Financial Code — Part 5 | FIN — United States — California law | Esheria

Financial Code

Part 5 of 17 · provisions 801–1,000

This section says the act may be cited as the Financial Code.

Jurisdiction
United States — California
Instrument
Code
Citation
FIN
Version
Undated source snapshot
Language
en
Official source
View official record ↗
Complete work
View statute overview
APR disclosure ATM lighting ATM operations ATM surcharge disclosure ATM user safety Application hearings Approval changes California branch office California branch offices California facilities FDIC notice Holding companies Investment in securities Investment operations PACE assessment PACE assessment contracts PACE assessments PACE contracts PACE financing PACE program administration PACE programs PACE solicitor PACE solicitor agents PACE solicitors +3,232 more

Statute overview

About this statute

The commissioner must let certain debt collectors keep operating if they applied before January 1, 2023, and may issue a conditional license while an application is pending. Local governments in this state may not require a debt collector to be licensed or to register as a debt collector. This division is named the Debt Collection Licensing Act and may be cited by that name. A person may not do debt collection business in this state without first getting a license, and the license is tied to the principal place of business and cannot be transferred or assigned. This section defines key terms used in the Debt Collection Licensing Act.

Read the provisions Ask with citations

Legal text

Provisions of Financial Code

Showing 200 of 3,273

  1. 1660.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 18. Interstate Acquisitions [1660 - 1664] ( Chapter 18 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    This chapter does not apply to certain bank-control acquisitions, sales, or mergers that need commissioner approval under the cited provisions.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 18. Interstate Acquisitions [1660 - 1664] ( Chapter 18 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1660. This chapter does not apply to any of the following transactions: (a) An acquisition of control of a California state bank that requires the approval of the commissioner under Chapter 7 (commencing with Section 1250). (b) A sale or merger that requires the approval of the commissioner under Division 1.6 (commencing with Section 4800). (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  2. 16600.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 6. Conduct of Credit Union Business [16600 - 16607] ( Article 6 added by Stats. 2000, Ch. 612, Sec. 4. )

    Verify source ↗

    A foreign credit union with a license to maintain an office may conduct office activities only if those activities are authorized by its home-country law and California law.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 6. Conduct of Credit Union Business [16600 - 16607] ( Article 6 added by Stats. 2000, Ch. 612, Sec. 4. ) ## 16600. (a) A foreign (other nation) credit union that has a license to establish and maintain an office may engage in activities at the office as may be authorized under applicable laws of its home country and the laws of this state. (b) Nothing in subdivision (a) authorizes a foreign (other nation) credit union to engage in any activity at an office that it is not authorized to engage in or is prohibited from engaging in under the law of its home country, or that credit unions organized under the laws of this state are not authorized to engage in or are prohibited from engaging in under the laws of this state. (Added by Stats. 2000, Ch. 612, Sec. 4. Effective January 1, 2001.)
  3. 16601.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 6. Conduct of Credit Union Business [16600 - 16607] ( Article 6 added by Stats. 2000, Ch. 612, Sec. 4. )

    Verify source ↗

    A foreign credit union may not expand its field of membership in this state unless it first gets the commissioner’s approval.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 6. Conduct of Credit Union Business [16600 - 16607] ( Article 6 added by Stats. 2000, Ch. 612, Sec. 4. ) ## 16601. (a) A foreign (other nation) credit union may not expand its field of membership in this state without first obtaining the commissioner’s approval. (b) An application for the commissioner’s approval of an expansion of the field of membership in this state by a foreign (other nation) credit union shall be in the form and contain the information as may be specified, by order or regulation, by the commissioner. (Added by Stats. 2000, Ch. 612, Sec. 4. Effective January 1, 2001.)
  4. 16602.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 6. Conduct of Credit Union Business [16600 - 16607] ( Article 6 added by Stats. 2000, Ch. 612, Sec. 4. )

    Verify source ↗

    This section says certain California credit union laws apply to a foreign credit union that has a branch office or agency in the state.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 6. Conduct of Credit Union Business [16600 - 16607] ( Article 6 added by Stats. 2000, Ch. 612, Sec. 4. ) ## 16602. (a) The following provisions of this code apply to a foreign (other nation) credit union that maintains a branch office or agency with respect to its business in this state as if the foreign (other nation) credit union were a credit union organized under the laws of this state: (1) Section 14203. (2) Section 14204. (3) Section 14208. (4) Section 14210. (5) Section 14256. (6) Section 14409. (7) Section 14409.2. (8) Section 14602. (9) Section 14652.5. (10) Section 14655, to the extent promissory notes of the type described in this section are carried on the books of a branch office of a foreign (other nation) credit union. (11) Section 14656, to the extent promissory notes of the type described in this section are carried on the books of a branch office of a foreign (other nation) credit union. (12) Article 8 (commencing with Section 14750) of Chapter 4. (13) Section 14800. (14) Section 14802. (15) Section 14803. (16) Section 14807. (17) Section 14808. (18) Section 14809. (19) Article 1 (commencing with Section 14850) of Chapter 6. (20) Article 1 (commencing with Section 14950) of Chapter 7. (21) Article 2 (commencing with Section 15001) of Chapter 7. (22) Article 3 (commencing with Section 15050) of Chapter 7, to the extent loans of the type described in that article are carried on the books of a branch office of a foreign (other nation) credit union. (23) Section 15102. (b) In addition to the laws specified in subdivision (a), the laws of this state applicable to transactions between a credit union organized under the laws of this state and its members and creditors shall similarly apply to the transactions of a foreign (other nation) credit union in this state. These laws include, but are not limited to, consumer protection laws and laws relating to creditor rights and remedies, commercial transactions, mortgages and deeds of trust, bank deposits and collections, and negotiable instruments. (Added by Stats. 2000, Ch. 612, Sec. 4. Effective January 1, 2001.)
  5. 16603.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 6. Conduct of Credit Union Business [16600 - 16607] ( Article 6 added by Stats. 2000, Ch. 612, Sec. 4. )

    Verify source ↗

    A qualifying foreign credit union operating a branch office or agency is exempt from California constitutional interest-rate restrictions, but it must still comply with other applicable laws and regulations.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 6. Conduct of Credit Union Business [16600 - 16607] ( Article 6 added by Stats. 2000, Ch. 612, Sec. 4. ) ## 16603. (a) Any foreign (other nation) credit union that is authorized to and does maintain a branch office or agency is exempted from the restrictions of Section 1 of Article XV of the California Constitution relating to rates of interest upon the loan or forbearance of any money, goods, or things in action or on accounts after demand. (b) This section does not exempt a foreign (other nation) credit union or any subsidiary from complying with all other laws and regulations governing the business in which the foreign (other nation) credit union or subsidiary is engaged. (c) This section creates and authorizes an exempt class of persons pursuant to Section 1 of Article XV of the California Constitution. (Added by Stats. 2000, Ch. 612, Sec. 4. Effective January 1, 2001.)
  6. 16604.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 6. Conduct of Credit Union Business [16600 - 16607] ( Article 6 added by Stats. 2000, Ch. 612, Sec. 4. )

    Verify source ↗

    A licensed foreign credit union must keep office assets separate from its business assets outside the state, and certain in-state creditors get priority over other creditors for the in-state business assets.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 6. Conduct of Credit Union Business [16600 - 16607] ( Article 6 added by Stats. 2000, Ch. 612, Sec. 4. ) ## 16604. (a) A foreign (other nation) credit union which is licensed to establish and maintain an office or offices shall keep the assets of the offices separate and apart from the assets of its business outside this state. (b) Persons who are creditors of a foreign (other nation) credit union as a result of the business of an office of the foreign (other nation) credit union in this state shall be entitled to priority over other creditors with respect to the assets of the business in this state of the foreign (other nation) credit union. (Added by Stats. 2000, Ch. 612, Sec. 4. Effective January 1, 2001.)
  7. 16605.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 6. Conduct of Credit Union Business [16600 - 16607] ( Article 6 added by Stats. 2000, Ch. 612, Sec. 4. )

    Verify source ↗

    Foreign (other nation) credit unions must keep specified eligible assets on deposit with an approved depository, and withdrawals or releases generally need the commissioner’s prior approval.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 6. Conduct of Credit Union Business [16600 - 16607] ( Article 6 added by Stats. 2000, Ch. 612, Sec. 4. ) ## 16605. (a) In this section: (1) “Adjusted liabilities,” when used with respect to a foreign (other nation) credit union, means the liabilities of the foreign (other nation) credit union’s business in this state, determined in accordance with generally accepted accounting principles, but excluding (A) accrued expenses, (B) any liability to an office (whether in or outside of this state) or majority-owned subsidiary of the foreign (other nation) credit union, and (C) other liabilities as the commissioner may by regulation or order exclude. (2) “Applicable minimum,” when used with respect to eligible assets deposited or to be deposited with an approved depository by a foreign (other nation) credit union, means the amount as the commissioner may from time to time by regulation or order determine to be necessary for the maintenance of sound financial condition, for the protection of the interests of creditors of the foreign (other nation) credit union’s business in this state, or for the protection of the public interest. However, in the case of a foreign (other nation) credit union which is licensed to maintain a branch office, the applicable minimum shall not be less than 5 percent of the adjusted liabilities of the foreign (other nation) credit union. (3) “Approved depository,” when used with respect to a foreign (other nation) credit union, means a bank or credit union organized under the laws of this state or a national bank headquartered in this state that has been selected by the foreign (other nation) credit union and approved by the commissioner for the purpose of acting as the approved depository of the foreign (other nation) credit union and that has filed with the commissioner, in the form as the commissioner may by regulation or order prescribe, an agreement to comply with all applicable provisions of this section and of any regulation or order issued under this section. (4) “Eligible assets” when used with respect to a foreign (other nation) credit union, means any of the following: (A) Cash. (B) Any negotiable certificate of deposit that (i) has a maturity of not more than one year, (ii) is payable in the United States, and (iii) is issued by a bank organized under the laws of a state of the United States, by a national bank, or by a branch office of a foreign (other nation) bank that is located in the United States. (C) Any banker’s acceptance that is payable in the United States and that is eligible for discount with a federal reserve bank. (D) Any other asset that the commissioner by regulation or order determines to be eligible. Notwithstanding the foregoing provisions of this paragraph, “eligible asset,” when used with respect to a foreign (other nation) credit union, does not include any instrument the issuer of which (i) is, or is affiliated with, the foreign (other nation) credit union, (ii) is domiciled in, or controlled by a person domiciled in, the same foreign nation as the foreign (other nation) credit union, or (iii) is, or is controlled by, the foreign nation. For purposes of the foregoing provision, to be “affiliated” means to control, to be controlled by, or to be under common control with; and to “control” has the meaning set forth in subdivision (b) of Section 700. (b) For purposes of this section: (1) The amount of adjusted liabilities of a foreign (other nation) credit union’s business in this state shall be computed for the period of time and in the manner as the commissioner may by regulation or order prescribe. (2) An eligible asset shall be valued at the lesser of market or par. (c) (1) Before a foreign (other nation) credit union is authorized to transact business in this state, the foreign (other nation) credit union shall deposit, and each foreign (other nation) credit union that is licensed to transact business in this state shall maintain on deposit, with an approved depository eligible assets having a value in an amount not less than the applicable minimum. (2) Whenever a foreign (other nation) credit union that is licensed to transact business in this state ceases to be so licensed, the foreign (other nation) credit union shall thereafter maintain on deposit with an approved depository eligible assets having a value in an amount not less than the applicable minimum for the period of time as the commissioner may determine to be necessary for the protection of creditors of the foreign (other nation) credit union’s business in this state or for the protection of the public interest. (d) (1) No foreign (other nation) credit union that maintains eligible assets on deposit with an approved depository pursuant to this section shall withdraw any eligible asset except with the prior approval of the commissioner. (2) No approved depository that holds eligible assets on deposit from a foreign (other nation) credit union pursuant to this section shall release any eligible asset except with the prior approval of the commissioner or as otherwise provided in subdivision (h). (e) Any foreign (other nation) credit union that maintains eligible assets on deposit with an approved depository pursuant to this section shall, unless the commissioner shall have suspended or revoked its authorization to transact business in this state or taken possession of its property and business in this state, be entitled to receive any income paid on eligible assets. (f) (1) Whenever a foreign (other nation) credit union deposits eligible assets with, or withdraws eligible assets from, an approved depository pursuant to this section, the foreign (other nation) credit union shall do so in accordance with the procedures and requirements as the commissioner may by regulation or order prescribe. (2) Whenever an approved depository receives, holds, or releases eligible assets pursuant to this section, the approved depository shall do so in accordance with the procedures and requirements as the commissioner may by regulation or order prescribe and shall file with the commissioner reports as and when the commissioner may by regulation or order require. (g) Whenever a foreign (other nation) credit union maintains eligible assets on deposit with an approved depository pursuant to this section: (1) The eligible assets shall be deemed to be pledged to the commissioner for the benefit of the creditors of the foreign (other nation) credit union’s business in the state; and, notwithstanding any provision of the Uniform Commercial Code to the contrary, the commissioner, for the benefit of these creditors, shall be deemed to have a security interest in the eligible assets. (2) The eligible assets shall be free from any lien, charge, right of setoff, credit, or preference in connection with any claim of the approved depository against the foreign (other nation) credit union. (h) (1) In case the commissioner takes possession of the property and business of a foreign (other nation) credit union that maintains eligible assets on deposit with an approved depository pursuant to this section, the approved depository shall, upon order of the commissioner, release the eligible assets to the commissioner, as liquidator of the property and business of the foreign (other nation) credit union. (2) In case a foreign (other nation) credit union that maintains eligible assets on deposit with an approved depository pursuant to this section fails to pay any judgment creditor of its business in this state and the commissioner has not taken possession of the property and business of the foreign (other nation) credit union, the approved depository shall release the eligible assets to the commissioner, and the commissioner shall dispose of the eligible assets, as a court of competent jurisdiction of this state or of the United States may order for the benefit of the judgment creditor. For purposes of this paragraph, “judgment creditor of its business in this state” means a person to whom the foreign (other nation) credit union is required to pay money under a judgment that (A) arose out of the foreign (other nation) credit union’s business in this state, (B) has been entered by a court of this state or of the United States, (C) has become final, in that all possibility of direct attack on the judgment by way of appeal, motion for new trial, motion to vacate, or petition for extraordinary writ has been exhausted, and (D) has remained unpaid for a period of not less than 60 days after becoming final. (Added by Stats. 2000, Ch. 612, Sec. 4. Effective January 1, 2001.)
  8. 16607.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 6. Conduct of Credit Union Business [16600 - 16607] ( Article 6 added by Stats. 2000, Ch. 612, Sec. 4. )

    Verify source ↗

    A foreign credit union with a California branch must hold eligible assets at the branch or another commissioner-approved place, and the amount cannot exceed 108% of adjusted liabilities.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 6. Conduct of Credit Union Business [16600 - 16607] ( Article 6 added by Stats. 2000, Ch. 612, Sec. 4. ) ## 16607. (a) In this section: (1) “Adjusted liabilities,” when used with respect to a foreign (other nation) credit union that is licensed to maintain a branch office, means the liabilities of the foreign (other nation) credit union’s business in this state, excluding (A) accrued expenses, (B) any liability to an office (whether in or outside of this state) or majority-owned subsidiary of the foreign (other nation) credit union, and (C) other liabilities as the commissioner may by regulation or order exclude. (2) “Eligible assets” means any asset which the commissioner by regulation or order determines to be eligible for purposes of this section. However, “eligible asset,” when used with respect to a foreign (other nation) credit union that is licensed to maintain a branch office, includes any asset which the foreign (other nation) credit union maintains on deposit pursuant to Section 16606. (b) For purposes of this section, the amount of eligible assets and the amount of adjusted liabilities of a foreign (other nation) credit union that is licensed to maintain a branch office each be computed for the period of time and in the manner as the commissioner may by regulation or order prescribe. (c) A foreign (other nation) credit union licensed to maintain a branch office shall hold at its branch offices in this state or at any other place as the commissioner may approve, eligible assets in the amount, if any, as the commissioner may from time to time by regulation or order determine to be necessary for the maintenance of sound financial condition, for the protection of the interests of creditors of the foreign (other nation) credit union’s business in this state, or for the protection of the public interest. However, in no event shall the amount exceed 108 percent of the adjusted liabilities of the foreign (other nation) credit union’s business in this state. (d) If the commissioner finds, with respect to a foreign (other nation) credit union licensed to maintain a branch office in this state, that the action is necessary for the maintenance of sound financial condition, for the protection of the interests of creditors of the foreign (other nation) credit union’s business in this state, or for the protection of the public interest, the commissioner may order the foreign (other nation) credit union to place all or part of the eligible assets which the foreign (other nation) credit union is required to hold under subdivision (c) in the custody of a bank organized under the laws of this state or a national bank headquartered in this state as the commissioner may designate, and such assets shall be subject to the order of the commissioner. (Added by Stats. 2000, Ch. 612, Sec. 4. Effective January 1, 2001.)
  9. 1661.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 18. Interstate Acquisitions [1660 - 1664] ( Chapter 18 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    Applications for approval under this chapter must follow the required form, include required information, be signed properly, and be verified if the commissioner requires it.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 18. Interstate Acquisitions [1660 - 1664] ( Chapter 18 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1661. Each application filed with the commissioner for an approval under this chapter shall be in the form, shall contain the information, shall be signed in the manner, and shall, if the commissioner requires by regulation or order, be verified in the manner that the commissioner may by regulation or order require. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  10. 1662.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 18. Interstate Acquisitions [1660 - 1664] ( Chapter 18 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    The filing fee for an application for approval under this chapter is $2,500.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 18. Interstate Acquisitions [1660 - 1664] ( Chapter 18 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1662. The fee for filing with the commissioner an application for an approval under this chapter is two thousand five hundred dollars ($2,500). (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  11. 1663.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 18. Interstate Acquisitions [1660 - 1664] ( Chapter 18 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    Definitions from Section 3(d) of the Bank Holding Company Act apply here, and the commissioner may approve certain bank holding company acquisitions if the commissioner finds the deal is consistent with the public convenience and advantage in this state.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 18. Interstate Acquisitions [1660 - 1664] ( Chapter 18 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1663. (a) The definitions that are set forth in or are applicable to Section 3(d) of the Bank Holding Company Act of 1956 (12 U.S.C. Sec. 1842(d)) apply to this section. (b) The commissioner may approve an acquisition by a bank holding company that is subject to Section 3(d)(2)(B) and (D)(ii) of the Bank Holding Company Act of 1956 (12 U.S.C. Sec. 1842(d)(2)(B) and (D)(ii)) if the commissioner finds that the acquisition is consistent with the public convenience and advantage in this state. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  12. 1664.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 18. Interstate Acquisitions [1660 - 1664] ( Chapter 18 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    This section adopts certain federal definitions, excludes some interstate merger transactions involving industrial loan companies, and lets the commissioner approve certain interstate merger transactions if they meet a public-convenience-and-advantage test.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 18. Interstate Acquisitions [1660 - 1664] ( Chapter 18 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1664. (a) The definitions that are set forth in or are applicable to Section 44 of the Federal Deposit Insurance Act (12 U.S.C. Sec. 1831u) apply to this section. (b) This section does not apply if each bank involved in an interstate merger transaction (including each insured depository institution that is an affiliate of the surviving, resulting, or purchasing bank) that is organized under the laws of this state or that maintains a branch office in this state, is an industrial loan company (as defined in Section 4805.10). (c) The commissioner may approve an interstate merger transaction that is subject to Section 44(b)(2)(B) and (D)(ii) of the Federal Deposit Insurance Act (12 U.S.C. Sec. 1831u(b)(2)(B) and (D)(ii)) if the commissioner finds that the transaction is consistent with the public convenience and advantage in this state. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  13. 167.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 1. Definitions [99 - 217] ( Chapter 1 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    This section defines “Directors” by referring to Section 164 of the Corporations Code.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 1. Definitions [99 - 217] ( Chapter 1 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 167. “Directors” has the meaning set forth in Section 164 of the Corporations Code. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  14. 1670.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1670 - 1676] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    This section defines several banking terms used in Chapter 19.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1670 - 1676] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1670. In this chapter, unless the context otherwise requires: (a) “Branch business unit” has the meaning set forth in subdivision (a) of Section 4840. (b) “Core banking business” means the business of receiving deposits, paying checks, making loans, and other activities that the commissioner may specify by order or regulation. “Core banking business,” when used to describe the trust business, includes receiving fiduciary assets and administering fiduciary accounts. (c) “Facility,” when used with respect to a foreign (other state) bank, means an office in this state at which the bank engages in noncore banking business but at which it does not engage in core banking business. (d) “Noncore banking business” means all activities permissible for commercial banks, industrial banks, or trust companies, except core banking business, and except those activities prohibited by law or determined by the commissioner by regulation or order not to be noncore banking business. (e) “Whole business unit” has the meaning set forth in subdivision (g) of Section 4840. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  15. 16700.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 7. Examination, Reports, and Records [16700 - 16704] ( Article 7 added by Stats. 2000, Ch. 612, Sec. 4. )

    Verify source ↗

    The commissioner may investigate and examine a foreign (other nation) credit union and its subsidiary’s books and records, and the commissioner or a designated person must be given free access to the credit union’s offices and records.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 7. Examination, Reports, and Records [16700 - 16704] ( Article 7 added by Stats. 2000, Ch. 612, Sec. 4. ) ## 16700. (a) The commissioner may at any time investigate into the affairs and examine the books, accounts, and other records of a foreign (other nation) credit union and of any subsidiary thereof. (b) The commissioner and any person designated by the commissioner shall have free access to any office of the foreign (other nation) credit union and to its books, accounts, and other records. (Added by Stats. 2000, Ch. 612, Sec. 4. Effective January 1, 2001.)
  16. 16701.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 7. Examination, Reports, and Records [16700 - 16704] ( Article 7 added by Stats. 2000, Ch. 612, Sec. 4. )

    Verify source ↗

    The commissioner may examine a foreign credit union, including offices inside or outside the state, if the credit union maintains an office in the state.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 7. Examination, Reports, and Records [16700 - 16704] ( Article 7 added by Stats. 2000, Ch. 612, Sec. 4. ) ## 16701. The commissioner may make an examination of a foreign (other nation) credit union at any office of the commissioner. The commissioner may make an examination of any office, within or outside of this state, of a foreign (other nation) credit union that maintains an office in this state. (Amended by Stats. 2003, Ch. 404, Sec. 19. Effective January 1, 2004.)
  17. 16702.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 7. Examination, Reports, and Records [16700 - 16704] ( Article 7 added by Stats. 2000, Ch. 612, Sec. 4. )

    Verify source ↗

    Foreign (other nation) credit unions must file certain audit, examination, and response copies with the commissioner, generally within 10 days, unless the commissioner allows more time.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 7. Examination, Reports, and Records [16700 - 16704] ( Article 7 added by Stats. 2000, Ch. 612, Sec. 4. ) ## 16702. (a) Each foreign (other nation) credit union shall, within 10 days after receipt or within any extended time that the commissioner may specify, file with the commissioner a copy of any audit report obtained by, and of any examination report prepared for, the foreign (other nation) credit union. (b) Each foreign (other nation) credit union shall file with the commissioner a copy of any response made by the foreign (other nation) credit union to an audit or examination report referred to in subdivision (a) within 10 days after making the response or within any extended time that the commissioner may specify. (Added by Stats. 2000, Ch. 612, Sec. 4. Effective January 1, 2001.)
  18. 16703.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 7. Examination, Reports, and Records [16700 - 16704] ( Article 7 added by Stats. 2000, Ch. 612, Sec. 4. )

