BILL ANALYSIS
SENATE RULES COMMITTEE AB 433
Office of Senate Floor Analyses
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THIRD READING
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Bill No: AB 433
Author: Hertzberg (D)
Amended: 6/16/97 in Senate
Vote: 21
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SENATE PUBLIC SAFETY COMMITTEE : 8-0, 6/10/97
AYES: Vasconcellos, Rainey, Burton, Kopp, McPherson,
Polanco, Schiff, Watson
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
ASSEMBLY FLOOR : 64-10, 5/14/97 - See last page for vote
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SUBJECT : County investigators
SOURCE : Los Angeles County Board of Supervisors
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DIGEST : This bill would allow county auditor-controllers
and finance directors specified access to financial
information when investigating fraud against the county.
This bill provides that these county employees, who are not
peace officers, be able to exercise powers of peace
officers which would be the power of arrest, power to serve
warrants, and access to summary history criminal
information.
ANALYSIS : This bill has two parts which relate to county
auditor-controllers and directors of finance.
The first part of the bill deals with access to financial
records.
Existing law, the California Right to Financial Privacy
Act, protects the confidentiality between financial
institutions and their customers and grants disclosure of
financial information for specified purposes and by
specified procedures.
Under current law, specific entities and agencies are
allowed to access financial records under specified
conditions. Some of these entities are police and
sheriff's departments and district attorneys when a crime
report has been filed which involves the alleged fraudulent
use of drafts, checks or other orders drawn upon a bank.
Further, in specified circumstances, the Attorney General,
State Board of Equalization, Franchise Tax Board, and the
Controller have access to information regarding whether the
person has an account(s) at the office or branch and any
identifying numbers of the account(s).
Under current law, it is a misdemeanor, punishable by up to
one year in jail or a fine up to $5,000 or both, to intend
to violate, knowingly participate, induce, or attempt to
induce a person to release any financial information not
authorized in current law.
This bill would allow a county auditor-controller or
director of finance to obtain financial information when
investigating fraud against the county. This financial
information is limited to whether the person has an
account(s) at the office or branch, and if so, to obtain
any identifying numbers of the account or accounts.
This bill states that a county auditor-controller or
director of finance who unlawfully discloses information he
or she is authored to request in this bill would be guilty
of the unlawful disclosure set forth in current law,
Section 7485 of the Government Code. This misdemeanor
would be punishable by up to one year in jail or a fine up
to $5,000, or both.
The second part of the bill grants investigators employed
by county auditor-controllers and directors of finance
limited powers of peace officers.
Under current law, specified persons who are not peace
officers are granted certain powers of peace officers.
These people may exercise the powers of arrest, serve
warrants, and obtain summary criminal history information
if they complete training prescribed by the Commission on
Peace Officer Standards and Training.
Under existing law, persons who may be granted the power of
arrest, warrant, and obtaining summary criminal history
peace officers include persons employed by the Department
of Real Estate, State Lands Commission, Investigations
Bureau of the Department of Insurance, and Public Utilities
Commission.
Under current law, notwithstanding any other law, people
who are not peace officers but may exercise the specified
powers of peace officers may not carry firearms.
Current law allows various employees to exercise the power
of arrest. Some of these employees are persons designated
by a cemetery authority, persons employed as security
officers for institutions of higher education, and persons
appointed by the Executive Director of the California
Museum of Science and Industry.
This bill would grant persons employed as investigators of
an auditor-controller or director of finance of any county,
or persons employed by a city and county who conduct
investigations under the supervision of the controller of
the city and county, the powers of arrest, to serve
warrants, and to obtain summary criminal history
information with specified exceptions.
This bill would require all county auditor-controllers and
finance directors who would be given the specified powers
to complete peace officer training requirements. Each
individual would have to satisfactorily complete an
introductory course of training prescribed by the
Commission on Peace Officer Standards and Training,
demonstrated by passage of an appropriate examination
developed or approved by the commission.
