California lawmakers advance consumer protection bill amid federal regulatory shifts

California's Assembly Banking and Finance Committee convened on July 7, 2025, to address pressing concerns regarding consumer protection in the wake of significant changes in federal law. The meeting highlighted the urgent need for California to bolster its regulatory framework to safeguard consumers against unfair business practices, particularly in light of recent federal actions that have raised alarms among state lawmakers.

Assemblymember Shieva opened the discussion by expressing deep concern over the federal government's dismissal of numerous consumer protection claims, which has left many vulnerable to financial scams. "With the rise of AI and all the ways in which people can be scammed now, it's very concerning to not have ways to go after scammers," she stated, emphasizing the necessity for robust state-level protections.

Andrew, a key speaker at the meeting, elaborated on the limitations of California's current licensing statutes, which he argued do not adequately empower the Department of Financial Protection and Innovation (DFPI) to tackle emerging consumer issues. He pointed out that while the federal Consumer Financial Protection Bureau (CFPB) has the authority to intervene in lawsuits, California's existing framework lacks the necessary tools to effectively protect consumers from deceptive practices. "California needs to have the authority... to go after a scheme like that," he asserted, referencing a recent case involving Capital One Bank that exemplified the shortcomings of current regulations.

The committee members unanimously recognized the importance of the proposed bill, which aims to enhance California's ability to enforce existing consumer protection laws. The bill is not intended to create new regulations but rather to ensure that the state can act decisively in cases of severe consumer harm. "We want to make sure that in the absence of the consumer protections that used to exist at the federal level, California has a way to enforce those protections," Assemblymember Shieva concluded.

As federal oversight becomes increasingly uncertain, California is poised to take the lead in financial regulation, ensuring that its residents are shielded from potential exploitation in a rapidly evolving economic landscape. The committee's discussions signal a proactive approach to consumer protection, with lawmakers committed to adapting state laws to meet the challenges posed by both technological advancements and shifting federal policies.