    Verify source ↗

    A foreign credit union must file any additional report the commissioner requires, and each report must follow the commissioner’s form, content, and filing-date requirements.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 7. Examination, Reports, and Records [16700 - 16704] ( Article 7 added by Stats. 2000, Ch. 612, Sec. 4. ) ## 16703. A foreign (other nation) credit union shall file with the commissioner any other report as the commissioner may from time to time require. Each report shall be in the form, contain the information, and be filed on the date, as may be prescribed by the commissioner. (Added by Stats. 2000, Ch. 612, Sec. 4. Effective January 1, 2001.)
  19. 16704.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 7. Examination, Reports, and Records [16700 - 16704] ( Article 7 added by Stats. 2000, Ch. 612, Sec. 4. )

    Verify source ↗

    A foreign credit union with an office must keep and preserve its office-related books, accounts, and other records at that office or another place approved by the commissioner.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 7. Examination, Reports, and Records [16700 - 16704] ( Article 7 added by Stats. 2000, Ch. 612, Sec. 4. ) ## 16704. Each foreign (other nation) credit union that maintains an office shall make, keep, and preserve at that office, or at any other place that the commissioner may by regulation or order approve, the books, accounts, and other records relating to the business of the office, in the form, in the manner, and for the time that the commissioner may, by regulation or order, require. (Added by Stats. 2000, Ch. 612, Sec. 4. Effective January 1, 2001.)
  20. 1671.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1670 - 1676] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    Applications filed under this chapter or related regulations/orders must use the required form, include required information, be signed as required, and be verified if the commissioner requires it.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1670 - 1676] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1671. Each application filed with the commissioner under this chapter or under any regulation or order issued under this chapter shall be in the form, shall contain the information, shall be signed in the manner, and shall (if the commissioner requires by regulation or order) be verified in the manner that the commissioner may by regulation or order require. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  21. 1672.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1670 - 1676] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    Foreign (other state) banks with a facility or California branch office must file commissioner-required reports, and the commissioner may require the report form, contents, signature, and verification.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1670 - 1676] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1672. (a) Each foreign (other state) bank that maintains a facility or a California branch office shall file with the commissioner such reports as and when the commissioner may by regulation or order require. (b) Each report filed with the commissioner under this chapter or under any regulation or order issued under this chapter shall be in the form, shall contain the information, shall be signed in the manner, and shall (if the commissioner requires by regulation or order) be verified in the manner that the commissioner may by regulation or order require. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  22. 1673.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1670 - 1676] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    Certain foreign banks with a facility or California branch office must keep and preserve their office-related books, accounts, and records, unless a stated exception applies.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1670 - 1676] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1673. Each foreign (other state) bank that maintains a facility (other than a foreign (other state) national bank that maintains a California branch office) and each foreign (other state) state bank that maintains a California branch office shall make, keep, and preserve at the facility or branch office or at another place that the commissioner may by regulation or order approve, the books, accounts, and other records relating to the business of the office, in the form, in the manner, and for the time that the commissioner may by regulation or order provide. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  23. 1674.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1670 - 1676] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    This section requires certain foreign (other state) banks to pay filing, licensing, branch-office, and examination fees to the commissioner.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1670 - 1676] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1674. Fees shall be paid to and collected by the commissioner as follows: (a) The fee for filing with the commissioner an application by an uninsured foreign (other state) bank for approval to establish a facility is two hundred fifty dollars ($250). (b) The fee for filing with the commissioner an application by an uninsured foreign (other state) bank that is licensed pursuant to Article 4 (commencing with Section 1710) to maintain a facility for approval to relocate or to close the facility is one hundred dollars ($100). (c) The fee for issuing a license pursuant to Article 4 (commencing with Section 1710) is twenty-five dollars ($25). (d) Each foreign (other state) state bank that on June 1 of any year maintains one or more California branch offices shall pay, on or before the following July 1, a fee of one thousand dollars ($1,000) per California branch office. However, the minimum fee paid by a foreign (other state) state bank under this subdivision shall be not less than three thousand dollars ($3,000) and the maximum fee shall be not more than fifty thousand dollars ($50,000). (e) Each foreign (other state) bank that on June 1 of any year maintains a facility but no California branch office shall pay, on or before the following July 1, a fee of two hundred fifty dollars ($250) for each facility. (f) If the commissioner makes an examination in connection with a pending application, as described in subdivision (a) or (b), the applicant shall pay a fee for the examination, as determined by the commissioner. In determining the fee, the commissioner may use the estimated average hourly cost, including, but not limited to, overhead, for all persons performing the examination, plus, if in the opinion of the commissioner it is necessary for any examiner engaged in the examination to travel outside this state, the travel expenses of the examiner. (g) If the commissioner makes an examination of a foreign (other state) state bank that maintains a California branch office, the bank shall pay a fee for the examination, as determined by the commissioner. In determining the fee, the commissioner may use the estimated average hourly cost, including, but not limited to, overhead, for all persons performing the examination, plus, if in the opinion of the commissioner it is necessary for any examiner engaged in the examination to travel outside this state, the travel expenses of the examiner. (h) If the commissioner makes an examination of a facility of an uninsured foreign (other state) bank licensed under Article 4 (commencing with Section 1710), the bank shall pay a fee for the examination, as determined by the commissioner. In determining the fee, the commissioner may use the estimated average hourly cost, including, but not limited to, overhead, for all persons performing the examination, plus, if in the opinion of the commissioner it is necessary for any examiner engaged in the examination to travel outside this state, the travel expenses of the examiner. (i) If the commissioner makes an examination of a facility of an insured foreign (other state) bank that does not maintain a California branch office, the bank shall pay a fee for the examination, as determined by the commissioner. In determining the fee, the commissioner may use the estimated average hourly cost, including, but not limited to, overhead, for all persons performing the examination, plus, if in the opinion of the commissioner it is necessary for any examiner engaged in the examination to travel outside this state, the travel expenses of the examiner. (Amended by Stats. 2025, Ch. 20, Sec. 9. (AB 137) Effective June 30, 2025.)
  24. 1675.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1670 - 1676] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    A foreign (other state) state bank is exempt from California Constitution Article XV, Section 1 interest-rate restrictions, but it must still comply with other applicable laws and regulations.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1670 - 1676] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1675. (a) Any foreign (other state) state bank is exempted from the restrictions of Section 1 of Article XV of the California Constitution relating to rates of interest upon the loan or forbearance of any money, goods, or things in action or on accounts after demand. (b) This section does not exempt a foreign (other state) state bank or any subsidiary from complying with all other laws and regulations governing the business in which the bank or subsidiary is engaged. (c) This section creates and authorizes an exempt class of persons pursuant to Section 1 of Article XV of the California Constitution. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  25. 1676.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1670 - 1676] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    A “subject bank” is defined, and such a bank cannot simultaneously keep both types of California offices described in the section.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1670 - 1676] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1676. (a) In this section, “subject bank” means a bank organized under the laws of any territory of the United States, Puerto Rico, Guam, American Samoa, the Trust Territory of the Pacific Islands, the Virgin Islands, or the Northern Mariana Islands. (b) Nothing in this chapter, except subdivision (c), applies to a subject bank that, as a foreign (other nation) bank, maintains an office in this state licensed under Chapter 20 (commencing with Section 1750) or a federal agency (as defined in Section 1750) or federal branch (as defined in Section 1750) in this state. (c) No subject bank may at the same time maintain (1) as a foreign (other state) state bank, an office in this state and (2) as a foreign (other nation) bank, an office in this state licensed under Chapter 20 (commencing with Section 1750) or a federal agency (as defined in Section 1750) or federal branch (as defined in Section 1750) in this state. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  26. 1680.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 2. California Branch Offices [1680 - 1688] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    A foreign (other state) state bank may not conduct core banking business in this state unless it does so at a branch office set up under federal law and the law of the bank’s domicile.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 2. California Branch Offices [1680 - 1688] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1680. No foreign (other state) state bank may transact core banking business in this state except at a branch office established in accordance with federal law and the law of the domicile of the bank. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  27. 16800.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 8. Voluntary Surrender of License [16800- 16800.] ( Article 8 added by Stats. 2000, Ch. 612, Sec. 4. )

    Verify source ↗

    A foreign credit union licensed to maintain an office may surrender that office’s license by filing the license and a report with the commissioner.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 8. Voluntary Surrender of License [16800- 16800.] ( Article 8 added by Stats. 2000, Ch. 612, Sec. 4. ) ## 16800. (a) A foreign (other nation) credit union that is licensed to maintain an office may voluntarily surrender the license for the office by filing the license and a report with the commissioner. However, a foreign (other nation) credit union that holds licenses to maintain two or more offices may not voluntarily surrender less than all of its licenses. (b) (1) Except as otherwise provided in paragraph (2), a voluntary surrender of a license shall be effective on the 30th day after the license and the report called for in subdivision (a) are filed with the commissioner or on an earlier date as the commissioner may by order specify. (2) If a proceeding to revoke or suspend a license is pending at the time when the license and the report called for in subdivision (a) are filed with the commissioner or if a proceeding to revoke or suspend a license or to impose conditions upon the surrender of a license is instituted before the 30th day after the license and the report called for in subdivision (a) are filed with the commissioner, the voluntary surrender of the license shall become effective at the time and upon the conditions that the commissioner may by order specify. (Added by Stats. 2000, Ch. 612, Sec. 4. Effective January 1, 2001.)
  28. 1681.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 2. California Branch Offices [1680 - 1688] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    This section says Section 1680 does not bar certain foreign state banks that do not maintain a California branch office from doing specified banking activities.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 2. California Branch Offices [1680 - 1688] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1681. Section 1680 does not prohibit: (a) Any foreign (other state) state bank that does not maintain a California branch office from carrying on the activities described in subdivision (d) of Section 191 of the Corporations Code. (b) Any foreign (other state) state bank that does not maintain a California branch office from making, in this state, loans secured by liens on real property located in this state. (c) Any foreign (other state) state bank from having a California state bank as its agent pursuant to Chapter 6.5 (commencing with Section 800). (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  29. 1682.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 2. California Branch Offices [1680 - 1688] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    A foreign bank from another state may not establish or maintain a California branch office unless it is qualified to do intrastate business in California under the referenced Corporations Code chapter.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 2. California Branch Offices [1680 - 1688] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1682. No foreign (other state) bank may establish or maintain a California branch office unless it is qualified to transact intrastate business in this state under Chapter 21 (commencing with Section 2100) of Division 1 of Title 1 of the Corporations Code. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  30. 1683.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 2. California Branch Offices [1680 - 1688] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    A foreign (other state) bank may not establish or maintain a California branch office unless the bank is insured.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 2. California Branch Offices [1680 - 1688] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1683. No foreign (other state) bank may establish or maintain a California branch office unless the bank is insured. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  31. 1684.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 2. California Branch Offices [1680 - 1688] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    Foreign (other state) banks are generally barred from merging with or buying California banks and from establishing or maintaining a California branch office except under specified conditions.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 2. California Branch Offices [1680 - 1688] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1684. (a) (1) No foreign (other state) bank may merge as the surviving corporation with a California bank, except that an insured foreign (other state) bank may do so in accordance with federal law, the law of the domicile of the foreign (other state) bank, this chapter, and Division 1.6 (commencing with Section 4800). (2) No foreign (other state) bank may purchase the whole business unit of a California bank, except that an insured foreign (other state) bank may do so in accordance with federal law, the law of the domicile of the foreign (other state) bank, this chapter, and Division 1.6 (commencing with Section 4800). (3) No foreign (other state) bank that does not already maintain a California branch office may establish or maintain a California branch office except in the manner described in paragraph (1) or (2) and in accordance with federal law, the law of the domicile of the foreign (other state) bank, and this chapter. (b) This section constitutes: (1) An election to permit early interstate merger transactions pursuant to Section 44(a)(3) of the Federal Deposit Insurance Act (12 U.S.C. Sec. 1831u(a)(3)). (2) An express prohibition against interstate branching through the acquisition of a branch business unit located in this state of a California bank (without acquisition of the whole business unit of the California bank) pursuant to Section 44(a)(4) of the Federal Deposit Insurance Act (12 U.S.C. Sec. 1831u(a)(4)). (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  32. 1685.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 2. California Branch Offices [1680 - 1688] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    A foreign bank without an existing California branch office may not merge with or buy the whole business unit of a California bank unless the California bank has been in existence for at least five years.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 2. California Branch Offices [1680 - 1688] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1685. (a) No foreign (other state) bank that does not already maintain a California branch office may: (1) Merge as the surviving bank with a California bank pursuant to paragraph (1) of subdivision (a) of Section 1684, unless the California bank has been in existence for at least five years. (2) Purchase the whole business unit of a California bank pursuant to paragraph (2) of subdivision (a) of Section 1684 unless the California bank has been in existence for at least five years. (b) For purposes of this section, a California bank that is established solely for the purpose of, and does not open for business prior to, acquiring the whole business unit of a second California bank through a merger or purchase is deemed to have been in existence for the same period of time as the second California bank. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  33. 1686.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 2. California Branch Offices [1680 - 1688] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    The minimum age requirement in Section 1685 does not apply when subdivision (a) and one of the subdivision (b) conditions are met.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 2. California Branch Offices [1680 - 1688] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1686. The minimum age requirement set forth in Section 1685 does not apply in any case in which the factor set forth in subdivision (a) and any of the factors set forth in subdivision (b) apply. (a) The foreign (other state) bank, by itself or in concurrent transactions with other depository corporations (as defined in Section 4805.06), acquires the whole business unit of the California bank or, if the California bank has been closed or placed in conservatorship, all or substantially all of the insured deposits of the California bank. (b) (1) If the California bank is a national bank, one of the following: (A) The bank is in default or in danger of default, as defined in Section 3(x) of the Federal Deposit Insurance Act (12 U.S.C. Sec. 1813(x)). (B) The purchase or merger is one with respect to which the Federal Deposit Insurance Corporation provides assistance under Section 13(c) of the Federal Deposit Insurance Act (12 U.S.C. Sec. 1823(c)). (2) If the California bank is a state bank, one of the following: (A) The commissioner has taken possession of the property and business of the bank pursuant to Section 592. (B) The purchase or merger is one with respect to which the Federal Deposit Insurance Corporation provides assistance under Section 13(c) of the Federal Deposit Insurance Act (12 U.S.C. Sec. 1823(c)). (C) The commissioner finds that one or more of the factors listed in Section 592 exists and that imposing the minimum age requirement of Section 3825 is not in the public interest. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  34. 1687.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 2. California Branch Offices [1680 - 1688] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    A foreign bank with a California branch office is subject to different California banking rules depending on whether it is a commercial bank, industrial bank, or trust-business bank, and it may not conduct unauthorized or prohibited business at the branch.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 2. California Branch Offices [1680 - 1688] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1687. (a) In case a foreign (other state) state bank that maintains a California branch office is a commercial bank, in addition to other provisions of this division and Division 1 (commencing with Section 99) that are otherwise applicable to the bank, the following provisions of this division apply to the bank with respect to its business in this state as if the bank were a California state commercial bank: (1) Chapter 10 (commencing with Section 1320). (2) Chapter 12 (commencing with Section 1400). (3) Chapter 13 (commencing with Section 1450). (4) Sections 1487, 1488, 1514, 1520, and 1522. (5) Chapter 17 (commencing with Section 1620). (b) In case a foreign (other state) state bank that maintains a California branch office is an industrial bank, in addition to other provisions of this division and Division 1 (commencing with Section 99) that are otherwise applicable to the bank, the provisions cited in paragraphs (1) to (7), inclusive, of subdivision (a) and the provisions of Chapter 15 (commencing with Section 1530) apply to the industrial bank with respect to its business in this state as if the bank were a California state industrial bank. (c) In case a foreign (other state) state bank that maintains a California branch office is authorized pursuant to the law of its domicile to transact trust business, in addition to other provisions of this division and Division 1 (commencing with Section 99) that are otherwise applicable to the bank, the following provisions of Chapter 16 (commencing with Section 1550) apply to the bank with respect to its business in this state as if the bank were a California state bank authorized to transact trust business: (1) Article 3 (commencing with Section 1570). For purposes of Article 3 (commencing with Section 1570), the bank’s principal place of business is deemed to be situated in the city in which its California branch office is located or, if it maintains California branch offices in two or more cities, in the city with the largest population. (2) Article 4 (commencing with Section 1580), except Section 1580. (3) Article 5 (commencing with Section 1600), except Sections 1583, 1584, 1585, 1588, and 1590. (d) Subject to the provisions of subdivision (d), in case a foreign (other state) state bank that maintains a California branch office is authorized pursuant to the law of its domicile to transact trust business, the bank may engage in and conduct trust business in this state and may be appointed by any court to act in any fiduciary capacity in which a California state trust company is authorized to act. (e) No foreign (other state) state bank that maintains a California branch office may transact at the branch office any business that it is not authorized to transact or is prohibited from transacting under the law of its domicile or that banks organized under the laws of this state are not authorized to transact or are prohibited from transacting. (f) Whenever any provision of this chapter or of any regulation or order issued under this chapter that is applicable to or with respect to a foreign (other state) state bank that maintains a California branch office is inconsistent with any provision of any other chapter of this division, the former provision applies, and the latter provision does not apply. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  35. 1688.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 2. California Branch Offices [1680 - 1688] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    A foreign bank without California offices may merge with or buy a foreign bank that already has California offices, and the surviving or purchasing bank may keep those offices and open more.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 2. California Branch Offices [1680 - 1688] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1688. Notwithstanding Section 1684, a foreign (other state) bank that does not maintain offices in California may merge with or purchase the whole business unit of a foreign (other state) bank that already maintains one or more offices in California in accordance with Section 1684 pursuant to federal law and the law of the domicile of the surviving or purchasing bank. The surviving or purchasing bank may retain the offices established in this state by the disappearing or selling bank. Thereafter, the surviving or purchasing bank may establish and maintain additional offices as if it were the disappearing or selling bank. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  36. 169.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 1. Definitions [99 - 217] ( Chapter 1 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    This section defines “disappearing” for a corporation as a constituent corporation that is not the surviving corporation.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 1. Definitions [99 - 217] ( Chapter 1 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 169. “Disappearing,” when used with respect to a corporation, means a constituent corporation that is not the surviving corporation. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  37. 16900.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 9. Enforcement [16900 - 16906] ( Article 9 added by Stats. 2000, Ch. 612, Sec. 4. )

    Verify source ↗

    The commissioner may sue to stop violations, force compliance, or collect penalties and other liabilities under this division or related regulations and orders.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 9. Enforcement [16900 - 16906] ( Article 9 added by Stats. 2000, Ch. 612, Sec. 4. ) ## 16900. (a) The commissioner may bring an action in the name of the people of this state in the superior court to enjoin any violation of, to enforce compliance with, or to collect any penalty or other liability imposed under this division or any regulation or order issued under this chapter. Upon a proper showing, a permanent or preliminary injunction, restraining order, or writ of mandate shall be granted, and a monitor, receiver, conservator, or other designated fiduciary or officer of the court may be granted as appropriate. (b) A receiver, monitor, conservator, or other designated fiduciary officer of the court appointed by the court pursuant to this section may, with the approval of the court, exercise all of the powers of the defendant’s officers, directors, partners, trustees, or persons who exercise similar powers and perform similar duties, including the filing of a petition for bankruptcy. No action at law or in equity may be maintained by any party against the commissioner, or a receiver, monitor, conservator, or other designated fiduciary or officer of the court by reason of their exercising these powers or performing these duties pursuant to the order of, or with the approval of, the court. (c) If the commissioner finds that it is in the public interest, the commissioner may include in a claim for restitution, disgorgement, or damages on behalf of the person injured by the act or practice constituting the subject matter of the action, and the court shall have jurisdiction to award ancillary relief. (d) The provisions of this section that authorize the commissioner to bring actions and seek relief are not intended to, and do not, affect any right that any other person may have to bring the same or similar actions or to seek the same or similar relief. (Added by Stats. 2000, Ch. 612, Sec. 4. Effective January 1, 2001.)
  38. 16900.5.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 9. Enforcement [16900 - 16906] ( Article 9 added by Stats. 2000, Ch. 612, Sec. 4. )

    Verify source ↗

    The commissioner may order a person to stop violating Section 16020, and the person can ask for a hearing and later seek judicial review.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 9. Enforcement [16900 - 16906] ( Article 9 added by Stats. 2000, Ch. 612, Sec. 4. ) ## 16900.5. (a) If the commissioner finds that any person has violated, or that there is reasonable cause to believe that any person is about to violate, Section 16020, the commissioner may order the person to cease and desist from the violation unless and until the person is issued a license. (b) (1) Within 30 days after an order is issued pursuant to subdivision (a), the person to whom the order is directed may file with the commissioner an application for a hearing on the order. If the commissioner fails to commence a hearing within 15 business days after the application is filed with him or her (or within such longer period to which the person consents), the order shall be deemed rescinded. At the hearing the commissioner shall affirm, modify, or rescind the order. (2) The right of any person, to whom an order is issued under subdivision (a), to petition for judicial review of the order shall not be affected by the failure of the person to apply to the commissioner for a hearing on the order pursuant to paragraph (1). (Added by Stats. 2000, Ch. 612, Sec. 4. Effective January 1, 2001.)
  39. 16901.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 9. Enforcement [16900 - 16906] ( Article 9 added by Stats. 2000, Ch. 612, Sec. 4. )

    Verify source ↗

    After notice and hearing, the commissioner may order a person who violated this chapter, or a related regulation or order, to pay a civil penalty under Section 216.3.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 9. Enforcement [16900 - 16906] ( Article 9 added by Stats. 2000, Ch. 612, Sec. 4. ) ## 16901. If, after notice and hearing, the commissioner finds that any person has violated any provision of this chapter or of any regulation or order issued under this chapter, the commissioner may order the person to pay to the commissioner a civil penalty imposed pursuant to Section 216.3. (Amended by Stats. 2003, Ch. 445, Sec. 17. Effective January 1, 2004.)
  40. 16902.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 9. Enforcement [16900 - 16906] ( Article 9 added by Stats. 2000, Ch. 612, Sec. 4. )