This bill states that the individuals must be regularly
employed and paid in the capacity of an investigator and
that their primary duty must be to engage in investigations
related to the theft of funds or the misappropriation of
funds or resources or investigations related to the duties
of the auditor-controller or finance director.
The purpose of this bill is to grant county
auditor-controllers and directors of finance additional
access to financial records and limited powers of peace
officers for purposes of county investigations.
Prior Legislation
SB 1672 (Rosenthal), Chapter 1066, Statutes of 1996, passed
the Senate
31-0.
AB 2713 (Conroy), Chapter 1065, Statutes of 1996, passed
the Senate 31-1 (Noes: Lewis).
AB 3351 (Weggeland), Chapter 1064, Statutes of 1996, passed
the Senate 37-0.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: Yes
SUPPORT : (Verified 6/26/97)
Los Angeles County District Attorney's Office
Urban Counties Caucus
City and County of San Francisco
Controller's Audits Division of the City and County of San
Francisco
County of Los Angeles Department of Auditor-Controller
County of Sacramento Department of Finance
County of San Diego Auditor and Controller
County of Fresno Auditor-Controller/Treasurer-Tax Collector
OPPOSITION : (Verified 6/26/97)
California Attorneys for Criminal Justice
ARGUMENTS IN SUPPORT : The sponsor of this bill, the Los
Angeles County Board of Supervisors, states:
"Under current law, only peace officers and specifically
designated employees of State agencies have the authority
to serve search warrants and to obtain financial, criminal,
motor vehicle and other information during investigations.
Assembly Bill 433 authorizes investigators of county
auditor-controller offices to receive information from
financial institutions during fraud investigations and to
serve warrants or receive criminal information during
investigations of theft of funds or misappropriation of
funds. Unlawful disclosure of any investigative
information would be punished as a misdemeanor."
Further, the sponsor states that the auditor-controller
investigators generally work on matters involving theft or
embezzlement of county funds, and L.A. County has been
hampered by not being able to receive certain information
which would have helped in an investigation.
The sponsor and supporters of this bill also argue that
this bill would allow them to access information in a more
timely matter than they currently are allowed to do since
they must go through their local law enforcement and
district attorney. The County of Sacramento states that
their Auditor-Controller Division maintains an audit
"hotline" for taxpayers to report fraud, waste and abuse in
county government. After the county receives complaints,
the investigators need to complete their investigations in
a timely manner, and allowing their investigators to obtain
financial information directly will enhance their ability
to perform investigations.
ARGUMENTS IN OPPOSITION : California Attorneys for
Criminal Justice (CACJ) is opposed to this bill. CACJ is
concerned that granting the powers of arrest, to serve
warrants, and to receive criminal history information could
lead to an abuse of these powers by county
auditor-controllers.
ASSEMBLY FLOOR :
AYES: Alby, Alquist, Aroner, Ashburn, Baca, Baldwin,
Battin, Baugh, Bowen, Bowler, Brewer, Brown, Campbell,
Cardenas, Cardoza, Cunneen, Davis, Ducheny, Escutia,
Figueroa, Firestone, Frusetta, Gallegos, Goldsmith,
Granlund, Havice, Hertzberg, Honda, House, Kaloogian,
Keeley, Knox, Kuehl, Kuykendall, Lempert, Machado,
Margett, Martinez, Mazzoni, McClintock, Migden,
Morrissey, Morrow, Murray, Napolitano, Ortiz, Pacheco,
Papan, Perata, Runner, Scott, Shelley, Strom-Martin,
Sweeney, Thomson, Torlakson, Villaraigosa, Vincent,
Washington, Wayne, Wildman, Woods, Wright, Bustamante
NOES: Ackerman, Aguiar, Bordonaro, Floyd, Leach, Leonard,
Olberg, Oller, Takasugi, Thompson
NOT VOTING: Caldera, Miller, Poochigian, Prenter, Pringle,
Richter
RJG:sl 6/27/97 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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