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CITY OF SANTA ANA <br />OFFICE OF THE CITY ATTORNEY <br />To: Honorable Mayor and Councilmembers <br />From: Joseph W. Fletcher, City Attorney <br />Date: February 26, 2008 <br />Re: Item 75.A./Conditional Use Permit for check cashing business at <br />230 West Warner Avenue <br />Cc: City Manager; Clerk of the Council: Asst. City Manager; Planning Director <br />This memorandum is to inform the Mayor and City Council on State law protecting consumers <br />who make use of check cashing facilities. <br />The California Legislature, beginning in 1995 and continuing through the last session, has <br />adopted comprehensive regulations governing the conduct of check cashing businesses. The <br />statutory scheme, set forth in California Civil Code sections 1789.30 - 1789.38, applies to any <br />business that cashes checks, warrants, drafts, or money orders. The statute does not apply to <br />federally or state chartered institutions (such as banks or credit unions). Also excluded are retail <br />stores that sell food or goods so long as they charge only a very small fee (not exceeding $2) to <br />cash checks or money orders as an incidental service to customers. <br />The statutes require each check casher to: <br />• charge each customer a fee for cashing a "payroll check or government check" that is <br />limited by law to not more than " 3 percent if identification is provided by the customer, <br />or 3.5 percent without the provision of identification, of the face amount of the check, or <br />three dollars ($3), whichever is greater"; <br />• charge each customer a fee for cashing a "personal check" not to exceed 12% of the value <br />of the check; <br />75A-23 <br />