    Verify source ↗

    After notice and hearing, the commissioner may suspend or revoke a foreign credit union’s license if specified grounds are found.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 9. Enforcement [16900 - 16906] ( Article 9 added by Stats. 2000, Ch. 612, Sec. 4. ) ## 16902. If, after notice and hearing, the commissioner finds any of the following with respect to a foreign (other nation) credit union that is licensed to maintain an office, the commissioner may issue an order suspending or revoking the license of the foreign (other nation) credit union. (a) That the foreign (other nation) credit union has violated a provision of this division or of any regulation or order issued under this division or a provision of any other applicable law, regulation, or order. (b) That the foreign (other nation) credit union is transacting the business in this state or elsewhere in an unsafe or unsound manner. (c) That the foreign (other nation) credit union is in unsafe or unsound condition. (d) That the foreign (other nation) credit union has ceased to operate its office. (e) That the foreign (other nation) credit union is insolvent in that it has ceased to pay its debts in the ordinary course of business, it cannot pay its debts as they become due, or its liabilities exceed its assets. (f) That the foreign (other nation) credit union has suspended payment of its obligations, has made an assignment for the benefit of its creditors, or has admitted in writing its inability to pay its debts as they become due. (g) That the foreign (other nation) credit union is the subject of an order for relief in bankruptcy or has sought other relief under any bankruptcy, reorganization, insolvency, or moratorium law, or that any person has applied for such relief under any such law against the foreign (other nation) credit union, and the foreign (other nation) credit union has by any affirmative act approved of or consented to the action or the relief has been granted. (h) That a receiver, liquidator, or conservator has been appointed for the foreign (other nation) credit union or that any proceeding for an appointment or any similar proceeding has been initiated in the home country of the foreign (other nation) credit union. (i) That the existence of the foreign (other nation) credit union or the authority of the foreign (other nation) credit union to transact banking business under the laws of the home country of the foreign (other nation) credit union has been suspended or terminated. (j) That any fact or condition exists that, if it had existed at the time when the foreign (other nation) credit union applied for approval to transact business in this state, would have been grounds for denying the application. (Amended by Stats. 2009, Ch. 500, Sec. 39. (AB 1059) Effective January 1, 2010.)
  41. 16903.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 9. Enforcement [16900 - 16906] ( Article 9 added by Stats. 2000, Ch. 612, Sec. 4. )

    Verify source ↗

    The commissioner may suspend or revoke a foreign credit union’s license in certain cases. The credit union may request a hearing, and the commissioner must act within set deadlines or the order is rescinded.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 9. Enforcement [16900 - 16906] ( Article 9 added by Stats. 2000, Ch. 612, Sec. 4. ) ## 16903. (a) If the commissioner finds that any of the factors set forth in Section 16902 is true with respect to any foreign (other nation) credit union that is licensed to maintain an office and that it is necessary for the protection of the interests of creditors of the foreign (other nation) credit union’s business in this state or, in any case, for the protection of the public interest that the commissioner immediately suspend or revoke the license of the foreign (other nation) credit union, the commissioner may issue an order suspending or revoking the license of the foreign (other nation) credit union. (b) (1) Within 30 days after an order is issued pursuant to subdivision (a), the foreign (other nation) credit union to which the order is issued may file with the commissioner an application for a hearing on the order. If the commissioner fails to commence the hearing within 15 business days after the application is filed with the commissioner (or within any longer period to which the foreign (other nation) credit union consents), the order shall be deemed rescinded. Within 30 days after the hearing, the commissioner shall affirm, modify, or rescind the order; otherwise, the order shall be deemed rescinded. (2) The right of any foreign (other nation) credit union to which an order is issued under subdivision (a) to petition for judicial review of the order shall not be affected by the failure of the foreign (other nation) credit union to apply to the commissioner for a hearing on the order pursuant to paragraph (1). (Added by Stats. 2000, Ch. 612, Sec. 4. Effective January 1, 2001.)
  42. 16904.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 9. Enforcement [16900 - 16906] ( Article 9 added by Stats. 2000, Ch. 612, Sec. 4. )

    Verify source ↗

    A foreign credit union whose office license is suspended or revoked must immediately surrender the license to the commissioner.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 9. Enforcement [16900 - 16906] ( Article 9 added by Stats. 2000, Ch. 612, Sec. 4. ) ## 16904. Any foreign (other nation) credit union whose license to maintain an office is suspended or revoked shall immediately surrender the license to the commissioner. (Added by Stats. 2000, Ch. 612, Sec. 4. Effective January 1, 2001.)
  43. 16905.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 9. Enforcement [16900 - 16906] ( Article 9 added by Stats. 2000, Ch. 612, Sec. 4. )

    Verify source ↗

    A foreign credit union subject to certain orders may ask the commissioner to modify or rescind the order, and the commissioner may not grant that request unless specific public-interest and compliance findings are made.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 9. Enforcement [16900 - 16906] ( Article 9 added by Stats. 2000, Ch. 612, Sec. 4. ) ## 16905. (a) Any foreign (other nation) credit union to which an order is issued under Section 16902 and 16903 may apply to the commissioner to modify or rescind the order. The commissioner shall not grant the application unless the commissioner finds that it is in the public interest to do so and that it is reasonable to believe that the foreign (other nation) credit union will, if and when it is again authorized to maintain an office, comply with all applicable provisions of this division and of any regulation or order issued under this division. (b) The right of any foreign (other nation) credit union to which an order is issued under Section 16902 or 16903 to petition for judicial review of the order shall not be affected by the failure of the foreign (other nation) credit union to apply to the commissioner pursuant to subdivision (a) to modify or rescind the order. (Added by Stats. 2000, Ch. 612, Sec. 4. Effective January 1, 2001.)
  44. 16906.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 9. Enforcement [16900 - 16906] ( Article 9 added by Stats. 2000, Ch. 612, Sec. 4. )

    Verify source ↗

    The commissioner may take possession of a foreign credit union’s property and business, and the credit union may seek court review within 10 days.

    ## Financial Code - FIN ## DIVISION 5. CREDIT UNIONS [14000 - 16906] ( Division 5 repealed and added by Stats. 1979, Ch. 112. ) ## CHAPTER 12. Foreign (Other Nation) Credit Unions [16500 - 16906] ( Heading of Chapter 12 renumbered from Chapter 11 by Stats. 2002, Ch. 734, Sec. 43. ) ## ARTICLE 9. Enforcement [16900 - 16906] ( Article 9 added by Stats. 2000, Ch. 612, Sec. 4. ) ## 16906. (a) If the commissioner finds that any of the factors set forth in Section 16902 is true with respect to any foreign (other nation) credit union which is authorized to transact business in this state and that it is necessary for the protection of the interests of the creditors of the business of the foreign (other nation) credit union in this state or for the protection of the public interest that he or she take immediate possession of the property and business of the foreign (other nation) credit union, the commissioner may by order forthwith take possession of the property and business of the foreign (other nation) credit union and retain possession until the foreign (other nation) credit union resumes business in this state or is finally liquidated. The foreign (other nation) credit union may, with the consent of the commissioner, resume business in this state under the conditions as the commissioner may prescribe. (b) (1) Whenever the commissioner takes possession of the property and business of a foreign (other nation) credit union pursuant to subdivision (a), the foreign (other nation) credit union may, within 10 days, apply to the superior court in the county in which the primary office in this state of the foreign (other nation) credit union is located to enjoin further proceedings. The court may, after citing the commissioner to show cause why further proceedings should not be enjoined and after a hearing, dismiss the application or enjoin the commissioner from further proceedings and order him or her to surrender the property and business of the foreign (other nation) credit union to the foreign (other nation) credit union or make any further order as may be just. (2) The judgment of the court may be appealed by the commissioner or by the foreign (other nation) credit union in the manner provided by law for appeals from the judgment of a superior court to the court of appeal. In case the commissioner appeals the judgment of the court, the appeal shall operate as a stay of the judgment, and the commissioner shall not be required to post any bond. (c) Whenever the commissioner takes possession of the property and business of a foreign (other nation) credit union pursuant to subdivision (a), the commissioner shall conserve or liquidate the property and business of the foreign (other nation) credit union in accordance with Sections 14301 to 14304, inclusive. (d) When the commissioner has completed the liquidation of the property and business of a foreign (other nation) credit union in this state, the commissioner shall transfer any remaining assets to the foreign (other nation) credit union in accordance with any order the court may issue. However, in case the foreign (other nation) credit union has an office in another state of the United States which is in liquidation and the assets of that office appear to be insufficient to pay in full the creditors of that office, the court shall order the commissioner to transfer to the liquidator of that office the amount of any remaining assets as appears to be necessary to cover the insufficiency. If there are two or more offices and the amount of remaining assets is less than the aggregate amount of insufficiencies with respect to those offices, the court shall order the commissioner to distribute the remaining assets among the liquidators of the offices in the manner as the court determines is equitable. (Added by Stats. 2000, Ch. 612, Sec. 4. Effective January 1, 2001.)
  45. 17.

    ## Financial Code - FIN ## GENERAL PROVISIONS ( General Provisions enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    This section says that “signature” or “subscription” includes a mark.

    ## Financial Code - FIN ## GENERAL PROVISIONS ( General Provisions enacted by Stats. 1951, Ch. 364. ) ## 17. “Signature” or “subscription” includes mark. The mark shall be made as required in the Civil Code. (Enacted by Stats. 1951, Ch. 364.)
  46. 1700.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 3. Facilities of Insured Foreign (Other State) Banks [1700 - 1705] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    This article does not apply to an insured foreign (other state) bank that maintains a California branch office.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 3. Facilities of Insured Foreign (Other State) Banks [1700 - 1705] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1700. No provision of this article applies to an insured foreign (other state) bank that maintains a California branch office. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  47. 17000.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    This section says Division 6 may be cited as the “Escrow Law.”

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. ) ## 17000. This division is known and may be cited as the “Escrow Law.” (Enacted by Stats. 1951, Ch. 364.)
  48. 17001.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    This section says the chapter’s definitions control how this division is read, unless the context requires otherwise.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. ) ## 17001. Unless the context otherwise requires, the definitions set forth in this chapter govern the construction of this division. (Enacted by Stats. 1951, Ch. 364.)
  49. 17002.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    This section defines “Commissioner” as the Commissioner of Financial Protection and Innovation.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. ) ## 17002. “Commissioner” means the Commissioner of Financial Protection and Innovation. (Amended by Stats. 2022, Ch. 452, Sec. 118. (SB 1498) Effective January 1, 2023.)
  50. 17002.5.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    This section defines “Person” to include the singular and several kinds of entities, including companies, partnerships, corporations, LLCs, and other legal entities.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. ) ## 17002.5. “Person” means, in addition to the singular, persons, group of persons, co-operative, association, company, firm, partnership, corporation, limited liability company, or other legal entity. (Amended by Stats. 1994, Ch. 1010, Sec. 114. Effective January 1, 1995.)
  51. 17003.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    This section defines “escrow,” including certain Internet escrow transactions.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. ) ## 17003. (a) “Escrow” means any transaction in which one person, for the purpose of effecting the sale, transfer, encumbering, or leasing of real or personal property to another person, delivers any written instrument, money, evidence of title to real or personal property, or other thing of value to a third person to be held by that third person until the happening of a specified event or the performance of a prescribed condition, when it is then to be delivered by that third person to a grantee, grantor, promisee, promisor, obligee, obligor, bailee, bailor, or any agent or employee of any of the latter. (b) With regard to Internet escrow companies, “escrow” also includes any transaction in which one person, for the purpose of effecting the sale or transfer of personal property or services to another person, delivers money, or its Internet-authorized equivalent, to a third person to be held by that third person until the happening of a specified event or the performance of a prescribed condition, when it is then to be delivered by that third person to a grantee, grantor, promisee, promisor, obligee, obligor, bailee, bailor, or any agent or employee of any of the latter. (Amended by Stats. 2000, Ch. 437, Sec. 1. Effective January 1, 2001.)
  52. 17004.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    “Escrow agent” means a person engaged in the business of receiving escrows for deposit or delivery.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. ) ## 17004. “Escrow agent” means any person engaged in the business of receiving escrows for deposit or delivery. (Amended by Stats. 1981, Ch. 773, Sec. 1.)
  53. 17004.5.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    “Internet escrow agent” means a person who receives escrows for deposit or delivery over the Internet.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. ) ## 17004.5. “Internet escrow agent” means any person engaged in the business of receiving escrows for deposit or delivery over the Internet. (Added by Stats. 1999, Ch. 441, Sec. 2. Effective January 1, 2000.)
  54. 17005.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    This section defines “licensee” as a person with a valid, unrevoked escrow agent license.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. ) ## 17005. “Licensee” means any person holding a valid, unrevoked license as an escrow agent. (Enacted by Stats. 1951, Ch. 364.)
  55. 17005.1.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    This section defines “joint control agent” and explains when a person is, and is not, considered to be acting “in the business” for that definition.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. ) ## 17005.1. “Joint control agent” means a person engaging in the business of receiving money or other property for disbursal or use in payment of the cost of labor, materials, services, permits, fees, or other items of expense incurred in the construction of improvements upon real property. As used in this section, “in the business” means the conduct of the aforesaid transaction either for compensation or without compensation as a primary business or as an incidence to another business, but shall not mean the conduct of the business of real estate lending or of acting as an authorized representative, agent or loan correspondent for such a lender. (Added by Stats. 1965, Ch. 287.)
  56. 17005.2.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    This section defines “business location” and “business office location” for escrow agents.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. ) ## 17005.2. “Business location” and “business office location” mean a facility or other place of business where a person engages in the business of receiving an escrow for deposit or delivery, but does not include a customer contact center. (Added by Stats. 2000, Ch. 437, Sec. 2. Effective January 1, 2001.)
  57. 17005.3.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    This section defines “customer contact center” for an Internet escrow agent.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. ) ## 17005.3. “Customer contact center” means a facility operated by an Internet escrow agent that exists solely for the purpose of responding to customer electronic messages and telephone inquiries; provided, that no receipt or disbursements relating to an escrow are made from the facility; and provided further, that any documentation or other material generated, transmitted, or otherwise sent from the facility can be reviewed at any time from the business location of the Internet escrow agent. (Added by Stats. 2000, Ch. 437, Sec. 3. Effective January 1, 2001.)
  58. 17005.4.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    This section defines “Person subject to this division” as anyone performing escrow agent services, unless specifically exempted under Section 17006.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. ) ## 17005.4. “Person subject to this division” means any person undertaking the performance of escrow agent services. Unless specifically exempted, as in Section 17006, however, this definition shall not be used to exclude anyone. (Added by renumbering Section 17005.3 (as renumbered from 17005.5 by Stats. 1999, Ch. 441) by Stats. 2002, Ch. 772, Sec. 10. Effective January 1, 2003.)
  59. 17005.5.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    This section defines when activity is considered “within this state” for escrow-related conduct.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. ) ## 17005.5. “Within this state” means any activity of a person relating to receiving escrows for deposit or delivery that originates from this state and is directed to persons outside this state, or that originates from outside this state and is directed to persons inside this state, or that originates inside this state and is directed to persons inside this state, or that leads to the formation of a contract and the offer or acceptance thereof is directed to a person in this state, whether from inside or outside this state and whether the offer was made inside or outside this state. (Added by Stats. 1999, Ch. 441, Sec. 4. Effective January 1, 2000.)
  60. 17005.6.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    For this division, “escrow agent” includes joint control agents and Internet escrow agents, except as provided in Section 17004.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. ) ## 17005.6. Except as provided for in Section 17004, “escrow agent” as used in this division includes joint control agents and Internet escrow agents. (Amended by Stats. 1999, Ch. 441, Sec. 5. Effective January 1, 2000.)
  61. 17006.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    This section says the division does not apply to several listed categories, including certain financial institutions, qualifying California lawyers, certain title-search businesses, and some licensed real estate brokers. The lawyer and broker exemptions are personal and cannot be delegated except under direct supervision, and they do not apply to arrangements for escrows for more than one business.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. ) ## 17006. (a) This division does not apply to: (1) Any person doing business under any law of this state or the United States relating to banks, trust companies, building and loan or savings and loan associations, credit unions, or insurance companies. (2) Any person licensed to practice law in California who has a bona fide client relationship with a principal in a real estate or personal property transaction and who is not actively engaged in the business of an escrow agent. (3) Any person whose principal business is that of preparing abstracts or making searches of title that are used as a basis for the issuance of a policy of title insurance by a company doing business under any law of this state relating to insurance companies. (4) Any broker licensed by the Real Estate Commissioner while performing acts in the course of or incidental to a real estate transaction in which the broker is an agent or a party to the transaction and in which the broker is performing an act for which a real estate license is required. (b) The exemptions provided for in paragraphs (2) and (4) of subdivision (a) are personal to the persons listed, and those persons shall not delegate any duties other than duties performed under the direct supervision of those persons. Notwithstanding the provisions of this subdivision, the exemptions provided for in paragraphs (2) and (4) of subdivision (a) are not available for any arrangement entered into for the purpose of performing escrows for more than one business. (Amended by Stats. 2018, Ch. 267, Sec. 9. (AB 2862) Effective January 1, 2019.)
  62. 17006.5.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    If someone claims an exemption or exception from a definition in a proceeding under this law, that person must prove it.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. ) ## 17006.5. In any proceeding under this law, the burden of proving an exemption or an exception from a definition is upon the person claiming it. (Added by Stats. 1978, Ch. 778.)
  63. 17008.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    A foreign corporation may not conduct escrow business in this state unless it follows the division’s requirements and files a written instrument appointing the commissioner as its attorney for service of process.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. ) ## 17008. No foreign corporation shall transact any escrow business in this State without first complying with all the requirements of this division, nor until it has executed and filed with the commissioner a written instrument appointing the commissioner its attorney upon whom all process in any action or proceeding by any resident of this State against it may be served with the same force and effect as if such corporation were formed under the laws of this State, and had been lawfully served with process in this State. Service of process by a resident of this State upon the commissioner constitutes personal service on the foreign corporation. (Amended by Stats. 1961, Ch. 475.)
  64. 17009.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    The commissioner must mail a copy of every paper served under this chapter by prepaid registered mail to the corporation’s secretary at the last known post-office address on file with the commissioner.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. ) ## 17009. The commissioner shall forward by prepaid registered mail a copy of every paper served under this chapter, to the secretary of the corporation at its last known post-office address as shown by the records and reports of the corporation filed in the office of the commissioner. (Enacted by Stats. 1951, Ch. 364.)
  65. 1701.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 3. Facilities of Insured Foreign (Other State) Banks [1700 - 1705] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    An insured foreign bank may not open or keep an office in this state for noncore banking business unless it complies with this article and Article 1; a person also may not open or keep an office here as the bank’s representative unless the bank complies.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 3. Facilities of Insured Foreign (Other State) Banks [1700 - 1705] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1701. (a) No insured foreign (other state) bank may establish or maintain an office in this state at which it engages in noncore banking business unless the bank complies with this article and applicable provisions of Article 1 (commencing with Section 1670). (b) (1) No person may establish or maintain an office in this state as representative of an insured foreign (other state) bank unless the bank complies with this article and applicable provisions of Article 1 (commencing with Section 1670). (2) For purposes of this article, if any person establishes or maintains an office in this state as representative of an insured foreign (other state) bank, the insured foreign (other state) bank is deemed to establish and maintain the office as a facility. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  66. 17010.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    The commissioner must collect $2 from the plaintiff for each copy of process served, at the time of service.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 1. Application of This Division [17000 - 17010] ( Chapter 1 enacted by Stats. 1951, Ch. 364. ) ## 17010. The commissioner shall collect from the plaintiff at the time of service, the sum of two dollars ($2) for each copy of process served on him pursuant to this chapter. This sum shall be recovered by the plaintiff as part of his taxable costs, if he succeeds in the suit or proceeding. (Enacted by Stats. 1951, Ch. 364.)
  67. 1702.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 3. Facilities of Insured Foreign (Other State) Banks [1700 - 1705] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    An insured foreign (other state) bank must file a report and the Section 1703 appointment with the commissioner at least 30 days before establishing a facility.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 3. Facilities of Insured Foreign (Other State) Banks [1700 - 1705] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1702. Not less than 30 days before an insured foreign (other state) bank establishes a facility, the bank shall file with the commissioner a report and the appointment required pursuant to Section 1703. (Amended by Stats. 2013, Ch. 334, Sec. 41. (SB 537) Effective January 1, 2014.)
  68. 1703.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 3. Facilities of Insured Foreign (Other State) Banks [1700 - 1705] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    An insured foreign bank must file an appointment with the commissioner at least 30 days before establishing a facility. If an uninsured foreign bank is served with process, the service is only effective if notice, a copy of the process, and an affidavit of compliance are timely completed.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 3. Facilities of Insured Foreign (Other State) Banks [1700 - 1705] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1703. (a) Not less than 30 days before establishing a facility, an insured foreign (other state) bank shall file with the commissioner, in the form that the commissioner may by regulation or order require, an appointment irrevocably appointing the commissioner and the commissioner’s successor from time to time in office to be the bank’s attorney to receive service of any lawful process in any noncriminal judicial or administrative proceeding against the bank or any of its successors that arises out of the activities in this state of the facility after the appointment has been filed, with the same force and validity as if served personally on the bank or its successors, as the case may be. (b) Any insured foreign (other state) bank that maintains a facility and that has not filed with the commissioner an appointment pursuant to subdivision (a) is deemed by the maintenance of the facility to have appointed the commissioner as its attorney to receive service of any lawful process in any noncriminal judicial or administrative proceeding against the bank or any of its successors that arises out of the activities in this state of the facility, with the same force and validity as if served personally on the bank or its successor, as the case may be. (c) Service may be made on an uninsured foreign (other state) bank that has appointed or is deemed to have appointed the commissioner as its attorney for service of process by leaving a copy of the process at any office of the commissioner. However, the service is not effective unless (1) the party making the service, who may be the commissioner, forthwith sends notice of the service and a copy of the process by registered or certified mail to the bank served at the last address on file with the commissioner for any of the bank’s offices in this state or at its head office, and (2) an affidavit of compliance with this subdivision by the party making the service is filed in the case on or before the return date, if any, or within any further time that the court, in the case of a judicial proceeding, or the administrative agency, in the case of an administrative proceeding, allows. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  69. 1704.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 3. Facilities of Insured Foreign (Other State) Banks [1700 - 1705] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    An insured foreign (other state) bank must file a report with the commissioner at least 30 days before relocating a facility.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 3. Facilities of Insured Foreign (Other State) Banks [1700 - 1705] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1704. Not less than 30 days before an insured foreign (other state) bank relocates a facility, it shall file a report with the commissioner. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  70. 1705.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 3. Facilities of Insured Foreign (Other State) Banks [1700 - 1705] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    An insured foreign (other state) bank must file a report with the commissioner at least 30 days before closing a facility.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 3. Facilities of Insured Foreign (Other State) Banks [1700 - 1705] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1705. Not less than 30 days before an insured foreign (other state) bank closes a facility, it shall file a report with the commissioner. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  71. 171.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 1. Definitions [99 - 217] ( Chapter 1 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    This section defines “distribution to its shareholders” and creates exceptions for certain bank share purchases.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 1. Definitions [99 - 217] ( Chapter 1 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 171. “Distribution to its shareholders” has the meaning set forth in Section 166 of the Corporations Code. However, in Division 1 (commencing with Section 100), Title 1 of the Corporations Code, in this division, and in Division 1.1 (commencing with Section 1000), “distribution to its shareholders” does not include any purchase of shares by a bank or by a majority-owned subsidiary of a bank which is necessary to reduce or avoid loss to such bank or to such subsidiary on an extension of credit previously made in good faith. Also, in this division and in Division 1.1 (commencing with Section 1000), “distribution to its shareholders” includes any distribution made by a bank or by a majority-owned subsidiary of a bank to the shareholders of any corporation of which such bank is a majority-owned subsidiary. (Amended by Stats. 2013, Ch. 334, Sec. 11. (SB 537) Effective January 1, 2014.)
  72. 1710.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 4. Facilities of Uninsured Foreign (Other State) Banks [1710 - 1721] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    This section defines key terms used in the article, including “controlling person,” “executive officer,” “license,” and “licensed.”

