 5913 or at any other time.
(B) A program administrator may monitor and test the compliance of PACE solicitors and PACE solicitor agents by conducting a confirmation of completion call to property owners.
(C) A program administrator may monitor and test the compliance of a PACE solicitor and PACE solicitor agent through an analysis of the complaints received by the program administrator.
(c) The program administrator shall monitor and test whether a PACE solicitor is maintaining the minimum qualifications required under subdivision (e) of Financial Code section 22680 for enrollment as a PACE solicitor.
(1) For purposes of monitoring and testing whether consumer complaints against a PACE solicitor evidence a clear pattern of consumer complaints about the PACE solicitor regarding dishonesty, misrepresentations, or omissions, the program administrator shall track and review the complaints containing allegations of this conduct. Notwithstanding the ability to monitor and test for compliance through sampling, a program administrator shall track all complaints that allege dishonesty, misrepresentations, or omissions.
(A) In considering evidence of a clear pattern, 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) For purposes of identifying whether a PACE solicitor's conduct presents a high likelihood that the PACE solicitor will solicit assessment contracts in a manner that does not comply with applicable law, the monitoring and testing shall be designed to identify the following:
(A) Whether the PACE solicitor has made any untrue statements to the program administrator or to a property owner.
(B) Whether the PACE solicitor has advised or knowingly permitted a property owner to make any untrue statements to the program administrator.
(D) Whether PACE solicitor has had its license revoked by the Contractors State License Board or has a complaint on file with the registrar that is available to the public on the website of the Contractors State License Board pursuant to Business and Professions Code section 7124.6.
(E) Whether the PACE solicitor has a disciplinary action against it by another regulatory agency for fraud, misrepresentation, or deceit.
(F) Whether the PACE solicitor has engaged in elder or dependent adult financial abuse as defined in Welfare and Institutions Code section 15610.30.
(3) For purposes of monitoring and testing whether a PACE solicitor has a clear pattern of failing to timely receive and respond to property owner complaints regarding the PACE solicitor, a clear pattern 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; or unreasonably delaying the response to, or investigation of, multiple complaints.
(d) The program administrator shall have risk-based, commercially reasonable processes to monitor and test a PACE solicitor's compliance with the following.
(1) Whether a PACE solicitor may be providing a different price for a project financed by a PACE assessment than the solicitor would provide if paid in cash by the property owner. A program administrator may use commercially available cost guides for guidance.
(2) Whether the PACE solicitor is commencing work prior to the expiration of the right to cancel period.
(e) The process to promote and evaluate the compliance of PACE solicitors and PACE solicitor agents with the requirements of applicable law shall include a procedure to regularly monitor the license or registration status of PACE solicitors and PACE solicitor agents as provided in Financial Code section 22680, paragraph (f)(2).
(1) The regular monitoring of the license or registration status of a PACE solicitor or PACE solicitor agent does not require continuous monitoring.
(2) Except as provided in paragraph (3), a program administrator shall confirm the licensure or registration status of a PACE solicitor or PACE solicitor agent remains in good standing at the following times:
(A) When a PACE solicitor or PACE solicitor agent submits a property owner's application for an assessment contract to the program administrator.
(B) When a program administrator processes a complaint about a PACE solicitor or PACE solicitor agent.
(C) When a program administrator enrolls a PACE solicitor or PACE solicitor agent.
(3) A program administrator that has a process for routinely monitoring the licensure or registration status of a PACE solicitor or PACE solicitor agent remains in good standing not less than once every quarter need not confirm licensure or registration status in the circumstances described in subparagraphs (e)(2)(A) and (B).
(4) The procedure for monitoring the registration status of PACE solicitor agents shall include a process to confirm whether the individuals employed or retained by the PACE solicitor to solicit a property owner to enter into an assessment contract are enrolled by the program administrator as PACE solicitor agents, have complied with the requirements of the training program, and are reported to the Department.
(f) For purposes of promoting and evaluating the compliance of PACE solicitors and PACE solicitor agents with the requirements of applicable law, the actions of a PACE solicitor agent are attributable to the PACE solicitor employing or retaining the PACE solicitor unless the PACE solicitor did not know and reasonably should not have known of the conduct of the PACE solicitor agent, the conduct giving rise to the complaint was not within the scope of the agency relationship with the PACE solicitor, and upon receiving notice of the unauthorized conduct the PACE solicitor took affirmative steps to remedy the harm caused by the conduct, and if warranted by the conduct, the PACE solicitor took timely steps to discontinue the engagement of the PACE solicitor agent in that capacity.
(g) A program administrator shall maintain in its books and records the written process required by this section and documentation that the monitoring and testing required by this section is ongoing.

Notes

Cal. Code Regs. Tit. 10, § 1620.14
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: Sections 22680 and 22689, Financial Code.

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.

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