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 4. Facilities of Uninsured Foreign (Other State) Banks [1710 - 1721] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1710. In this article, unless the context otherwise requires: (a) “Controlling person,” when used with respect to an uninsured foreign (other state) bank, means any person who directly or indirectly controls the bank. For purposes of this subdivision, “control” has the meaning set forth in subdivision (b) of Section 1250, and “person” has the meaning set forth in subdivision (d) of Section 1250. (b) “Executive officer,” when used with respect to an uninsured foreign (other state) bank or a controlling person of an uninsured foreign (other state) bank, means the chief executive officer, the chief operating officer, the chief financial officer, and any other person who participates or has authority to participate in major policymaking functions of the bank or controlling person. (c) (1) “License” means a license issued under this article, authorizing an uninsured foreign (other state) bank to maintain a facility. (2) “Licensed” means to be issued or to hold a license. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  73. 1711.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 4. Facilities of Uninsured Foreign (Other State) Banks [1710 - 1721] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    For facility-approval findings, the commissioner may presume certain bank-related persons are of good character and sound financial standing unless there is credible evidence otherwise, and may find them not of good character based on listed conduct or other grounds.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 4. Facilities of Uninsured Foreign (Other State) Banks [1710 - 1721] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1711. (a) In this section, “act” includes (without limitation) omission. (b) For purposes of making findings on an application by an uninsured foreign (other state) bank for approval to establish a facility: (1) The commissioner may, in the absence of credible evidence to the contrary, presume that the directors, executive officers, and any controlling person of the bank, the directors and executive officers of any controlling person of the bank, and the members of the proposed management of the facility are each of good character and sound financial standing. (2) The commissioner may find that the bank, a director, executive officer, or controlling person of the bank, a director or executive officer of a controlling person of the bank, or any member of the proposed management of the facility is not of good character if the person has done any of the following: (A) Has been convicted of, or has pleaded nolo contendere to, any crime involving an act of fraud or dishonesty. (B) Has consented to or suffered a judgment in any civil action based upon conduct involving an act of fraud or dishonesty. (C) Has consented to or suffered the suspension or revocation of any professional, occupational, or vocational license based upon conduct involving an act of fraud or dishonesty. (D) Has willfully made or caused to be made in any application or report filed with the commissioner or in any proceeding before the commissioner any statement that was at the time and in the light of the circumstances under which it was made false or misleading with respect to any material fact, or has willfully omitted to state in any such application or report any material fact that was required to be stated in the application or report. (E) Has willfully committed any violation of, or has willfully aided, abetted, counseled, commanded, induced, or procured the violation by any other person of, any provision of this division or of any regulation or order issued under this division. (c) Paragraph (2) of subdivision (b) is not an exclusive list of the grounds upon which the commissioner may find, for purposes of making findings on an application by an uninsured foreign (other state) bank for approval to establish a facility, that the bank, a director, executive officer, or controlling person of the bank, a director or executive officer of a controlling person of the bank, or any member of the proposed management of the facility is not of good character. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  74. 1712.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 4. Facilities of Uninsured Foreign (Other State) Banks [1710 - 1721] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    An uninsured foreign bank may not establish or keep an office in this state for noncore banking business unless it is licensed to maintain the office as a facility. A person may not establish or keep an office here as a representative of such a bank unless that bank is licensed.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 4. Facilities of Uninsured Foreign (Other State) Banks [1710 - 1721] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1712. (a) No uninsured foreign (other state) bank may establish or maintain an office in this state at which it engages in noncore banking business unless the uninsured foreign (other state) bank is licensed to maintain the office as a facility. (b) (1) No person may establish or maintain an office in this state as representative of an uninsured foreign (other state) bank unless the uninsured foreign (other state) bank is licensed to maintain the office as a facility. (2) For purposes of this article, if any person establishes or maintains an office in this state as representative of an uninsured foreign (other state) bank, the uninsured foreign (other state) bank is deemed to establish and maintain the office as a facility. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  75. 1713.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 4. Facilities of Uninsured Foreign (Other State) Banks [1710 - 1721] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    An uninsured foreign (other state) bank may not establish or maintain a facility unless the commissioner first approves the office and issues a license.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 4. Facilities of Uninsured Foreign (Other State) Banks [1710 - 1721] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1713. (a) No uninsured foreign (other state) bank may establish or maintain a facility unless the commissioner has first approved the establishment of the office and issued a license authorizing the bank to maintain the office. (b) If the commissioner finds all the following with respect to an application by an uninsured foreign (other state) bank for approval to establish a facility, the commissioner shall approve the application: (1) The bank, any controlling person of the bank, the directors and executive officers of the bank or of any controlling person of the bank, and the proposed management of the office are each of good character and sound financial standing. (2) The financial history and condition of the bank are satisfactory. (3) The management of the bank and the proposed management of the office are adequate. (4) It is reasonable to believe that, if licensed to maintain the office, the bank will operate the office in compliance with all applicable laws, regulations, and orders. (5) The bank’s establishment and maintenance of the office will promote the public convenience and advantage. (6) The activities in which the bank proposes to engage at the office are noncore banking business and do not constitute core banking business. If the commissioner finds otherwise, the commissioner shall deny the application. (c) Whenever an application by an uninsured foreign (other state) bank for approval to establish a facility has been approved and all conditions precedent to the issuance of a license authorizing the bank to maintain the office have been fulfilled, the commissioner shall issue the license. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  76. 1714.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 4. Facilities of Uninsured Foreign (Other State) Banks [1710 - 1721] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    An uninsured foreign bank licensed to maintain a facility may not move its office unless the commissioner approves the move and issues a new license.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 4. Facilities of Uninsured Foreign (Other State) Banks [1710 - 1721] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1714. (a) No uninsured foreign (other state) bank that is licensed to maintain a facility may relocate the office unless the commissioner has first approved the relocation and issued a license authorizing the bank to maintain the office at the new site. (b) If the commissioner finds the following with respect to an application by an uninsured foreign (other state) bank for approval to relocate a facility, the commissioner shall approve the application: (1) In case the new site of the office is in the same vicinity as the old site, that the relocation of the office will not be substantially detrimental to the public convenience. (2) In case the new site of the office is not in the same vicinity as the old site, both of the following: (A) The relocation of the office from the old site will not be substantially detrimental to the public convenience and advantage in the area that is primarily served by the office at the old site. (B) The relocation of the office to the new site will promote the public convenience and advantage. If the commissioner finds otherwise, the commissioner shall deny the application. (c) Whenever an application by an uninsured foreign (other state) bank for approval to relocate a facility has been approved and all conditions precedent to the issuance of a license authorizing the bank to maintain the office at the new site have been fulfilled, the commissioner shall issue the license. (d) Promptly after an uninsured foreign (other state) bank that is licensed to maintain a facility relocates the office, the bank shall surrender to the commissioner the license that authorized it to maintain the office at the old site. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  77. 1715.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 4. Facilities of Uninsured Foreign (Other State) Banks [1710 - 1721] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    An uninsured foreign bank licensed to maintain a facility may do noncore banking business at the office, but it may not do core banking business there.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 4. Facilities of Uninsured Foreign (Other State) Banks [1710 - 1721] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1715. An uninsured foreign (other state) bank that is licensed to maintain a facility may, subject to any regulations that the commissioner may prescribe, engage in any noncore banking business at the office but may not solicit deposits, receive deposits, pay checks, make loans, or otherwise conduct core banking business at the office. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  78. 1716.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 4. Facilities of Uninsured Foreign (Other State) Banks [1710 - 1721] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    An uninsured foreign bank licensed to maintain a facility may not close the office without the commissioner’s prior approval, unless it is closing under Section 1717.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 4. Facilities of Uninsured Foreign (Other State) Banks [1710 - 1721] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1716. (a) (1) No uninsured foreign (other state) bank that is licensed to maintain a facility may close the office unless the commissioner has first approved the closing. (2) Paragraph (1) does not prohibit an uninsured foreign (other state) bank that is licensed to maintain a facility from closing the office in accordance with Section 1717. (b) If the commissioner finds, with respect to an application by an uninsured foreign (other state) bank for approval to close a facility, that the closing of the office will not be substantially detrimental to the public convenience and advantage, the commissioner shall approve the application. If the commissioner finds otherwise, the commissioner shall deny the application. (c) Whenever an application by an uninsured foreign (other state) bank for approval to close a facility has been approved and all conditions precedent to the closing have been fulfilled, the bank may close the office and shall promptly thereafter surrender to the commissioner the license that authorized it to maintain the office. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  79. 1717.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 4. Facilities of Uninsured Foreign (Other State) Banks [1710 - 1721] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    An uninsured foreign bank may surrender a facility license by filing the license and a report with the commissioner, but if it holds two or more facility licenses it cannot surrender only some of them.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 4. Facilities of Uninsured Foreign (Other State) Banks [1710 - 1721] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1717. (a) Any uninsured foreign (other state) bank that holds a license to maintain a facility may voluntarily surrender the license by filing the license and a report with the commissioner. However, any uninsured foreign (other state) bank that holds licenses to maintain two or more facilities may not voluntarily surrender fewer than all of the licenses. (b) (1) Except as provided in paragraph (2), a voluntary surrender of a license is effective on the 30th day after the license and the report called for in subdivision (a) are filed with the commissioner, or on any earlier date that the commissioner may by order specify. (2) If a proceeding to revoke or suspend a license is pending when the license and the report called for in subdivision (a) are filed with the commissioner, or if a proceeding to revoke or suspend a license or to impose conditions upon the surrender of a license is instituted before the 30th day after the license and the report called for in subdivision (a) are filed with the commissioner, the voluntary surrender of the license is effective at the time and upon the conditions that the commissioner may by order specify. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  80. 1718.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 4. Facilities of Uninsured Foreign (Other State) Banks [1710 - 1721] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    An uninsured foreign bank must file an appointment with the commissioner before it can get a license to maintain a facility, and service of process rules apply to banks that maintain a facility.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 4. Facilities of Uninsured Foreign (Other State) Banks [1710 - 1721] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1718. (a) (1) No uninsured foreign (other state) bank may be issued a license to maintain a facility unless it has first filed with the commissioner, in the form that the commissioner may by regulation or order require, an appointment irrevocably appointing the commissioner and the commissioner’s successor from time to time in office as the bank’s attorney to receive service of process in any noncriminal judicial or administrative proceeding against the bank or any of its successors that arises out of the activities in this state of the facility after the appointment has been filed, with the same force and validity as if served personally on the bank or its successors, as the case may be. (2) Any uninsured foreign (other state) bank that maintains a facility and that has not filed with the commissioner an appointment pursuant to paragraph (1) is deemed by the maintenance of the facility to have appointed the commissioner and the commissioner’s successor from time to time in office as its attorney to receive service of any lawful process in a noncriminal judicial or administrative proceeding against the bank or any of its successors that arises out of the activities in this state of the facility with the same force and validity as if served personally on the bank or its successors, as the case may be. (b) Service may be made on an uninsured foreign (other state) bank that has appointed or is deemed to have appointed the commissioner as its attorney for service of process by leaving a copy of the process at an office of the commissioner. However, the service is not effective unless (1) the party making the service, who may be the commissioner, forthwith sends notice of the service and a copy of the process by registered or certified mail to the bank served at the last address on file with the commissioner for any of its offices in this state or at its head office, and (2) an affidavit of compliance with this subdivision by the party making the service is filed in the case on or before the return date, if any, or within any further time that the court, in the case of a judicial proceeding, or the administrative agency, in the case of an administrative proceeding, allows. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  81. 1719.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 4. Facilities of Uninsured Foreign (Other State) Banks [1710 - 1721] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    An uninsured foreign bank licensed to maintain a facility must give the office a popular name including “facility” and post that name and the bank’s name at the office.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 4. Facilities of Uninsured Foreign (Other State) Banks [1710 - 1721] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1719. Each uninsured foreign (other state) bank that is licensed to maintain a facility shall assign to the office a popular name that includes the term “facility” and that consists of a specific designation by name or number. The bank shall post the popular name and the name of the bank in a conspicuous place at the office. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  82. 1720.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 4. Facilities of Uninsured Foreign (Other State) Banks [1710 - 1721] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    An uninsured foreign (other state) bank licensed to maintain a facility must post its license in a conspicuous place at the office.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 4. Facilities of Uninsured Foreign (Other State) Banks [1710 - 1721] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1720. Each uninsured foreign (other state) bank that is licensed to maintain a facility shall post its license in a conspicuous place at the office. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  83. 17200.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. )

    Verify source ↗

    A person may not do escrow-agent business in this state unless it is through a corporation formed for that purpose and licensed by the commissioner.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. ) ## 17200. It shall be unlawful for any person to engage in business as an escrow agent within this state except by means of a corporation duly organized for that purpose licensed by the commissioner as an escrow agent. (Amended by Stats. 1999, Ch. 441, Sec. 6. Effective January 1, 2000.)
  84. 17200.8.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. )

    Verify source ↗

    Escrow agent corporations must staff offices with qualified people meeting minimum experience rules, and Internet escrow agents have special staffing and notice duties for personal-property escrows.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. ) ## 17200.8. (a) Within the organization of each escrow agent corporation, either as an owner, officer, or employee, there shall be one or more persons possessing a minimum of five years of responsible escrow or joint control experience to be stationed at the main office of the corporation and one or more persons possessing a minimum of four years of responsible escrow or joint control experience stationed at each branch. At least one such qualified person shall be stationed on duty at each business location licensed by this division during the time the location is open for business. A person who has satisfied educational requirements established by the commissioner may substitute education for up to one year of experience. (b) Subdivision (a) does not apply to an Internet escrow agent with respect to escrows involving personal property. However, within the organization of each Internet escrow agent corporation engaged in the business of an escrow involving personal property, either as an owner, officer, or employee, one or more qualified persons shall possess knowledge and understanding of the Escrow Law (as set forth in Division 6 (commencing with Section 17000)), the rules promulgated thereunder, and accounting so that, among other things, appropriate books and records are used and maintained in order to account for escrows involving personal property. At least one qualified person shall be on duty at each business location of an Internet escrow agent licensed by this division when operations are being conducted that require knowledge of accounting and the Escrow Law and regulations. An Internet escrow agent shall notify the commissioner of the daily business hours during which those operations are to be conducted. (Amended by Stats. 2000, Ch. 437, Sec. 4. Effective January 1, 2001.)
  85. 17201.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. )

    Verify source ↗

    An escrow-agent license application must be in writing, in the commissioner’s prescribed form, and verified by the applicant’s oath.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. ) ## 17201. (a) An application for a license as an escrow agent shall be in writing and in such form as is prescribed by the commissioner. The application shall be verified by the oath of the applicant. (b) Notwithstanding any other law, the commissioner may by rule or order prescribe circumstances under which to accept electronic records or electronic signatures. This section does not require the commissioner to accept electronic records or electronic signatures. (c) For purposes of this section, the following terms have the following meanings: (1) “Electronic record” means an initial license application, or material modification of that license application, and any other record created, generated, sent, communicated, received, or stored by electronic means. “Electronic records” also includes, but is not limited to, all of the following: (A) An application, amendment, supplement, and exhibit, filed for any order, license, consent, or other authority. (B) A financial statement, report, or advertising. (C) An order, license, consent, or other authority. (D) A notice of public hearing, accusation, and statement of issues in connection with any application, registration, order, license, consent, or other authority. (E) A proposed decision of a hearing officer and a decision of the commissioner. (F) The transcripts of a hearing and correspondence between a party and the commissioner directly relating to the record. (G) A release, newsletter, interpretive opinion, determination, or specific ruling. (H) Correspondence between a party and the commissioner directly relating to any document listed in subparagraphs (A) to (G), inclusive. (2) “Electronic signature” means an electronic sound, symbol, or process attached to or logically associated with an electronic record and executed or adopted by a person with the intent to sign the electronic record. (d) The Legislature finds and declares that the Department of Financial Protection and Innovation has continuously implemented methods to accept records filed electronically, and is encouraged to continue to expand its use of electronic filings to the extent feasible, as budget, resources, and equipment are made available to accomplish that goal. (Amended by Stats. 2022, Ch. 452, Sec. 119. (SB 1498) Effective January 1, 2023.)
  86. 17202.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. )

    Verify source ↗

    Escrow license applicants and licensees must provide and keep a bond, or may use an approved irrevocable letter of credit instead.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. ) ## 17202. (a) At the time of filing an application for an escrow agent’s license, the applicant shall deposit with the commissioner a bond satisfactory to the commissioner in the amount of at least twenty-five thousand dollars ($25,000). Thereafter, a licensee shall maintain a bond satisfactory to the commissioner in the amount of: (1) twenty-five thousand dollars ($25,000) if 150 percent of the previous year’s average annual trust fund obligations, as calculated under Section 17348, equals two hundred fifty thousand dollars ($250,000) or less; (2) thirty-five thousand dollars ($35,000) if 150 percent of the previous year’s average annual trust fund obligations, as calculated under Section 17348, equals at least two hundred fifty thousand one dollars ($250,001) but not more than five hundred thousand dollars ($500,000); or (3) fifty thousand dollars ($50,000) if 150 percent of the previous year’s average annual trust fund obligations, as calculated under Section 17348, equals five hundred thousand one dollars ($500,001) or more. The bond shall run to the state for the use of the state and for any person who has cause against the obligor of the bond under the provision of this division. A deposit given instead of the bond required by this section shall not be deemed an asset of the applicant or licensee for the purpose of complying with Section 17210. An applicant or licensee may obtain an irrevocable letter of credit approved by the commissioner in lieu of the bond. (b) Escrow agents licensed prior to January 1, 1986, shall comply with the requirements of subdivision (a) on or before July 1, 1986. (Amended by Stats. 1985, Ch. 1560, Sec. 2. Effective October 2, 1985. Operative January 1, 1986, by Sec. 45 of Ch. 1560.)
  87. 17202.1.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. )

    Verify source ↗

    An escrow-license applicant or licensee may use a cash bond instead of the bond required by Section 17202, and the commissioner controls those deposits until release.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. ) ## 17202.1. An applicant for an escrow agent’s license or a licensee may, in lieu of and subject to the same conditions as the bond required by Section 17202, deposit with the commissioner a cash bond in the sum specified in Section 17202. Evidence of the cash bond shall be a deposit in the amount specified in Section 17202 in a bank or investment certificates of industrial loan companies, authorized to do business in this state and insured by the Federal Deposit Insurance Corporation, or an investment certificate or share account in the amount specified in Section 17202 issued by a savings and loan association doing business in this state and insured by the Federal Deposit Insurance Corporation. Those deposits, certificates, or accounts shall be assigned to and accepted and maintained by the commissioner, upon those terms as the commissioner may prescribe, until released by the commissioner, and shall not be deemed an asset of the applicant or licensee for the purpose of complying with Section 17210. (Amended by Stats. 2022, Ch. 16, Sec. 2. (SB 577) Effective April 28, 2022.)
  88. 17203.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. )

    Verify source ↗

    An escrow agent’s bond must cover the licensee’s compliance, faithful handling of funds, performance of duties, and payment of amounts owed; the surety may instead pay its liability to the commissioner or a conservator and be released.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. ) ## 17203. The bond of an escrow agent shall be conditioned that the licensee will faithfully conform to and abide by the provisions of this division and all the rules made by the commissioner under this division. The bond shall be conditioned that the licensee will honestly and faithfully apply all funds received, will faithfully and honestly perform all obligations and undertakings under this division, and will pay to the state and any person all amounts which become due or owing to the state or to such person under the provisions of this division, including the costs in any conservatorship, or liquidation, whether by the commissioner or by a receiver. In determining the liability of the principal and the sureties under the bond, escrow money held in trust and any money recovered to restore any deficiency in the trust shall not be considered as an asset of the liquidation subject to assessment for the cost of the liquidation. The surety under the bond may pay the full amount of its liability thereunder to the commissioner or a conservator appointed by the commissioner pursuant to Chapter 6 (commencing with Section 17621) in lieu of payment to the state or persons having a cause of action against the principal, and upon such payment the surety is completely released from further liability under the bond. (Amended by Stats. 1982, Ch. 517, Sec. 219.)
  89. 17203.1.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. )

    Verify source ↗

    Certain escrow-agent officers, directors, trustees, employees, and check-drawers must provide a bond before starting or continuing duties, and the commissioner controls the bond’s amount, term, sureties, and any additional bond.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. ) ## 17203.1. (a) All officers, directors, trustees, and employees of an escrow agent, whether or not compensated, who have access to money or negotiable securities belonging to the escrow agent or in the possession of the escrow agent in the regular discharge of their duties, or persons who draw checks upon the escrow agent or upon the trust funds of the escrow agent in the regular discharge of their duties, before entering upon their duties and throughout the entire term of their office and employment and any subsequent term thereof, shall furnish to the escrow agent a bond indemnifying the escrow agent against loss of money or property. No officer, director, trustee, or employee shall enter upon their duties or have access to money or negotiable securities or draw checks upon the escrow agent or the trust funds of an escrow agent prior to complying with such rules as the commissioner shall adopt with respect to the qualifications of these officers, directors, trustees, or employees to assume their duties. The commissioner shall prescribe the aggregate amount of the bond and the terms during which the bond runs. The sufficiency of the sureties on the bond are at all times subject to the approval of the commissioner. The bond shall be filed in the commissioner’s office. The aggregate liability of the surety for all claims shall in no event exceed the penal sum of the bond. (b) The commissioner may at any time require an additional bond or surety to be filed when in the commissioner’s opinion any bond then in force is insufficient for any reason. (Amended by Stats. 1984, Ch. 548, Sec. 1.)
  90. 17205.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. )

    Verify source ↗

    A person may not bring an action on an escrow agent’s bond more than two years after the complained-of act or default.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. ) ## 17205. No action may be brought on an escrow agent’s bond by any person after the expiration of two years from the time when the act or default complained of occurs. (Amended by Stats. 1982, Ch. 517, Sec. 223.)
  91. 17206.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. )

    Verify source ↗

    The commissioner may require a new bond when an action is started on an escrow agent’s bond, and the licensee must file a new bond immediately if any action on the bond is recovered.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. ) ## 17206. When an action is commenced on an escrow agent’s bond the commissioner may require the filing of a new bond, and immediately upon the recovery of any action on the bond, the licensee shall file a new bond. Failure to file a new bond within 10 days of the recovery on a bond, or within 10 days after notification of the commissioner that a new bond is required constitutes sufficient grounds for the suspension or revocation of the license. (Enacted by Stats. 1951, Ch. 364.)
  92. 17207.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. )

    Verify source ↗

    The commissioner charges listed fees and assessments for escrow agent licensing, investigations, hearings, and related filings. Escrow agents must pay annual license fees and special assessments on time, and late payment can trigger penalties or suspension/revocation.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. ) ## 17207. The commissioner shall charge and collect the following fees and assessments: (a) For filing an application for an escrow agent’s license, six hundred twenty-five dollars ($625) for the first office or location and four hundred twenty-five dollars ($425) for each additional office or location. (b) For filing an application for a duplicate of an escrow agent’s license lost, stolen, or destroyed, or for replacement, upon a satisfactory showing of the loss, theft, destruction, or surrender of certificate for replacement, two dollars ($2). (c) For investigation services in connection with each application, one hundred dollars ($100), and for investigation services in connection with each additional office application, one hundred dollars ($100). (d) For holding a hearing in connection with the application, as set forth under Section 17209.2, the actual costs experienced in each particular instance. (e) (1) Each escrow agent shall pay to the commissioner for the support of this division for the ensuing year, plus a deficit or less a surplus actually incurred during the prior two fiscal years, an annual license fee not to exceed seven thousand two hundred fifteen dollars ($7,215) for each office or location. (2) On or before May 30 in each year, the commissioner shall notify each escrow agent by mail of the amount of the annual license fee levied against it, and that the payment of the invoice is payable by the escrow agent within 30 days after receipt of notification by the commissioner. (3) If payment is not made within 30 days, the commissioner may assess and collect a penalty, in addition to the annual license fee, of 10 percent of the fee for each month or part of a month that the payment is delayed or withheld. (4) If an escrow agent fails to pay the amount due on or before the June 30 following the day upon which payment is due, the commissioner may by order summarily suspend or revoke the certificate issued to the company. (5) If, after an order is made pursuant to paragraph (4), a request for a hearing is filed in writing and a hearing is not held within 60 days thereafter, the order is deemed rescinded as of its effective date. During any period when its certificate is revoked or suspended, a company shall not conduct business pursuant to this division, except as may be permitted by order of the commissioner. However, the revocation, suspension, or surrender of a certificate shall not affect the powers of the commissioner as provided in this division. (f) Fifty dollars ($50) for investigation services in connection with each application for qualification of any person under Section 17200.8, other than investigation services under subdivision (c) of this section. (g) A fee not to exceed twenty-five dollars ($25) for the filing of a notice or report required by rules adopted pursuant to subdivision (a) or Section 17203.1. (h) (1) If costs and expenses associated with the enforcement of this division, including overhead, are or will be incurred by the commissioner during the year for which the annual license fee is levied, and that will or could result in the commissioner’s incurring of costs and expenses, including overhead, in excess of the costs and expenses, including overhead, budgeted for expenditure for the year in which the annual license fee is levied, then the commissioner may levy a special assessment on each escrow agent for each office or location in an amount estimated to pay for the actual costs and expenses associated with the enforcement of this division, including overhead, in an amount not to exceed one thousand dollars ($1,000) for each office or location. The commissioner shall notify each escrow agent by mail of the amount of the special assessment levied against it, and that payment of the special assessment is payable by the escrow agent within 60 days of receipt of notification by the commissioner. The funds received from the special assessment shall be deposited into the Financial Protection Fund and shall be used only for the purposes for which the special assessment is made. (2) If payment is not made within 60 days, the commissioner may assess and collect a penalty, in addition to the special assessment, of 10 percent of the special assessment for each month or part of a month that the payment is delayed or withheld. If an escrow agent fails to pay the special assessment on or before 60 days following the day upon which payment is due, the commissioner may by order summarily suspend or revoke the certificate issued to the company. If an order is made under this subdivision, the provisions of paragraph (5) of subdivision (e) shall apply. (3) If the amount collected pursuant to this subdivision exceeds the actual costs and expenses, including overhead, incurred in the administration and enforcement of this division and any deficit incurred, the excess shall be credited to each escrow agent on a pro rata basis. (Amended by Stats. 2025, Ch. 20, Sec. 15. (AB 137) Effective June 30, 2025.)
  93. 17208.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. )

    Verify source ↗

    The commissioner must pay all money received into the State Treasury to the credit of the State Corporations Fund.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. ) ## 17208. All money received by the commissioner shall be paid by him or her into the State Treasury to the credit of the State Corporations Fund for the sole purpose of administering and enforcing this division. (Amended by Stats. 1996, Ch. 670, Sec. 2. Effective January 1, 1997.)
  94. 17209.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. )

    Verify source ↗

    An escrow agent license application must be signed, verified, and supported by specified corporate documents and disclosures, and the commissioner and justice agencies handle fingerprint and background-check processing.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. ) ## 17209. An application for a license as an escrow agent shall be signed and verified by an authorized officer of the applicant, and such application shall be accompanied by a certified copy of the articles of incorporation and a copy of the bylaws of the proposed licensee. The application shall set forth: (a) The names and addresses of the incorporators, directors, and officers. (b) An itemized statement of the estimated receipts and expenditures of the proposed first year of operations. (c) An audited financial statement showing compliance with Section 17210. (d) The name and address of the person, or persons, meeting the requirements of Section 17200.8, and a statement supporting such persons’ qualifications. (e) The type of business for which the license is requested. (f) Any other matters the commissioner may require. (g) An application for a license as an escrow agent filed with the commissioner shall also include a completed statement of identity and questionnaire, as prescribed by the commissioner, for all stockholders, directors, officers, trustees, managers, and other persons participating in the escrow business directly or indirectly compensated by the escrow agent (other than usual and customary employees who file pursuant to subdivision (d) of Section 17414.1 and Section 17419) and shall also include fingerprints and related information for those persons pursuant to subdivision (h). The commissioner shall notify the applicant in writing if any of the information received pursuant to this division shows that a person’s employment, participation, or ownership interest would be in violation of Section 17414.1, and the escrow agent shall deny the person the employment or interest. If the application is not satisfactorily amended to remove the deficiency within six months of the first notice of deficiency, the application shall be summarily denied. Persons required to file the employment application pursuant to Section 17419 are not required to file the statement of identity and questionnaire described in this section. (h) (1) The fingerprint images and related information shall be submitted by the commissioner to the Department of Justice, in a manner established by the Department of Justice, for the purposes of obtaining information as to the existence and content of a record of state or federal convictions, state or federal arrests, and information as to the existence of and content of a record of state or federal arrests for which the Department of Justice establishes that the person is free on bail or on his or her own recognizance pending trial or appeal. (2) Upon receipt, the Department of Justice shall forward to the Federal Bureau of Investigation requests for federal summary criminal history information received from the commissioner pursuant to this section. The Department of Justice shall review the information returned from the Federal Bureau of Investigation and compile and disseminate a response to the commissioner pursuant to subdivision (p) of Section 11105 of the Penal Code. (3) The commissioner shall request from the Department of Justice subsequent arrest notification service as provided pursuant to Section 11105.2 of the Penal Code. (4) The Department of Justice shall charge a fee sufficient to cover the costs of processing the requests pursuant to this subdivision. (Amended by Stats. 2008, Ch. 262, Sec. 1. Effective January 1, 2009.)
  95. 17209.1.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. )

    Verify source ↗

    After receiving a complete license application and all required fees, the commissioner must immediately examine and investigate the proposal.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. ) ## 17209.1. Upon the receipt of a proper and complete application for license, and all required fees, the commissioner shall immediately examine and investigate all facts connected with the proposal, including but not limited to its stockholders, directors, officers and managers, proposed location, and estimated receipts and expenditures. (Amended by Stats. 1982, Ch. 663, Sec. 5.)
  96. 17209.2.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. )

    Verify source ↗

    The commissioner may require an applicant to attend an appropriate hearing, and if a hearing is held, the commissioner must mail notice to the applicant at least 10 days before it.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. ) ## 17209.2. The commissioner may or may not require an applicant to submit to an appropriate hearing. If a hearing is held the commissioner shall, on or before 10 days prior to the hearing, mail notice thereof to the applicant. At such hearing any interested person may show cause either in favor of, or opposed to, the application. (Amended by Stats. 1982, Ch. 663, Sec. 6.)
  97. 17209.3.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. )

    Verify source ↗

    The commissioner may, and in some cases must, refuse to issue a license if specified problems are found in the application or applicant.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. ) ## 17209.3. The commissioner may refuse to issue any license being applied for, and shall refuse to issue any license being applied for if upon the commissioner’s examination and investigation, and after appropriate hearing, the commissioner finds any of the following: (a) That the corporation is to be formed for any business other than legitimate escrow agent services, or proposes to use a name that is misleading or in conflict with the name of an existing licensee. (b) That any incorporator, officer, or director of the applicant has, within the last 10 years, been (1) convicted of or pleaded nolo contendere to a crime, or (2) committed any act involving dishonesty, fraud, or deceit, which crime or act is substantially related to the qualifications, functions, or duties of a person engaged in business in accordance with the provisions of this division. (c) That there is no officer or manager possessing a minimum of five years of responsible escrow or joint control experience stationed or to be stationed at the main office of the corporation and that there is no officer, manager or employee possessing a minimum of four years of responsible escrow or joint control experience stationed or to be stationed at each branch. (d) That the proposed licensee’s financial program is unsound. (e) A false statement of a material fact has been made in the application for license. (f) The applicant, any officer, director, general partner, or incorporator of the applicant, or any person owning or controlling, directly or indirectly, 10 percent or more of the outstanding equity securities of the applicant has violated any provision of this division or the rules thereunder or any similar regulatory scheme of the State of California or a foreign jurisdiction. (g) The applicant has failed to comply with the Fidelity Corporation’s membership requirements set forth in subdivision (b) of Section 17312, in subdivision (a) of Section 17320, and in Sections 17331 and 17331.1. (Amended by Stats. 2003, Ch. 473, Sec. 18. Effective January 1, 2004.)
  98. 17209.4.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. )

    Verify source ↗

    The license must state whether the licensee is licensed as an escrow agent or a joint control agent.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. ) ## 17209.4. The license shall state whether the licensee is licensed as an escrow agent or joint control agent. (Added by Stats. 1982, Ch. 663, Sec. 8.)
  99. 1721.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 4. Facilities of Uninsured Foreign (Other State) Banks [1710 - 1721] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    A license may not be transferred or assigned.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 19. Foreign (Other State) Banks [1670 - 1721] ( Chapter 19 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 4. Facilities of Uninsured Foreign (Other State) Banks [1710 - 1721] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1721. No license is transferable or assignable. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  100. 17210.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. )

    Verify source ↗

    Escrow agents must keep minimum tangible net worth and liquid-asset levels, with different amounts depending on when they were licensed and, for branch offices, additional capital requirements.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. ) ## 17210. (a) An escrow agent licensed on or after January 1, 1986, shall maintain at all times a tangible net worth of fifty thousand dollars ($50,000), including liquid assets of at least twenty-five thousand dollars ($25,000) in excess of current liabilities. (b) An escrow agent licensed prior to January 1, 1986, shall maintain at all times a tangible net worth according to the following schedule: (1) Ten thousand dollars ($10,000) from January 1, 1986, through June 30, 1986, including liquid assets of at least ten thousand dollars ($10,000) in excess of current liabilities. (2) Fifteen thousand dollars ($15,000) as of July 1, 1986, including liquid assets of at least fifteen thousand dollars ($15,000) in excess of current liabilities. (3) Twenty thousand dollars ($20,000) as of July 1, 1987, including liquid assets of at least twenty thousand dollars ($20,000) in excess of current liabilities. (4) Twenty-five thousand dollars ($25,000) as of July 1, 1988, including liquid assets of at least twenty-five thousand dollars ($25,000) in excess of current liabilities. (5) Thirty thousand dollars ($30,000) as of July 1, 1989, including liquid assets of at least twenty-five thousand dollars ($25,000) in excess of current liabilities. (6) Thirty-five thousand dollars ($35,000) as of July 1, 1990, including liquid assets of at least twenty-five thousand dollars ($25,000) in excess of current liabilities. (7) Forty thousand dollars ($40,000) as of July 1, 1991, including liquid assets of at least twenty-five thousand dollars ($25,000) in excess of current liabilities. (8) Forty-five thousand dollars ($45,000) as of July 1, 1992, including liquid assets of at least twenty-five thousand dollars ($25,000) in excess of current liabilities. (9) Fifty thousand dollars ($50,000) as of July 1, 1993, and thereafter, including liquid assets of at least twenty-five thousand dollars ($25,000) in excess of current liabilities. (c) The commissioner may determine by rule as to which assets constitute liquid assets and may also determine in an individual case by a specific written ruling whether a particular asset is a liquid asset within the meaning of this section. (d) In the case of a licensed branch office, a tangible net worth in addition to that required by subdivision (a) shall be maintained at an amount equal to 50 percent of the tangible net worth required by subdivision (a), except that licensees operating or applying for more than one branch office shall maintain an additional tangible net worth of at least 25 percent of the amount required by subdivision (a) for each branch office licensed after the first branch office location. (Repealed and added by Stats. 1985, Ch. 1560, Sec. 4. Effective October 2, 1985. Operative January 1, 1986, by Sec. 45 of Ch. 1560.)
  101. 17210.1.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. )

    Verify source ↗

    The licensee must keep the license conspicuously posted in all of the licensee’s places of business.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. ) ## 17210.1. The license shall be kept conspicuously posted in all places of business of the licensee. (Added by Stats. 1953, Ch. 1076.)
  102. 17210.2.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. )

    Verify source ↗

    Escrow agents may not make false, misleading, deceptive, incomplete, or supervision-related statements. Licensed escrow agents must include a specified licensure statement in certain communications, and the commissioner may order a person to stop violating the section.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. ) ## 17210.2. (a) No escrow agent shall disseminate, or cause or permit to be disseminated, in any manner whatsoever, any statement or representation which is false, misleading, or deceptive, or which omits to state material information, or which refers to the supervision of that agent by the State of California or any department or official thereof. (b) A licensed escrow agent, in referring to the corporation’s licensure under this law in any written or printed communication or any communication by means of recorded telephone messages or spoken on radio, television, or similar communications media, shall include the following statement: “This escrow company holds California Department of Financial Protection and Innovation Escrow License No. ____.” (c) The commissioner may order any person to desist from any conduct which the commissioner finds to be a violation of this section. (Amended by Stats. 2022, Ch. 452, Sec. 120. (SB 1498) Effective January 1, 2023.)
  103. 17212.1.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. )

    Verify source ↗

    Licensees must report specified personnel changes to the commissioner and provide the required identity and fingerprint materials, subject to listed exceptions.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. ) ## 17212.1. All licensees shall notify the commissioner of any changes in shareholders, directors, officers, trustees, managers, and other persons participating in the escrow business directly or indirectly compensated by the escrow agent (other than usual and customary employees who file pursuant to subdivision (d) of Section 17414.1 and Section 17419), by filing by certified mail, return receipt requested, for those persons a statement of identity and questionnaire, as prescribed by the commissioner for those persons, and fingerprint images and related information, submitted using the process established by the Department of Justice for requesting state and federal summary criminal history information. Persons who have previously submitted fingerprints or fingerprint images and related information to the commissioner may so notify the commissioner and need not submit additional fingerprint images and related information unless requested to do so by the commissioner. The commissioner shall provide written notice to both the licensee and to the person if any of the information received pursuant to this division shows that the person’s employment, participation, or ownership interest would be in violation of Section 17414.1, and upon that notification the escrow agent shall deny the person the employment or interest. No person shall have access to trust funds or sign checks or otherwise perform any activities related to the processing of escrow transactions after the licensed escrow agent has been notified by the commissioner that the person’s employment, participation, or ownership interest is in violation of Section 17414.1. The requirements set forth in this section are in addition to those required under Section 17213. The commissioner may by regulation require licensees to file at such times as he or she may specify additional information as he or she may reasonably require regarding any changes in the information provided in any application filed pursuant to this division. (Amended by Stats. 2008, Ch. 262, Sec. 2. Effective January 1, 2009.)
  104. 17213.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. )

    Verify source ↗

    An escrow agent must use its incorporated name, cannot transfer or assign its license, and needs commissioner consent for certain license acquisitions. A new licensure application is required before a 10% or larger share transfer, except between qualifying existing 10% shareholders.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. ) ## 17213. (a) An escrow agent shall not transact business pursuant to this division under any other name than that set forth in the articles of incorporation as filed with the commissioner. (b) An escrow agent’s license is not transferable or assignable. Further, no license may be acquired, either in whole or in part, directly or indirectly, through stock purchase, foreclosure pursuant to a pledge or hypothecation, or other devices without the consent of the commissioner. Prior to the transfer of 10 percent or more of the shares of an escrow agent, the escrow agent shall file a new application for licensure as required by Section 17201. However, a new application for licensure shall not be required to be filed by the escrow agent if the transfer of 10 percent or more of the shares of the escrow agent will be made by an existing shareholder to another existing shareholder who also owns 10 percent or more of the shares of the escrow agent before the transfer. (Amended by Stats. 1998, Ch. 174, Sec. 1. Effective January 1, 1999.)
  105. 17213.1.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. )

    Verify source ↗

    Escrow agents generally need the commissioner’s prior approval before moving a licensed business location, and they must give 30 days’ notice unless the commissioner waives it for fire, emergency, or other catastrophe.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. ) ## 17213.1. (a) An escrow agent’s business shall not be removed from the premises or address shown on the license without the prior approval of the commissioner, and notice of any intended change shall be transmitted to the commissioner not less than 30 days prior to the date of the intended change of location; provided, however, that the commissioner may waive the 30-day notice requirement when the move is occasioned by fire, emergency, or other catastrophe. The commissioner’s approval shall be granted or denied within 30 days from the date of the commissioner’s receipt of the licensee’s request containing such information as the commissioner may require. (b) When a licensed business is to be moved a distance of five or more miles, and a change in ownership results from a transfer of 50 percent or more of the shares of the corporation, a licensee shall file an application for authorization to change location on a form furnished by the commissioner and the commissioner shall: (1) treat the matter as an application for a new license by invoking the provisions of Sections 17209, 17209.1, 17209.2, and 17209.3, and (2) require the payment of such fees as are applicable under Section 17207. The provisions of this subdivision shall not apply when the actual or contemplated change of ownership is to the transferor’s ancestors, descendants, or spouse, or any custodian or trustee for the account of the transferor or the transferor’s ancestors, descendants, or spouse. (Amended by Stats. 1982, Ch. 663, Sec. 9.)
  106. 17213.2.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. )

    Verify source ↗

    A licensed escrow agent that opens a branch office or changes business locations without the commissioner’s prior approval may be ordered to forfeit money each day of noncompliance.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. ) ## 17213.2. The commissioner may order a licensed escrow agent which opens a branch office or changes its business location or locations without first obtaining the approval of the commissioner to forfeit to the people of the state a sum of up to one hundred dollars ($100) for every day for the first 10 days and ten dollars ($10) for every day thereafter during which the branch office or changed location is maintained without authority. (Amended by Stats. 1990, Ch. 1186, Sec. 3.)
  107. 17213.5.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. )

    Verify source ↗

    Licensees may open additional offices only if they meet listed filing, fee, bond, financial, and disclosure requirements.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. ) ## 17213.5. Licensees of this division shall be entitled to establish additional business office locations by compliance with all of the following: (a) Filing with the commissioner notice of the intended address, or addresses. (b) Payment of the fees prescribed in Section 17207. (c) Filing with the commissioner any additional bonds for the purposes set forth in Sections 17202 and 17203. In addition to the amount required by Section 17202, the amounts for additional office locations shall be five thousand dollars ($5,000) for each additional location. The aggregate amounts of all bonds given by a licensee under this section shall be for the purpose of complying with the conditions of Sections 17202 and 17203 regardless of the office location at which any act violating those conditions takes place, and upon payment of the aggregate amount, the surety is completely released from further liability under the bond or bonds. An escrow agent licensed prior to January 1, 1996, shall comply with the requirements of this subdivision at the time of the next renewal of its bond. (d) Filing with the commissioner financial statements prepared in accordance with generally accepted accounting principles. If the licensee’s fiscal year end is more than six months before the date of filing the application, the commissioner may require current financial statements which shall not be more than 60 days old. The interim financial statements may be unaudited. (e) Filing with the commissioner the names and addresses of the licensee’s owners and employees to be stationed at the new location, showing that the operation of the additional office, or offices, will be under the complete management and control of the parent licensee. (f) Filing with the commissioner statements offsetting and meeting each of the conditions set forth in Section 17209.3. With respect to all applications for authorization to establish additional locations, the commissioner shall promptly commence his or her investigation and review of the application. The commissioner shall within 30 days from the receipt by the commissioner of a separate and complete application, license the designated premises as a branch of the parent licensee, unless the commissioner finds (1) that the applicant has failed to comply with all of the requirements of this section, (2) that the applicant then fails to meet any of the standards applicable for the issuance of a license pursuant to Section 17209.3, or (3) that a hearing shall be held to determine whether the application should be granted or denied. (Amended by Stats. 1995, Ch. 226, Sec. 1. Effective January 1, 1996.)
  108. 17214.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. )

    Verify source ↗

    This section creates an 11-member Escrow Law Advisory Committee in the Department of Financial Protection and Innovation and sets rules for its membership and operation.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. ) ## 17214. (a) There is established in the Department of Financial Protection and Innovation an Escrow Law Advisory Committee consisting of 11 members. The members shall consist of the commissioner or their designee; the chairman of the board and the immediate past chairman of the board for the Escrow Agents’ Fidelity Corporation; the current chairman of the board and the immediate past chairman of the board for the Escrow Institute of California; a person selected by the commissioner to represent a different type of business ownership under this division; a person selected by the commissioner to represent a different type of business specialization; a person selected by the commissioner to represent small businesses operating pursuant to this division; a person selected by the commissioner to represent medium-sized businesses operating pursuant to this division; an attorney at law experienced in escrow matters selected by the commissioner; and a certified public accountant experienced in the escrow business selected by the commissioner. Except for the members from the Escrow Agents’ Fidelity Corporation and the Escrow Institute of California, members appointed by the commissioner shall serve for a term of two years. The committee shall meet at least quarterly. The commissioner or their designee shall chair the committee. All members shall serve without compensation or reimbursement for expenses. Where the chairman of the board or the immediate past chairman of the board of the Escrow Agents’ Fidelity Corporation is the same person, or is unable to serve on the advisory committee, then the commissioner, after consultation with the board of directors of the Escrow Agents’ Fidelity Corporation, shall choose a member of the board of directors to serve on the committee. Where the president or past president of the Escrow Institute of California is the same person, or is unable to serve on the advisory committee, then the commissioner, after consultation with the board of directors of the Escrow Institute of California, shall choose a member of the board of directors to serve on the committee. (b) The purpose of the committee is to assist the commissioner in the implementation of the commissioner’s duties under this chapter. (Amended by Stats. 2022, Ch. 452, Sec. 121. (SB 1498) Effective January 1, 2023.)
  109. 17215.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. )

    Verify source ↗

    When the commissioner issues a license or order under this division, the commissioner may attach conditions that are necessary and appropriate to carry out this division’s purposes.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. License and Bond [17200 - 17215] ( Heading of Chapter 2 amended by Stats. 1961, Ch. 475. ) ## 17215. Whenever the commissioner issues a license or order under this division, the commissioner may impose conditions that are necessary and appropriate to carry out the provisions and purposes of this division and, with respect to Internet escrow agents, are also consistent with the intent of the Legislature. (Added by Stats. 1999, Ch. 441, Sec. 7. Effective January 1, 2000.)
  110. 173.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 1. Definitions [99 - 217] ( Chapter 1 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    This section defines “foreign” for certain banks and corporations, and defines “foreign banking corporation” as a foreign bank.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 1. Definitions [99 - 217] ( Chapter 1 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 173. (a) “Foreign,” when used with respect to a bank, an office of a bank, or any corporation other than a bank, means foreign (other nation) or foreign (other state). (b) “Foreign banking corporation” means a foreign bank. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  111. 17300.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 1. Definitions [17300 - 17305] ( Article 1 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    This section defines “Fidelity Corporation” as the Escrow Agents’ Fidelity Corporation.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 1. Definitions [17300 - 17305] ( Article 1 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17300. “Fidelity Corporation” means the Escrow Agents’ Fidelity Corporation. (Amended by Stats. 1985, Ch. 1560, Sec. 6. Effective October 2, 1985.)
  112. 17301.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 1. Definitions [17300 - 17305] ( Article 1 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    “Member” means a person licensed under this division who must belong to Fidelity Corporation under Section 17312.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 1. Definitions [17300 - 17305] ( Article 1 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17301. “Member” means any person licensed under this division who is required by Section 17312 to be a member of Fidelity Corporation. (Amended by Stats. 1985, Ch. 1560, Sec. 7. Effective October 2, 1985.)
  113. 17302.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 1. Definitions [17300 - 17305] ( Article 1 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    This section defines “trust obligation” for escrow-related deposits in California.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 1. Definitions [17300 - 17305] ( Article 1 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17302. “Trust obligation” means: (a) All money and property deposited with a member within the State of California in an escrow or joint control transaction. (b) All money and property deposited with a member to be held in trust within the State of California pursuant to a federal or state statute or requirements of a governmental agency. (Amended by Stats. 2001, Ch. 662, Sec. 1. Effective January 1, 2002.)
  114. 17303.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 1. Definitions [17300 - 17305] ( Article 1 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    “Commissioner” means the Commissioner of Financial Protection and Innovation.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 1. Definitions [17300 - 17305] ( Article 1 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17303. “Commissioner” means the Commissioner of Financial Protection and Innovation. (Amended by Stats. 2022, Ch. 452, Sec. 122. (SB 1498) Effective January 1, 2023.)
  115. 17304.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 1. Definitions [17300 - 17305] ( Article 1 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    This section defines “loss” for the chapter as a member’s loss of trust obligations in California caused by fraudulent or dishonest abstraction, misappropriation, or embezzlement by certain insiders or employees.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 1. Definitions [17300 - 17305] ( Article 1 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17304. “Loss,” within the meaning of this chapter, means the loss of trust obligations held by a member within the State of California as a result of the fraudulent or dishonest abstraction, misappropriation, or embezzlement of trust obligations by an officer, director, trustee, stockholder, manager, or employee of a member. (Amended by Stats. 2001, Ch. 662, Sec. 2. Effective January 1, 2002.)
  116. 17305.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 1. Definitions [17300 - 17305] ( Article 1 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    This section defines “monthly average escrow liability” for use in this chapter.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 1. Definitions [17300 - 17305] ( Article 1 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17305. “Monthly average escrow liability,” as used in this chapter, means the average escrow liability for the 12-month period as reported in the most recent report made by the member to the commissioner pursuant to Section 17348. (Amended by Stats. 1989, Ch. 590, Sec. 1.)
  117. 17310.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 2. Purpose: Scope of Guarantee [17310 - 17315] ( Article 2 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    Fidelity Corporation must indemnify members in California against loss, within the chapter’s limits, and it must give copies of the fidelity bond or insurance policy to members and the commissioner, and promptly on request to a member or successor in interest. It is not liable for consequential or punitive damages.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 2. Purpose: Scope of Guarantee [17310 - 17315] ( Article 2 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17310. (a) It shall be the purpose of Fidelity Corporation to indemnify a member within the State of California against loss, subject to the limitations set forth in this chapter. (b) Fidelity Corporation shall not be liable for any consequential damages sustained by a member, or by any other person, nor for any punitive damages whatsoever. (c) The indemnification shall be provided by any of the following: (1) A fund established by Fidelity Corporation pursuant to Section 17320. (2) A fidelity bond or insurance policy to be approved by the commissioner. (3) A combination of paragraphs (1) and (2) subject, however, to the maximum coverage specified in subdivision (b) of Section 17314. (d) Fidelity Corporation shall provide a copy to all of its members and the commissioner of the fidelity bond or insurance policy as it is acquired or renewed, and Fidelity Corporation shall promptly provide a copy to any member or successor in interest, upon request. (Amended by Stats. 2006, Ch. 376, Sec. 1. Effective January 1, 2007.)
  118. 17311.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 2. Purpose: Scope of Guarantee [17310 - 17315] ( Article 2 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    Licensed persons under this division must maintain a corporation called the Escrow Agents’ Fidelity Corporation under the specified nonprofit corporation law, and the State and related officials are not liable for its conduct.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 2. Purpose: Scope of Guarantee [17310 - 17315] ( Article 2 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17311. (a) Persons licensed pursuant to this division shall maintain a corporation under the Nonprofit Mutual Benefit Corporation Law (Part 3 (commencing with Section 7110) of Division 2 of Title 1 of the Corporations Code) operating under the name Escrow Agents’ Fidelity Corporation. (b) The State of California, the Department of Financial Protection and Innovation, or any officer, agent, or employee of either shall not be liable in any way for the conduct of Fidelity Corporation, its directors, officers, agents, employees, or members. (Amended by Stats. 2022, Ch. 452, Sec. 123. (SB 1498) Effective January 1, 2023.)
  119. 17312.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 2. Purpose: Scope of Guarantee [17310 - 17315] ( Article 2 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    Certain California escrow licensees must join Fidelity Corporation, and Fidelity Corporation must keep some application information confidential and issue a compliance letter to the commissioner.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 2. Purpose: Scope of Guarantee [17310 - 17315] ( Article 2 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17312. (a) Each person licensed pursuant to this division who is engaged in the business of receiving escrows specified in subdivision (c) and whose escrow business location is located within the State of California shall participate as a member in Fidelity Corporation in accordance with this chapter and rules established by the Board of Directors of Fidelity Corporation. Fidelity Corporation shall not deny membership to any escrow agent holding a valid unrevoked license under the Escrow Law who is required to be a member under this subdivision. (b) Upon filing a new application for licensure as required by Section 17201, persons required to be a member of Fidelity Corporation shall file a copy thereof concurrently with Fidelity Corporation. If an application for licensure submitted to Fidelity Corporation contains personal or confidential information, Fidelity Corporation and its board shall maintain this information in confidence to protect the privacy of the information. The copy of the application shall include the three-thousand-dollar ($3,000) fee specified in subdivision (a) of Section 17320 and all required Fidelity Corporation Certificates set forth in Sections 17331 and 17331.1. Fidelity Corporation shall promptly furnish to the commissioner a compliance letter confirming that the applicant has satisfied the requirements to be a member of Fidelity Corporation. (c) The required membership in Fidelity Corporation shall be limited to those licensees whose escrow business location is located within the State of California and who engage, in whole or in part, in the business of receiving escrows for deposit or delivery in the following types of transactions: (1) Real property escrows, including, but not limited to, the sale, encumbrance, lease, transfer of title, loans or other obligations to be secured by a lien upon real property, and exchanges, excluding money or property held or deposited pursuant to paragraph (3) of subdivision (a) of Section 51003. (2) Bulk sale escrows, including, but not limited to, the sale or transfer of title to a business entity and the transfer of liquor licenses or other types of business licenses or permits. (3) Fund or joint control escrows, including, but not limited to, transactions specified in Section 17005.1, and contracts specified in Section 10263 of the Public Contract Code. (4) The sale, transfer of title, or refinance escrows for manufactured homes or mobilehomes. (5) Reservation deposits required under Article 2 (commencing with Section 11010) of Chapter 1 of Part 2 of Division 4 of the Business and Professions Code or by regulation of the Bureau of Real Estate to be held in an escrow account. (6) Escrows for sale, transfer, modification, assignment, or hypothecation of promissory notes secured by deeds of trust. (d) Coverage required to be provided by Fidelity Corporation under this chapter shall be provided to members only for loss of trust obligations with respect to those types of transactions specified in subdivision (c). If a loss covered by Fidelity Corporation is also covered by a member’s general liability, dishonesty, or indemnity policy, or other private insurance policy, then the member’s private policy shall first be applied as the primary indemnity to cover the loss. However, the failure of the member’s private primary policy to indemnify the member’s loss within the time specified for Fidelity Corporation indemnity in subdivision (a) of Section 17314 shall not limit the indemnity obligations of Fidelity Corporation as defined in this chapter. Indemnity coverage for those types of transactions not specified in subdivision (c) shall be provided by escrow agents in accordance with Section 17203.1. (Amended by Stats. 2013, Ch. 352, Sec. 88. (AB 1317) Effective September 26, 2013. Operative July 1, 2013, by Sec. 543 of Ch. 352.)
  120. 17313.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 2. Purpose: Scope of Guarantee [17310 - 17315] ( Article 2 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    The commissioner must review and approve Fidelity Corporation’s articles of incorporation and bylaws before they are filed with the Secretary of State.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 2. Purpose: Scope of Guarantee [17310 - 17315] ( Article 2 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17313. The commissioner shall review and approve the articles of incorporation and bylaws of Fidelity Corporation before they are filed with the Secretary of State. (Amended by Stats. 1985, Ch. 1560, Sec. 11. Effective October 2, 1985.)
  121. 17313.1.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 2. Purpose: Scope of Guarantee [17310 - 17315] ( Article 2 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    Fidelity Corporation’s fiscal year must begin on July 1 each year.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 2. Purpose: Scope of Guarantee [17310 - 17315] ( Article 2 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17313.1. The fiscal year of Fidelity Corporation shall commence on July 1 of each year. (Added by Stats. 1988, Ch. 1458, Sec. 5. Effective September 28, 1988.)
  122. 17314.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 2. Purpose: Scope of Guarantee [17310 - 17315] ( Article 2 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    Fidelity Corporation must cover members’ trust-obligation losses within the chapter’s limits, and it must pay or deny claims within 90 days after receiving proof of loss.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 2. Purpose: Scope of Guarantee [17310 - 17315] ( Article 2 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17314. (a) Fidelity Corporation shall pay a member for loss of trust obligations subject to the limitations set forth in this chapter. Fidelity Corporation shall pay or deny the claim within 90 days of receipt of the proof of loss filed by a member, or a member’s successor in interest. Notwithstanding any other provision of this article, the protection to members provided by Fidelity Corporation and by the fidelity bond or insurance policy, if any, shall not extend to any transaction involving any member at any branch or business location outside the State of California, but shall extend only to escrow trust obligations and trust funds located within the State of California. (b) Coverage shall be provided to members in accordance with the following schedule: MONTHLY AVERAGE ESCROW LIABILITY PER LOCATION COVERAGE $0 - $ 1,000,000 $1,000,000 over $1,000,000 - $ 3,000,000 $2,000,000 over $3,000,000 - $ 5,000,000 $3,000,000 over $5,000,000 - $ 7,500,000 $4,000,000 over $7,500,000 - $10,000,000 $5,000,000 Pursuant to the schedule, the minimum coverage by Fidelity Corporation for each licensed location shall be one million dollars ($1,000,000) and the maximum coverage for each licensed location shall be five million dollars ($5,000,000). (c) A member shall maintain minimum coverage in accordance with the schedule in subdivision (b) and shall monitor its escrow liability monthly. An increase in escrow liability above the monthly average escrow liability coverage as provided for in subdivision (b) shall be reported immediately to Fidelity Corporation. Upon receipt of this report, Fidelity Corporation shall immediately provide for the increase in coverage, and shall immediately bill and collect pursuant to Section 17321, an amount necessary to provide for the increased coverage. (d) Any member with a licensed location or locations with a monthly average escrow liability greater than ten million dollars ($10,000,000) shall obtain a bond from a corporate surety which is an admitted insurer in the State of California insuring the balance of trust funds not covered by Fidelity Corporation, in a ratio of one dollar of coverage for every three dollars of trust obligations not covered by Fidelity Corporation. The Fidelity Corporation shall have the authority to obtain the excess coverage bond. The cost of the bond shall be shared pro rata by those members included in the coverage. (e) If a member establishes, to the satisfaction of the commissioner, that a bond is not available or is impracticable under subdivision (d), then, at the member’s election, either: (1) The member shall place average trust obligations in excess of ten million dollars ($10,000,000) in a restricted escrow trust account. Each transfer or release of the funds to be made by specific resolution of the member’s board of directors and the signature of a neutral third party; or (2) The licensed location of the member with average trust balances in excess of ten million dollars ($10,000,000) shall be subject to examinations to be conducted at a frequency as deemed appropriate and necessary by the commissioner or Fidelity Corporation, but not less frequently than once a year. (f) Any member subject to subdivision (e) shall within 10 business days after the effective date of this section notify Fidelity Corporation of its election. A member who subsequently becomes subject to subdivision (e) shall within a like period of time notify Fidelity Corporation of its election. Fidelity Corporation shall also be notified of any change of election in a like period of time. Fidelity Corporation shall notify the commissioner within 10 business days of receipt of any notice under this subdivision of the elections made. All notices under this subdivision shall be in writing. (Amended by Stats. 2004, Ch. 180, Sec. 1. Effective January 1, 2005.)
  123. 17314.1.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 2. Purpose: Scope of Guarantee [17310 - 17315] ( Article 2 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    Fidelity Corporation does not have to pay a member’s claim unless the claim would otherwise be valid under the bond and is filed within the time required by Section 17205.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 2. Purpose: Scope of Guarantee [17310 - 17315] ( Article 2 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17314.1. (a) Notwithstanding any other provision of this article, Fidelity Corporation shall not be obligated to pay any claim made by a member unless (1) the claim would, except for the dollar amount thereof, be a valid claim under the bond as prescribed by Section 17203.1 and (2) the claim is made within the time prescribed by Section 17205. The protection to members provided by Fidelity Corporation and by the fidelity bond or insurance policy, if any, shall therefore be deemed to be coextensive except as to the dollar amounts as set forth in Section 17314. All defenses available to the insurer under the fidelity bond or insurance policy, if any, on any claim shall also be a defense to Fidelity Corporation, as either an indemnitor or surety, on any claim brought against the corporation. (b) No person other than a member, or the member’s successor in interest, who shall be the commissioner, a conservator, receiver, or trustee as designated by a court of competent jurisdiction, is entitled to assert a claim against Fidelity Corporation for losses covered under this article. (Amended by Stats. 2006, Ch. 376, Sec. 2. Effective January 1, 2007.)
  124. 17314.2.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 2. Purpose: Scope of Guarantee [17310 - 17315] ( Article 2 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    Claims filed before this chapter took effect are governed by the rules that were in effect when the loss happened.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 2. Purpose: Scope of Guarantee [17310 - 17315] ( Article 2 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17314.2. Claims filed prior to the effective date of this chapter shall be governed by the provisions in effect when the loss occurred. (Added by Stats. 1988, Ch. 1458, Sec. 9. Effective September 28, 1988.)
  125. 17314.3.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 2. Purpose: Scope of Guarantee [17310 - 17315] ( Article 2 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    A deductible applies to each member loss, and Fidelity Corporation must pay the loss, after which the member must repay the deductible.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 2. Purpose: Scope of Guarantee [17310 - 17315] ( Article 2 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17314.3. (a) A deductible shall apply to each loss suffered by a member in the amount of five thousand dollars ($5,000), plus 5 percent of the amount by which the loss exceeds five thousand dollars ($5,000). If a member with more than one licensed location suffers a covered loss at more than one location, the deductible shall apply to each location separately in proportion to the amount of the loss suffered at each such licensed location. (b) Fidelity Corporation shall pay the full amount of any member’s loss to the member or the member’s successor in interest. The member shall be obligated to pay to Fidelity Corporation the amount of the member’s deductible after payment in full of the loss by Fidelity Corporation. (c) In the event a license is surrendered, suspended, or revoked prior to payment in full by the member of all or any portion of the deductible, the member shall nevertheless be liable to Fidelity Corporation for the amount of the deductible. If the license of the member is surrendered, suspended, or revoked prior to payment in full of the deductible, Fidelity Corporation shall have priority over all other claimants, except the State of California and any conservator or receiver of the member’s estate, against the assets of the licensee, including the bond required under Section 17202. (d) Nothing in this section shall be construed to give any person or entity not (1) a member of Fidelity Corporation, or (2) a successor in interest of a member, or (3) the commissioner any right of action or any right to make a claim directly against Fidelity Corporation, its officers, directors, agents, or employees. Fidelity Corporation shall be entitled to recover its reasonable costs and attorney’s fees as an item of costs, as provided for in paragraph (10) of subdivision (a) and paragraph (5) of subdivision (c) of Section 1033.5 of the Code of Civil Procedure, in defending any claim made directly against Fidelity Corporation, not authorized in this division. (e) If a member fails to pay the deductible within the time set forth in the bylaws of Fidelity Corporation, Fidelity Corporation may bring an action at law or in equity against the member to recover the amount of the deductible. Fidelity Corporation shall recover its reasonable costs and attorney’s fees as an item of costs, as provided for in paragraph (10) of subdivision (a) and paragraph (5) of subdivision (c) of Section 1033.5 of the Code of Civil Procedure, provided, that the payment of the costs and attorney’s fees will not cause the member to be in violation of Section 17202, 17202.1, or 17210. (Amended by Stats. 1990, Ch. 1431, Sec. 1.)
  126. 17315.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 2. Purpose: Scope of Guarantee [17310 - 17315] ( Article 2 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    The commissioner may make reasonable and necessary rules to carry out this chapter.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 2. Purpose: Scope of Guarantee [17310 - 17315] ( Article 2 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17315. The commissioner may establish rules which are reasonable and necessary to carry out the provisions of this chapter. (Added by Stats. 1982, Ch. 1106, Sec. 1.)
  127. 17320.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 3. Membership Fee and Assessments [17320 - 17324] ( Article 3 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    Fidelity Corporation must maintain three funds and members/applicants must pay required membership fees and assessments.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 3. Membership Fee and Assessments [17320 - 17324] ( Article 3 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17320. Fidelity Corporation shall establish and maintain the following funds for payment of claims and for payment of costs of administration: the membership fund, the operations fund, and the fidelity fund. (a) An applicant or a licensee shall, at the time an application is filed for a license, pay to Fidelity Corporation a membership fee of three thousand dollars ($3,000) for each location for which a license is applied. If the application is denied, withdrawn, or abandoned, Fidelity Corporation may retain two hundred dollars ($200) from the membership fee to cover costs of administration. (1) The membership fund shall be reserved for payment of claims which exceed the fidelity fund balance and for payment of extraordinary operational costs. (2) Any member who, on the effective date of this section, has an account balance which exceeds the three thousand dollars ($3,000) membership fee times the number of its licensed locations shall be credited in a special reserve account for the excess amount. This balance shall be credited against future assessments made pursuant to subdivision (b) of Section 17321 in an amount not exceeding four hundred dollars ($400) per licensed location per year. Any member whose account balance is less than three thousand dollars ($3,000) times the number of its licensed locations shall, on or before December 1, 1988, pay to Fidelity Corporation an amount sufficient to allow the member’s account to be maintained at three thousand dollars ($3,000) times the number of licensed locations. Fidelity Corporation shall provide each member with an accounting of the amounts being reserved for the members’ membership account and amounts being held as a special reserve. (3) The membership fee, less any unpaid assessments and related costs, shall be refunded to the member in accordance with Fidelity Corporation’s bylaws not less than 30 months and no more than 36 months after the effective date of surrender of a license. (4) Any member who does not engage in any escrow transactions pursuant to subdivision (c) of Section 17312 may terminate its membership in Fidelity Corporation by written notice to Fidelity Corporation and the Department of Financial Protection and Innovation, as provided in the Fidelity Corporation’s bylaws and rules and regulations. The membership fee, less any unpaid assessments and related costs, shall be refunded to the member in accordance with Fidelity Corporation’s bylaws not less than 30 months and no more than 36 months after the effective date of the member’s written request to terminate its membership in Fidelity Corporation. Before a licensee resumes those escrow transactions, it shall first be required to become a member of Fidelity Corporation, as provided in this subdivision. (b) Fidelity Corporation shall prepare, prior to its fiscal year end, an estimated annual operational budget projecting the costs of operations and administration for the succeeding fiscal year, excluding the amount paid for claims and premiums paid for excess coverage bonding. The amount of the assessment shall be 150 percent of the budgetary projection. In succeeding years, the assessment shall be adjusted by adding the prior year’s deficit or deducting unused surplus from the prior year. (c) Fidelity Corporation shall establish a fidelity fund for the payment of claims and for the payment of the premium for the fidelity bond or insurance policy, if any. All claims shall be paid from the fidelity fund, provided that, to the extent that the fidelity fund balance is not sufficient to pay claims, the claim shall be paid from the membership fund by charging each member’s membership account a pro rata share of the excess. (d) All interest earned on the membership fund and the operations fund shall be credited to the fidelity fund. (Amended by Stats. 2022, Ch. 452, Sec. 124. (SB 1498) Effective January 1, 2023.)
  128. 17321.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 3. Membership Fee and Assessments [17320 - 17324] ( Article 3 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    The Fidelity Corporation must bill and collect annual premiums from members, and members must pay the assessments on the stated schedule and formula.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 3. Membership Fee and Assessments [17320 - 17324] ( Article 3 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17321. Fidelity Corporation shall bill and collect from each member an annual premium that in the aggregate shall consist of assessments for the operations fund and the fidelity fund. (a) The annual assessment for the operations fund shall be assessed no later than October 15 of each year for the current fiscal year in accordance with subdivision (b) of Section 17320. The payment of any invoice for assessments under this subdivision is payable by the member escrow agent in three equal and consecutive monthly installments with the first installment payable at or within 30 days after receipt of the Fidelity Corporation invoice. The assessment shall include: (1) All costs and expenses of administration as budgeted by the board of directors for the current fiscal year. (2) Any expenses actually incurred in the preceding fiscal year which exceeded the budgeted costs of expenses and administration except for expenses recovered pursuant to subdivision (a) of Section 17321.1. Each member’s assessment shall be determined pro rata based upon the ratio of each member’s licensed locations to the total licensed locations of all members as of the preceding June 30. Members licensed on or after July 1 of each year shall be assessed only for costs and expenses pursuant to paragraph (1) of this subdivision. This assessment shall be prorated on a monthly basis. (b) The annual assessment for the fidelity fund shall be assessed no later than May 1. The assessment shall include any amount necessary to replenish the membership fund pursuant to Section 17324, and shall be based upon the balances of the membership fund and the fidelity fund as of December 31 of the previous year and the escrow liability schedule of each licensed location as provided in Section 17348, and shall be calculated as follows: (1) If the membership fund and fidelity fund in the aggregate equal an amount less than five million dollars ($5,000,000), or if the balance in the fidelity fund is less than two million five hundred thousand dollars ($2,500,000), then the assessment shall be the greater of: (A) the amount necessary to bring the membership fund and fidelity fund in the aggregate up to five million dollars ($5,000,000), but not to exceed one million dollars ($1,000,000) per assessment, or (B) the amount necessary to maintain a minimum fidelity fund balance of two million five hundred thousand dollars ($2,500,000), including the amount of the assessment, or (C) four hundred thousand dollars ($400,000). (2) If the membership fund and fidelity fund in the aggregate equal an amount that is at least five million dollars ($5,000,000), and the balance in the fidelity fund is at least two million five hundred thousand dollars ($2,500,000), then the assessment shall be four hundred thousand dollars ($400,000). Each member’s fidelity fund assessment for paragraphs (1) and (2) shall be the amount derived by multiplying the amount to be assessed by the ratio that each member’s risk factors bear to the total of all members’ risk factors. A member’s risk factors shall be computed in accordance with the following formula, except that the total factors of a member shall be reduced by one for each licensed branch location: Coverage per Licensed Location Factors $1,000,000 3 $2,000,000 5 $3,000,000 7 $4,000,000 8 $5,000,000 9 (c) Notwithstanding subdivision (b), the assessment for the fidelity fund for the fiscal year beginning July 1, 1989, shall be made immediately upon 90-day notice of cancellation of the fidelity bond or insurance policy permitted by paragraph (2) of subdivision (c) of Section 17310, but in no event later than 60 days prior to the date of cancellation. (d) Every licensed member as of March 31 shall pay the fidelity fund assessment, without any pro rata adjustment, notwithstanding that the member may have surrendered a license or have a license revoked prior to the date that the assessment is mailed. (Amended by Stats. 2004, Ch. 180, Sec. 3. Effective January 1, 2005.)
  129. 17321.1.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 3. Membership Fee and Assessments [17320 - 17324] ( Article 3 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    The Fidelity Corporation must levy a special assessment against its members when specified financial trigger conditions occur.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 3. Membership Fee and Assessments [17320 - 17324] ( Article 3 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17321.1. Fidelity Corporation shall levy a special assessment against its members whenever: (a) Deemed necessary by the board of directors in the event of any extraordinary expenses which would seriously deplete the resources of the operations fund; or (b) A proof of loss has been submitted by a member which, if paid during that fiscal year, would reduce the membership fund by 10 percent or more. (Added by Stats. 1988, Ch. 1458, Sec. 15. Effective September 28, 1988.)
  130. 17321.2.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 3. Membership Fee and Assessments [17320 - 17324] ( Article 3 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    Fidelity Corporation may collect late fees, as set out in its bylaws, when assessments under Sections 17320, 17321, or 17321.1 are paid late.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 3. Membership Fee and Assessments [17320 - 17324] ( Article 3 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17321.2. Fidelity Corporation shall be entitled to collect late fees as specified in Fidelity Corporation’s bylaws for any late payment of assessments under Section 17320, 17321, or 17321.1. (Added by Stats. 1988, Ch. 1458, Sec. 16. Effective September 28, 1988.)
  131. 17322.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 3. Membership Fee and Assessments [17320 - 17324] ( Article 3 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    Fidelity Corporation must report each levy of assessment to the commissioner within 10 business days after the levy.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 3. Membership Fee and Assessments [17320 - 17324] ( Article 3 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17322. Fidelity Corporation shall report to the commissioner each levy of assessment within 10 business days after the levy. (Repealed and added by Stats. 1988, Ch. 1458, Sec. 18. Effective September 28, 1988.)
  132. 17323.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 3. Membership Fee and Assessments [17320 - 17324] ( Article 3 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    If a member does not pay an assessment when due, Fidelity Corporation must demand payment within 30 days. The commissioner may then suspend the company’s license, and the company may not do business during the suspension unless the commissioner allows it by order.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 3. Membership Fee and Assessments [17320 - 17324] ( Article 3 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17323. (a) In the event any member fails to pay an assessment when due, Fidelity Corporation shall by written demand addressed to the member request the payment of the assessment within 30 days of the demand letter. If the member fails to pay an assessment, the commissioner may issue an order pursuant to subdivision (b). (b) If a member fails to pay the assessment, or any applicable late fee, the commissioner may by order summarily suspend the license issued to the company. If after the order is made, a request for a hearing is filed in writing and a hearing is not held within 60 days thereafter, the order is deemed rescinded as of its effective date. During any period when its license is suspended, a company shall not conduct business pursuant to this division, except as may be permitted by order of the commissioner. However, the suspension of a license shall not affect the powers of the commissioner as provided in this division. (c) Fidelity Corporation may bring an action at law or in equity against the member to recover any assessment or fees. (d) Fidelity Corporation may be awarded costs and reasonable attorney’s fees, if it prevails in any action against a member, or against a third party, except the commissioner, to enforce a claim against the bond or other security posted by the member pursuant to Section 17202, or in any action against a member pursuant to subdivision (c). Those costs and attorney’s fees may be awarded as an item of costs, as provided for in paragraph (10) of subdivision (a) and paragraph (5) of subdivision (c) of Section 1033.5 of the Code of Civil Procedure, provided that the payment of the costs and attorney’s fees will not cause the member to be in violation of Section 17202, 17202.1, or 17210. (Amended by Stats. 1990, Ch. 1431, Sec. 2.)
  133. 17324.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 3. Membership Fee and Assessments [17320 - 17324] ( Article 3 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    If the membership fund is reduced by certain expenses or claims, it must be replenished, and the next assessment must include enough money to cover that replenishment.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 3. Membership Fee and Assessments [17320 - 17324] ( Article 3 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17324. Any reduction in the membership fund caused by payment of an extraordinary expense pursuant to subdivision (a) of Section 17320 or payment of claims pursuant to subdivision (c) of Section 17320 shall be replenished by the operations fund or the fidelity fund, as appropriate. The next assessment for the operations fund or the fidelity fund, as appropriate, shall include an amount necessary for that replenishment. (Added by Stats. 1988, Ch. 1458, Sec. 20. Effective September 28, 1988.)
  134. 17330.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    A member or successor in interest who suffers a loss may file a claim with Fidelity Corporation for the amount of the loss.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17330. Any member or successor in interest who suffers a loss may file a claim with Fidelity Corporation for the amount of the loss. (Amended by Stats. 1988, Ch. 1458, Sec. 21. Effective September 28, 1988.)
  135. 17331.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    Applicants and certain escrow-agent personnel must complete Fidelity Corporation certificate steps, and the Department of Justice must process related criminal-history requests.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17331. (a) An applicant applying for licensure as an escrow agent under this division is required to apply for a Fidelity Corporation Certificate, prepared and issued by Fidelity Corporation, for each proposed shareholder, officer, director, trustee, manager, or employee who is to be directly or indirectly compensated by the escrow agent, prior to licensure of the escrow agent by the commissioner. (b) A shareholder, officer, director, trustee, manager, or employee of an escrow agent, directly or indirectly compensated by an escrow agent within this state, is required to complete and execute a Fidelity Corporation Certificate application, prepared and issued by Fidelity Corporation, as a condition of their employment or entitlement to compensation, before the person may continue the regular discharge of their duties, or have access to moneys or negotiable securities belonging to or in the possession of the escrow agent, or draw checks upon the escrow agent or the trust funds of the escrow agent. (c) Fidelity Corporation Certificates may also be known as Escrow Agent’s Fidelity Corporation Certificates or EAFC Certificates. The certificate at all times remains the property of Fidelity Corporation, and is not transferable by either a member or employee. The certificate is not a warranty or guarantee by Fidelity Corporation of the integrity, veracity, or competence of the person. (d) An application for a Fidelity Corporation Certificate shall be in writing and in the form prescribed by Fidelity Corporation. The application may include (1) a fee not to exceed fifty dollars ($50), (2) two passport-size photographs, and (3) a set of fingerprint images and related information using the process established by the Department of Justice for requesting state summary criminal history information, plus the fee charged by the Department of Justice for processing noncriminal applicant fingerprint images and related information, in a manner established by the Department of Justice pursuant to subdivision (l). The Department of Justice shall honor the Fidelity Corporation report request form and issue a report to Fidelity Corporation, notwithstanding any other provision of law or regulation to the contrary. Fidelity Corporation is also entitled to submit a set of fingerprint images and related information in the Department of Justice specified noncriminal applicant fingerprint format for the purpose of requesting and obtaining a report from the Department of Justice, for the officers and employees of Fidelity Corporation. A member shall cause the filing of applications for all existing employees as required by this section within 30 days of written notice by Fidelity Corporation to the member. (e) The application form shall include a provision for binding arbitration to allow for arbitration of any appeal or dispute as to a decision by Fidelity Corporation concerning the certificate, as follows: A DISPUTE AS TO WHETHER THE DENIAL OF THIS CERTIFICATE APPLICATION OR ANY SUBSEQUENT SUSPENSION OR REVOCATION OF THE CERTIFICATE IS UNNECESSARY OR UNAUTHORIZED OR WAS IMPROPERLY, NEGLIGENTLY, OR UNLAWFULLY RENDERED, MAY BE DETERMINED BY SUBMISSION TO ARBITRATION AS PROVIDED BY CALIFORNIA LAW, AND NOT BY A LAWSUIT OR RESORT TO COURT PROCESS EXCEPT AS CALIFORNIA LAW PROVIDES FOR JUDICIAL REVIEW OF ARBITRATION PROCEEDINGS OR EXCEPT AS PROVIDED BY SECTION 17331.3 OF THE FINANCIAL CODE. THE APPLICANT MAY, SUBJECT TO AGREEMENT, SUBMIT ANY ISSUE ARISING FROM A DECISION BY FIDELITY CORPORATION TO DENY THIS CERTIFICATE APPLICATION OR TO SUSPEND OR REVOKE THE CERTIFICATE TO BE DECIDED BY BINDING NEUTRAL ARBITRATION. UPON AN AGREEMENT TO SUBMIT TO BINDING NEUTRAL ARBITRATION, THE APPLICANT HAS NO RIGHT TO HAVE ANY DISPUTE CONCERNING THIS CERTIFICATE APPLICATION LITIGATED IN A COURT OR JURY TRIAL NOR ANY JUDICIAL RIGHTS TO DISCOVERY AND APPEAL, EXCEPT AS SPECIFICALLY PROVIDED IN THE ESCROW LAW. ARBITRATION MAY BE COMPELLED AS PROVIDED BY LAW. (f) There is no liability on the part of and no cause of action of any nature may arise against Fidelity Corporation or its members, directors, officers, employees, or agents, the State of California, the Department of Financial Protection and Innovation, or any officer, agent, or employee of the state or the Department of Financial Protection and Innovation for statements made by Fidelity Corporation in reports or recommendations made pursuant to this division, or for reports or recommendations made pursuant to this division to Fidelity Corporation by its members, directors, officers, employees, or agents, the State of California, the Department of Financial Protection and Innovation, or any officer, agent, or employee of the state or the Department of Financial Protection and Innovation, unless the information provided is false and the party making the statement or providing the false information does so with knowledge and malice. Reports or recommendations made pursuant to this section, or Section 17331.1, 17331.2, or 17331.3, are not public documents. (g) There is no liability on the part of and no cause of action of any nature may arise against Fidelity Corporation or its members, directors, officers, employees, or agents, the State of California, the Department of Financial Protection and Innovation, or an officer, agent, or employee of the state or the Department of Financial Protection and Innovation for the release of any information furnished to Fidelity Corporation pursuant to this section unless the information released is false and the party, including Fidelity Corporation, its members, directors, officers, employees, or agents, the state, the Department of Financial Protection and Innovation, or any officer, agent, or employee of the state or the Department of Financial Protection and Innovation, who releases the false information does so with knowledge and malice. (h) There is no liability on the part of and no cause of action of any nature may arise against Fidelity Corporation or its directors, officers, employees, or agents, for any decision to deny an application for a certificate or to suspend or revoke the certificate of any person or for the timing of any decision or the timing of any notice to persons or members thereof, or for any failure to deny an application under subdivision (a) of Section 17331.2. This subdivision does not apply to acts performed in bad faith or with malice. (i) Fidelity Corporation, any member of Fidelity Corporation, an agent of Fidelity Corporation or of its members, or any person who uses any information obtained under this section for any purpose not authorized by this chapter is guilty of a misdemeanor. (j) Section 17331, 17331.1, or 17331.2 does not constitute a restriction or limitation upon the obligation of Fidelity Corporation to indemnify members against loss, as provided in Sections 17310 and 17314. The failure to obtain a certificate, the denial of an application for a certificate, or the suspension, cancellation, or revocation of a certificate does not limit the obligation of Fidelity Corporation to indemnify a member against loss. (k) Notwithstanding Section 11105 of the Penal Code, Fidelity Corporation is entitled to receive state summary criminal history information and subsequent arrest notification from the Department of Justice as a result of fingerprint images and related information submitted to the Department of Justice by the Department of Financial Protection and Innovation, pursuant to subdivision (g) of Section 17209, Section 17212.1, and subdivision (d) of Section 17414.1, by or on behalf of escrow agents, shareholders, officers, directors, trustees, managers, or employees of an escrow agent, directly or indirectly compensated by an escrow agent. The Department of Justice and Fidelity Corporation shall enter into an agreement to implement this subdivision. The Department of Financial Protection and Innovation shall forward to Fidelity Corporation, weekly, a list of names of individual fingerprints submitted to the Department of Justice. (l) (1) The fingerprint images and related information required pursuant to subdivision (d) shall be submitted by the Department of Financial Protection and Innovation to the Department of Justice, in a manner established by the Department of Justice, for the purposes of obtaining information as to the existence and content of a record of state or federal convictions, state or federal arrests, and information as to the existence of and content of a record of state or federal arrests for which the Department of Justice establishes that the person is free on bail or on their own recognizance pending trial or appeal. (2) Upon receipt, the Department of Justice shall forward to the Federal Bureau of Investigation requests for federal summary criminal history information received pursuant to this section. The Department of Justice shall review the information returned from the Federal Bureau of Investigation and compile and disseminate a response to the Department of Financial Protection and Innovation and a fitness determination to Fidelity Corporation pursuant to subdivision (p) of Section 11105 of the Penal Code. (3) The Department of Justice shall charge a fee sufficient to cover the costs of processing the requests pursuant to this subdivision. (Amended by Stats. 2022, Ch. 452, Sec. 125. (SB 1498) Effective January 1, 2023.)
  136. 17331.1.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    People newly employed by an escrow agent must apply for a certificate, and the member must send certificate applications to Fidelity Corporation within 10 business days of employment.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17331.1. (a) Any person not previously issued a certificate must, upon employment with an escrow agent within this state, apply to Fidelity Corporation for a certificate. The member shall submit all applications for certificates to Fidelity Corporation within 10 business days of the date of employment. The person may continue employment until or unless denied a certificate by Fidelity Corporation. (b) Upon written notice by Fidelity Corporation to any or all members that any person has been denied a certificate, or has had a certificate suspended, canceled, or revoked, no member or person acting on behalf of a member shall authorize that person to have access to money or negotiable securities belonging to or in the possession of the escrow agent, or to draw checks upon the escrow agent or the trust accounts of the escrow agent. Any member or person who commits or who causes a violation of this section, which violation was either known or should have been known by the member or the person committing or causing the violation, may be subject to action by the commissioner and Fidelity Corporation as provided for in this division. (c) Each member and each person required to have a certificate shall comply with the Fidelity Corporation rules, to be approved by the commissioner, concerning the manner and timing within which Fidelity Corporation shall receive notice of employment, change of the person’s name, mailing address, or employment status, the certificate form, and the procedures for the administration thereof. Fidelity Corporation may collect a fee to cover the cost of processing the notices but no fee shall exceed twenty-five dollars ($25). (d) Fidelity Corporation shall assess the member a penalty at the rate of twenty-five dollars ($25) for every day that the member has not fully complied with this section, Section 17331, or Section 17331.2. (e) Any member that suffers a loss of trust obligations caused by any person who is required to have a certificate but has (1) failed to apply for a certificate, (2) has had the application for a certificate denied, (3) has a suspended certificate, or (4) whose certificate has been revoked shall be obligated to pay a deductible in the amount of 100 percent of the amount of the loss, notwithstanding the amount of the statutory deductible as prescribed by Section 17314.3. The failure to obtain a certificate, the denial of an application for a certificate, or the suspension, cancellation, or revocation of a certificate shall not limit the obligation of Fidelity Corporation to indemnify a member against loss of trust obligations as defined in this division. (Amended by Stats. 2004, Ch. 180, Sec. 5. Effective January 1, 2005.)
  137. 17331.2.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    Fidelity Corporation must deny, revoke, or suspend certificates on specified grounds, and it must notify the member and affected person, with appeal rights and access restrictions during appeal.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17331.2. (a) Fidelity Corporation shall deny the application for a certificate or revoke the certificate of any person, upon any of the following grounds: (1) The application contains a material misrepresentation of fact or fails to disclose a material fact so as to render the application false or misleading, or if any fact or condition exists which, if it had existed at the time of the original application for a certificate, reasonably would have warranted Fidelity Corporation to refuse originally to issue that certificate. (2) That the person has been convicted of a crime or offense, whether a felony, an offense punishable as a felony, or a misdemeanor, that involved dishonesty, fraud, deceit, embezzlement, fraudulent conversion, misappropriation of property, or any other crime reasonably related to the qualifications, functions, or duties of a person engaged in business in accordance with this division. A conviction within the meaning of this section is a plea or verdict of guilty or a conviction following a plea of nolo contendere. A conviction also includes an order granting probation and suspending the imposition of sentence, notwithstanding a subsequent order pursuant to Section 1203.4 or 1203.4a of the Penal Code permitting the person to withdraw his or her plea of guilty and to enter a plea of not guilty, or setting aside the verdict of guilty, or dismissing the accusation, information, or indictment. If, however, the conviction is more than 10 years old, or the conviction has been expunged, or the person has obtained a certificate of rehabilitation or relief under Section 1203.4 or 1203.4a of the Penal Code, or if the conviction was an infraction, then the person may have a Fidelity Corporation certificate upon showing by clear and convincing proof to a reasonable certainty that the conviction is no longer reasonably related to the qualifications, functions, or duties of a person engaged in business in accordance with this division or that person’s employment with a member. (3) That the person has been held liable in a civil action by final judgment of any court if the judgment involved dishonesty, fraud, deceit, embezzlement, fraudulent conversion, or misappropriation of property or the person has been ordered to make restitution to a victim in any criminal case involving a crime or offense set forth in paragraph (2). The person may have a Fidelity Corporation certificate upon showing by clear and convincing proof to a reasonable certainty that the judgment or restitution order is no longer reasonably related to the qualifications, functions, or duties of a person engaged in business in accordance with this division or that person’s employment with a member. (4) That the person has (A) committed or caused to be committed an act which caused any member to suffer a loss; (B) committed or caused to be committed or colluded with any other person committing any act which caused a loss, for which Fidelity Corporation or the insurer on any insurance policy or fidelity bond purchased by Fidelity Corporation, or both, to become liable to indemnify any member; or (C) committed or caused to be committed an act of dishonesty, fraud, deceit, embezzlement, fraudulent conversion, or misappropriation of property, to the material damage of a member or for which the member has been held liable to any third party, by final judgment. (5) That the person has been barred from employment by final order of the commissioner pursuant to Section 17423. (6) That the person has been deemed not qualified to serve in any capacity as a director or officer or in any other position involving management duties with a financial institution, pursuant to Division 1.8 (commencing with Section 4990). (7) That the person has been denied coverage or reinstatement by any insurer under any fidelity bond or crime policy, unless a decision of reinstatement of coverage has been made after that denial. A person who obtained a decision of reinstatement of coverage prior to the effective date of this section may have a Fidelity Corporation certificate notwithstanding paragraphs (2) and (3), unless any other ground for denial or revocation applies to that person. (b) Fidelity Corporation shall suspend the certificate of any person upon either of the following grounds: (1) That the person has been censured or suspended from any position of employment by final order of the commissioner. The certificate suspension shall be for a term concurrent with the final order of the commissioner. (2) That the person has been barred from any position of employment or management or control of any escrow agent, for a term of less than permanent, by final order of the commissioner. The certificate suspension shall be for a term concurrent with the final order of the commissioner. (c) Fidelity Corporation may suspend the certificate of any person under either of the following grounds: (1) That there is an action commenced by the commissioner to either suspend or bar that person, under Section 17423. (2) That any member with whom the person was employed has given a proof of loss or a notice of an occurrence which may give rise to a claim for a loss of trust obligations either of which identifies the person as the person responsible for the loss or as a person acting in collusion with the person causing the loss. (d) Upon denial of an application for, or upon suspension or revocation of the certificate of any person, Fidelity Corporation shall provide written notice to the member with whom that person is employed of the decision, pending any appeal therefrom which might be made. Thereafter, the member shall not allow that person to have access to money or negotiable instruments or securities belonging to or in the possession of the escrow agent, or to draw checks upon the escrow agent or the trust accounts of the escrow agent, but that person may otherwise continue in the performance and discharge of other duties of an employee. Fidelity Corporation shall notify the person in writing of the decision to deny, suspend, or revoke the certificate and of the person’s right of appeal, together with the notice of appeal. The grounds and basis for the decision shall be stated in the notice thereof. All notices may be served either personally or by mail, properly addressed to the address of record for the member and the person. (e) Any person whose application for a certificate has been denied, or whose certificate has been suspended or revoked, may appeal the decision, as provided in Section 17331.3. While that appeal is pending, the person may not have access to money or negotiable instruments or securities belonging to or in the possession of the escrow agent, or to draw checks upon the escrow agent or the trust accounts of the escrow agent, but that person may otherwise continue in the performance and discharge of other duties of an employee pending final decision of that person’s appeal. Failure to remove the person whose application has been denied, or whose certificate has been suspended or revoked, as a signer on the trust accounts may be subject to action by the commissioner as provided for in this division and shall be subject to penalties as set forth in Section 17331.1. (f) Upon expiration of the time for an appeal, or upon conclusion of the appeal, the decision to deny an application for or to suspend or revoke the certificate of any person shall become final. Fidelity Corporation shall give written notice to the member and to the person of the final decision within 10 days. Thereafter, Fidelity Corporation shall disclose in writing to all members the identity of persons whose application has been denied or whose certificate has been revoked. The person whose certificate has been denied or revoked may file a certificate reapplication after the period of time specified in Section 11522 of the Government Code, dating from the Fidelity Corporation final decision, provided that the person has satisfied all obligations to Fidelity Corporation under any prior arbitration award or judgment. (Amended by Stats. 2008, Ch. 285, Sec. 2. Effective January 1, 2009.)
  138. 17331.3.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    This section sets deadlines and procedures for appealing a denial, suspension, or revocation of a Fidelity Corporation Certificate, including notice, arbitration, superior court review, and possible cost-shifting or bond requirements.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17331.3. (a) Notice to the person, and to the member with whom the person is employed, of the decision to deny an application for or to revoke or suspend a Fidelity Corporation Certificate, shall be effective immediately upon personal delivery, or by facsimile if written acknowledgment of receipt by the member and the person is returned by facsimile, or within five days of the date of mailing, and shall become final upon expiration of the time for filing a notice of appeal or upon the conclusion of the appeal, as provided for in this section. (b) The person whose application for a certificate has been denied, or whose certificate has been suspended or revoked may, within 15 days after notice of the decision, file with Fidelity Corporation a notice of appeal and request for a hearing, by binding arbitration or judicial action, as provided herein. Neither the notice of appeal nor the request for a hearing shall stay the decision of Fidelity Corporation under Section 17331.2. A late notice of appeal and request for a hearing may be accepted upon a showing of good cause. (c) The hearing for the appeal may be resolved by arbitration in accordance with Chapter 1 (commencing with Section 1280) of Title 9 of Part 3 of the Code of Civil Procedure. The notice of the person’s right to appeal and notice of appeal provided by Fidelity Corporation shall contain a schedule of proposed arbitrators or of a proposed arbitration forum which provides a panel of arbitrators and method for appointing an arbitrator. The person filing the notice of arbitration may agree to submit the decision and matter to binding arbitration and accept an arbitrator whose name appears on the notice or may propose, in writing, an alternative arbitrator, but if Fidelity Corporation does not notify the person of acceptance of the proposed alternative arbitrator within 10 days, then either party may within 30 days petition the court to appoint an arbitrator, as provided by law. (d) If the person does not agree to submit the decision and matter to binding arbitration, then the person may, within 30 days after the notice of the decision, file an action in superior court concerning the decision to deny an application for, or to suspend or revoke the certificate. The court may, on its own motion, or shall, upon the filing of an election by any or either party, order that the action be submitted to arbitration pursuant to Chapter 2.5 (commencing with Section 1141.10) of Title 3 of Part 3 of the Code of Civil Procedure, in which case the action shall be accorded that priority for hearing as circumstances permit, unless the plaintiff may otherwise request. (e) Either Fidelity Corporation or the person whose application for a certificate has been denied, or whose certificate has been suspended or revoked, may apply to the superior court for relief to compel compliance with this section in accordance with Chapter 2 (commencing with Section 1084) of Title 1 of Part 3 of the Code of Civil Procedure. (f) Upon the conclusion of the hearing on appeal, either the arbitrator or the court may in its discretion award to the prevailing party as an item of costs, reasonable attorneys’ fees, and costs. All other expenses and fees for the arbitration incurred prior to the decision of the arbitrator or confirmation of the decision by the court shall be shared equally by the parties except for attorneys’ fees, witness fees or other expenses incurred by either party for his or her own benefit. (g) Upon the filing of any action in the superior court by the person whose application for a certificate has been denied, or whose certificate has been suspended or revoked, Fidelity Corporation at any time within 30 days after service of the summons may upon notice and hearing, move the court for an order requiring the plaintiff to furnish an undertaking to secure an award of costs and attorneys’ fees which may be awarded in the action. The motion shall be supported by affidavit showing that the action filed is frivolous and that there is no reasonable possibility that the prosecution of the action will benefit the plaintiff and that the moving party fully complied with this section and Section 17331.2. At the hearing upon the motion, the court shall consider any written or oral evidence, by witnesses or affidavit, as may be material (1) to the ground or grounds upon which the motion is based, or (2) to a determination of the probable reasonable expenses, including attorneys’ fees, of the defendant and the moving party, which will be incurred in the defense of the action. If the court determines, after hearing the evidence adduced by the parties, that the moving party has established a probability in support of any of the grounds upon which the motion is based, the court shall fix the amount of the undertaking, not to exceed twenty-five thousand dollars ($25,000), to be furnished by the plaintiff for reasonable expenses, including attorneys’ fees, which may be incurred by the moving party in connection with the action. A ruling by the court on the motion shall not be a determination of any issue in the action or of the merits thereof. If the court, upon the motion, makes a determination that a bond shall be furnished by the plaintiff, the action shall be dismissed as to the defendant, unless the bond required by the court has been furnished within a reasonable time as may be fixed by the court. Upon the filing of a motion pursuant to this subdivision, no other pleadings need be filed by the defendant and the prosecution of the action shall be stayed until 10 days after the motion has been disposed of. The motion shall be considered pursuant to this subdivision and in accordance with Chapter 2 (commencing with Section 995.010) of Title 14 of Part 2 of the Code of Civil Procedure. (Added by Stats. 1991, Ch. 1217, Sec. 4.)
  139. 17332.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    If Fidelity Corporation or the insurer pays a member’s obligation, they get subrogation rights, and the member must not prejudice those rights.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17332. When either Fidelity Corporation or the insurer providing the fidelity bond or insurance policy, if any, under Section 17310, or both, pay an obligation on behalf of a member, Fidelity Corporation and the insurer shall be subrogated to the rights, claims, and remedies of the member up to the amount paid by Fidelity Corporation and the insurer on behalf of the member. Independent of any duty or obligation of Fidelity Corporation, the member shall do nothing to prejudice those rights. In any subrogation action filed by Fidelity Corporation, the provider of the fidelity bond or insurance policy if payment was made thereunder, or both, Fidelity Corporation shall have the first right to the proceeds of any judgment or settlement obtained against the principal obligors and any other party who is held liable jointly or severally, in whole or in part, with the principal obligors, up to the amount actually paid on the claim by Fidelity Corporation. Fidelity Corporation and the insurer, as subrogees, shall also recover in the subrogation action reasonable costs and attorney’s fees which may be awarded either as part of any judgment or as an item of costs, as provided for in paragraph (10) of subdivision (a) and paragraph (5) of subdivision (c) of Section 1033.5 of the Code of Civil Procedure. No member engaged in business pursuant to Section 17200 shall be required to pay those costs and attorney’s fees awarded pursuant to this section. Amounts recouped by Fidelity Corporation through subrogation, minus all costs, attorney’s fees, and other administrative expenses incurred in obtaining that recovery, shall be credited to the fidelity fund. (Amended by Stats. 2004, Ch. 180, Sec. 7. Effective January 1, 2005.)
  140. 17333.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    The commissioner may take possession of Fidelity Corporation’s property and business, and keep possession until satisfied it will operate in conformity with the chapter, when specified violations or failures appear.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17333. The commissioner may forthwith upon written notice and order take possession of the property and business of Fidelity Corporation and retain possession until Fidelity Corporation satisfies the commissioner that it will operate in conformity with this chapter whenever it appears to the commissioner that Fidelity Corporation has done any of the following: (a) Violated its articles of incorporation or any law of this state. (b) Invested its funds in violation of Section 17337. (c) Not levied assessments as required by Sections 17320, 17321 and 17321.1. (d) Has not diligently prosecuted an action pursuant to Section 17323. (e) Violated any section of this chapter. (f) Neglected or refused to submit its books, papers, and affairs to the inspection of the commissioner. During the time the commissioner has possession the commissioner shall perform the duties and carry out the obligations of Fidelity Corporation. (Amended by Stats. 1990, Ch. 1431, Sec. 4.)
  141. 17334.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    If the commissioner has taken over Fidelity Corporation’s property and business, Fidelity Corporation may ask the superior court to stop further proceedings within 10 business days if it feels aggrieved.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17334. Whenever the commissioner has taken possession of the property and business of Fidelity Corporation, Fidelity Corporation within 10 business days after the taking, if it deems itself aggrieved thereby, may apply to the superior court in the county in which the head office of Fidelity Corporation is located to enjoin further proceedings. The court, after citing the commissioner to show cause why further proceedings should not be enjoined, and after a hearing and a determination of the facts upon the merits, may dismiss the application or enjoin the commissioner from further proceedings and direct the commissioner to surrender the property and business to Fidelity Corporation, or make a further order as may be just. (Amended by Stats. 1985, Ch. 1560, Sec. 22. Effective October 2, 1985.)
  142. 17335.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    The commissioner or Fidelity Corporation may appeal the court’s judgment. An appeal does not stay the judgment unless the court orders a stay for good cause, and Fidelity Corporation must give a bond if it appeals and wants a stay.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17335. An appeal may be taken from the judgment of the court by the commissioner or by Fidelity Corporation in the manner provided by law for appeals from the judgment of a superior court to the court of appeal. An appeal from the judgment of the court does not operate as a stay of the judgment unless the court, on good cause, so orders. No bond need be given if the appeal is taken by the commissioner, but if the appeal is taken by Fidelity Corporation a bond shall be given as required by Sections 917.2 and 917.5 of the Code of Civil Procedure as a condition to any stay. (Amended by Stats. 1998, Ch. 931, Sec. 148. Effective September 28, 1998.)
  143. 17336.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    Fidelity Corporation may investigate member claims and conduct examinations or investigations, but it must report results and recommendations to the commissioner and pay or recover certain costs as stated here.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17336. (a) Fidelity Corporation shall have independent authority to investigate claims filed by members pursuant to Section 17330. (b) Fidelity Corporation, upon submitting written notice to the commissioner, may conduct an examination or investigation of the business practices of a member’s handling and processing of trust obligations or the failure to pay an assessment under Section 17320, 17321, or 17321.1. The result of every investigation or examination shall be reported to the commissioner together with the recommendations of the Board of Directors of Fidelity Corporation. The investigation or examination reports prepared by the duly designated representatives of the board of the Escrow Agents’ Fidelity Corporation shall not be public records. (c) Fidelity Corporation may submit reports and make recommendations to a member on its findings as a result of an examination or investigation conducted pursuant to this section. These reports and recommendations shall not be public documents. A copy of all reports and recommendations shall be furnished to the commissioner by Fidelity Corporation. There shall be no liability on the part of, and no cause of action of any nature shall arise against, Fidelity Corporation or its members, directors, officers, employees, stockholders, or agents or the commissioner or commissioner’s authorized representatives for any statements made by them in any reports or recommendations made hereunder. (d) Fidelity Corporation, upon the request of the commissioner, may participate in an examination or investigation of the books and records of a member. There shall be no liability on the part of, and no cause of action of any nature shall arise against, the State of California, the commissioner, or members of the commissioner’s staff or the commissioner’s authorized representative for the release of any information furnished to Fidelity Corporation pursuant to this subdivision. (e) With the written consent of a majority of its directors, Fidelity Corporation, in order to fulfill its obligations under this section, may appoint an independent certified public accountant or public accountant or hire or appoint a specialized committee or employees to conduct an examination or investigation authorized by this section. Any reports as a result thereof shall be furnished to the commissioner pursuant to the provisions of subdivision (c). (f) For the purposes of conducting an examination or investigation, Fidelity Corporation or its appointee shall have free access to the offices and places of business, books, accounts, bank account records and statements, papers, records, files, safes and vaults of the member. (g) Fidelity Corporation may cause an examination or audit of the places of business, books, accounts, bank account records, papers, records, files, safes and vaults of a member to be conducted in accordance with Fidelity Corporation’s bylaws and rules. (h) Costs and expenses for the examination or investigation conducted pursuant to subdivision (b) shall be paid to the Fidelity Corporation by the licensee, its shareholders, directors, and officers, or person examined, each of whom shall be jointly and severally liable therefor. The Fidelity Corporation may maintain an action for recovery of these costs in any court of competent jurisdiction, and shall recover its reasonable costs and attorney’s fees as an item of costs as provided for in paragraph (10) of subdivision (a) and paragraph (5) of subdivision (c) of Section 1033.5 of the Code of Civil Procedure, provided that the payment of the costs and attorney’s fees will not cause the member to be in violation of Section 17202, 17202.1, or 17210. (i) Fidelity Corporation, any member of Fidelity Corporation, an agent of Fidelity Corporation or of its members, or any person who uses any information obtained under this section for any purpose not authorized herein is guilty of a misdemeanor. (j) Fidelity Corporation may cause an examination or audit of a member, to be conducted in accordance with Fidelity Corporation’s Bylaws and Rules, whenever: (1) The member has failed to pay an assessment as provided for under Section 17320, 17321, or 17321.1. (2) Fidelity Corporation has received any information of irregular or improper handling of the trust obligations of the member or of an occurrence which may give rise to a claim for loss of trust obligations. (3) Fidelity Corporation so elects, either with or without notice. (k) Costs and expenses for any examination under this section shall be paid for by the member. Fidelity Corporation shall also be entitled to recover costs and expenses for any examination under this section from those persons, if any, who are discovered to be responsible for, or to have caused, any irregular or improper handling of trust obligations of the member or any occurrence which may give rise to a claim for loss of trust obligations, or otherwise by failure to cooperate, unnecessarily increase the cost of the examination. Fidelity Corporation may maintain an action for recovery of these examination costs and expenses in any court of competent jurisdiction, and shall recover its reasonable costs and attorney’s fees as an item of costs, as provided for in paragraph (10) of subdivision (a) and paragraph (5) of subdivision (c) of Section 1033.5 of the Code of Civil Procedure, provided that the payment of the costs and attorney’s fees will not cause the member to be in violation of Section 17202, 17202.1, or 17210. (Amended by Stats. 1993, Ch. 492, Sec. 4. Effective January 1, 1994.)
  144. 17337.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    Fidelity Corporation may invest its funds only under the commissioner’s rules, and it must provide an authorization for disclosure of its financial records when the commissioner asks.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17337. Fidelity Corporation may invest its funds only as provided by rules of the commissioner adopted with a view to preserving reasonable liquidity. Upon request of the commissioner, Fidelity Corporation shall furnish an authorization for disclosure to the commissioner of financial records of funds pursuant to Section 7473 of the Government Code. (Amended by Stats. 1985, Ch. 1560, Sec. 25. Effective October 2, 1985.)
  145. 17339.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    Fidelity Corporation must get the commissioner’s written consent before incurring any extraordinary or nonrecurring expense.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17339. Prior to incurring any extraordinary or nonrecurring expense, Fidelity Corporation shall first obtain the written consent of the commissioner. (Amended by Stats. 1988, Ch. 1458, Sec. 26. Effective September 28, 1988.)
  146. 17340.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    The board of directors of Fidelity Corporation may borrow money against its assets, including future assessments, if it thinks doing so is necessary and prudent and gets the commissioner’s written consent.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17340. In the event the board of directors of Fidelity Corporation deem it necessary and prudent to raise additional moneys for payment of claims or expenses of administration, it may, with the commissioner’s written consent, borrow money against its assets, including future assessments. (Repealed and added by Stats. 1988, Ch. 1458, Sec. 28. Effective September 28, 1988.)
  147. 17341.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    The commissioner must give prompt notice to Fidelity Corporation when taking possession of a member’s property and business, and again when deciding to liquidate it.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17341. The commissioner shall give prompt notice to Fidelity Corporation when the commissioner takes possession of the property and business of a member and shall give further prompt notice when the commissioner determines to liquidate the property and business of a member. (Amended by Stats. 1985, Ch. 1560, Sec. 29. Effective October 2, 1985.)
  148. 17342.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    Memberships issued by Fidelity Corporation cannot be transferred and are exempt from the Corporate Securities Law of 1968.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17342. Memberships issued by Fidelity Corporation shall be nontransferable and shall be exempt from the provisions of the Corporate Securities Law of 1968. (Amended by Stats. 1985, Ch. 1560, Sec. 30. Effective October 2, 1985.)
  149. 17343.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    No provision of the Insurance Code applies to Fidelity Corporation.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17343. No provision of the Insurance Code shall apply to Fidelity Corporation. (Amended by Stats. 1985, Ch. 1560, Sec. 31. Effective October 2, 1985.)
  150. 17344.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    Fidelity Corporation is subject to regulation by the commissioner and designated representatives, who may investigate it and have free access to its offices and records.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17344. The operation of Fidelity Corporation shall at all times be subject to the regulation of the commissioner and the commissioner’s duly designated representatives. The commissioner and the commissioner’s duly designated representatives may at any time investigate the affairs and examine the books, accounts, records, and files used by Fidelity Corporation. The commissioner and the commissioner’s duly designated representatives shall have free access to the offices, books, accounts, papers, records, files, safes, and vaults of Fidelity Corporation. (Amended by Stats. 1985, Ch. 1560, Sec. 32. Effective October 2, 1985.)
  151. 17345.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    An aggrieved member may appeal a Fidelity Corporation action or decision to the commissioner within 30 days. The commissioner must decide the appeal within 60 days, and that decision is final.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17345. Any member aggrieved by any action or decision of Fidelity Corporation may appeal to the commissioner within 30 days from the action or decision, except that all matters relating to claims for loss of trust obligations shall be decided under Section 17345.1. The commissioner’s decision on appeal shall be made within 60 days from the date of the appeal and shall be considered final. (Repealed and added by Stats. 1997, Ch. 370, Sec. 3. Effective January 1, 1998.)
  152. 17345.1.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    This section sets deadlines and procedures for a hearing request, the hearing process, and limited abstention by the commissioner.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17345.1. (a) A member or successor in interest aggrieved by any action or decision of Fidelity Corporation may file a written request for a hearing with the commissioner within 30 days from the action or decision. (b) (1) Except as provided in subdivision (c), the hearing shall be conducted by an administrative law judge on the staff of the Office of Administrative Hearings and the administrative law judge’s proposed decision shall be made within 120 days from the date of the request for hearing. This time limit does not constitute a jurisdictional deadline and may be extended by stipulation of the parties or by order of the administrative law judge for good cause. (2) The hearing shall be conducted in accordance with the administrative adjudication provisions of Chapters 4.5 (commencing with Section 11400) and Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code, except as specified in this subdivision. (3) The following sections of the Government Code shall not apply to a hearing under this subdivision: Section 11503 (relating to accusations), Section 11504 (relating to statements of issues), Section 11505 (relating to contents of the statement to respondent), Section 11506 (relating to the notice of defense), Section 11507 (relating to amended or supplemental accusations), and Section 11516 (relating to amendment of accusations after submission of case). (4) The sole parties to the hearing shall be the member or successor in interest (complainant) and Fidelity Corporation (respondent). Third-party intervention shall not be permitted. The disputes, claims, and interests of third parties shall not be within the jurisdiction of the proceedings. However, nothing in this paragraph prohibits any interested party from submitting an amicus brief upon approval by the administrative law judge, after a duly noticed motion demonstrating good cause. (5) Within 10 days of receipt of the request for a hearing, the commissioner shall schedule the hearing with the Office of Administrative Hearings and shall serve each party by personal service or mail with notice of the hearing, which is to include the date, time, and place of the hearing. (A) Within 10 days of service of the notice of hearing, the complainant shall file with the Office of Administrative Hearings, and serve upon the respondent by personal service or mail, a written statement setting forth the matters to be considered at the hearing in sufficient detail to permit the respondent to prepare and present its response. The statement shall contain the following: (i) A brief statement of the facts that give rise to the hearing. (ii) A statement of the issues to be considered at the hearing including relevant statutes and rules. If the statement includes issues not raised in the proof of loss claim or considered by respondent in its decision, respondent may move for abatement of the proceedings for consideration of those issues by respondent. The administrative law judge may abate the proceedings for a period not to exceed 60 days from the issuance of the order to abate. The administrative law judge may extend the time period for good cause upon motion by respondent or by stipulation of the parties. If respondent has not issued a revised decision within the period of abatement, the administrative law judge shall reset the matter for hearing. (B) Within 20 days of service of the statement, respondent may file with the Office of Administrative Hearings, and serve upon the complainant by personal service or mail a written response to the statement. (C) The statement of issues and response may be amended upon completion of discovery, except that notice of the amendment shall be no later than 30 days before the date set for hearing. (6) Where the statement of issues includes a claim for a loss of trust obligations that has been denied by respondent, complainant shall bear the burden of establishing by a preponderance of the evidence that a loss as defined in Section 17304 has occurred and that respondent is required to pay the claim in accordance with this chapter. Each legal issue shall be adjudicated in the proposed decision and the commissioner’s decision, except for any issue either withdrawn or waived by complainant or respondent, upon the submission of the case after hearing. (7) Any party may move for a judgment on the pleadings or summary judgment, as a dispositive motion, pursuant to the Rules of Procedure of the Office of Administrative Hearings. The evidence in support of and standards for deciding the motions shall be as set forth in the Code of Civil Procedure. If the administrative law judge denies the motion, the matter shall be heard on the merits by the administrative law judge. If the administrative law judge grants the motion, the order shall be in the form of a proposed decision to the commissioner pursuant to subdivision (b) of Section 11517 of the Government Code. (8) Nothing in this section shall be construed to require the losing party to pay the other party’s costs and expenses, including attorney’s fees. (9) If the statement of issues is abated and respondent issues a revised decision, the parties may amend their pleadings within a reasonable period of time, as ordered by the administrative law judge. (c) (1) If a request for hearing includes a claim for loss of trust obligations that has been denied by Fidelity Corporation and the claim involves the factors described in paragraph (3), the commissioner, upon the request of Fidelity Corporation and as provided herein, shall abstain from proceeding with a hearing. The matter may be adjudicated in a court of competent jurisdiction upon the filing of an action by the member or successor in interest. Fidelity Corporation shall notify the commissioner, in writing, of the grounds for abstention of jurisdiction within five days of the filing of the request for a hearing by the member or successor in interest. The commissioner shall rule on the abstention of jurisdiction request within 10 days of the notice and the ruling shall be considered final. In making a determination on the request for abstention, the commissioner may examine and investigate all facts connected with the request for abstention and may request information from any person as deemed necessary. (2) If the commissioner denies the request for abstention of jurisdiction, the hearing shall be conducted in accordance with subdivision (b), except that compliance by the commissioner with paragraph (5) of subdivision (b) shall be within five days of the ruling denying the abstention request. (3) The factors requiring abstention of jurisdiction by the commissioner are as follows: (A) The claim for a loss is based upon an alleged escrow transaction in which an officer, director, trustee, stockholder, manager, or employee of the member was a principal to the transaction. (B) The claim involves (i) the need to determine conflicting claims or disputes to real property and (ii) there is a potential for double recovery by any principal to an escrow. (4) The commissioner shall abstain if determination of the claim will cause some escrows to have preferable or favorable treatment over the other escrows held by the member or successor in interest. (Amended by Stats. 2011, Ch. 296, Sec. 97. (AB 1023) Effective January 1, 2012.)
  153. 17346.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    Fidelity Corporation and its members must not make false or misleading advertising claims about trust-obligation guarantees, and most such statements need prior commissioner approval.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17346. (a) Fidelity Corporation and its members shall not advertise, print, display, publish, distribute, or broadcast, or cause or permit to be advertised, printed, displayed, published, distributed, or broadcast, in any manner any statement or representation with regard to a guarantee of trust obligations in their advertisements that is false or misleading or calculated to deceive or misinform the public. Any statement or representation with regard to a guarantee of trust obligations, except the statement set forth in subdivision (b), shall be reviewed and approved by the commissioner prior to its use. (b) Any advertising referring to Fidelity Corporation shall state in a clear and conspicuous manner, the following statement: “MEMBER OF ESCROW AGENTS’ FIDELITY CORPORATION (EAFC). EAFC PROVIDES FIDELITY COVERAGE TO ITS MEMBERS. EAFC IS NOT A GOVERNMENT AGENCY, AND THERE IS NO GUARANTEE OF A PAYMENT OF ANY CLAIM BY THE STATE OF CALIFORNIA.” (c) Neither Fidelity Corporation nor its members shall advertise that trust obligations of escrow agents are “protected,” “guaranteed,” “insured,” or use words to that effect. (Amended by Stats. 2007, Ch. 237, Sec. 2. Effective January 1, 2008.)
  154. 17347.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    The Secretary of State cannot file incorporation papers or amendments for Fidelity Corporation unless the commissioner has given written approval, and Fidelity Corporation cannot adopt bylaws or amendments without the commissioner’s written consent.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17347. (a) The Secretary of State shall not file articles for the incorporation of Fidelity Corporation or an amendment to the articles unless the commissioner has issued a written approval of the articles or amendment. (b) Fidelity Corporation shall not adopt any bylaws or amendments thereto without the written consent of the commissioner. Within 60 calendar days from the receipt of any bylaws or amendments thereto, submitted to the commissioner, the commissioner shall inform Fidelity Corporation, in writing, that the bylaws or amendments are not disapproved, or that those bylaws or amendments are disapproved and specify the information needed to complete the submittal. Within 60 calendar days from the receipt of a complete submittal, the commissioner shall reach a decision on the submittal. (Amended by Stats. 1992, Ch. 476, Sec. 6. Effective January 1, 1993.)
  155. 17348.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    The commissioner must provide annual licensee and escrow-liability information to Fidelity Corporation, and each member must file escrow-liability schedules and a list of key personnel by February 15.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17348. In order to permit Fidelity Corporation to fulfill its obligation under this chapter, the commissioner shall furnish a list of all persons licensed under this division as of December 31 of each year and a copy of an escrow liability schedule filed with the commissioner. Each member on or before February 15 shall furnish to the commissioner and Fidelity Corporation the schedule of its escrow liability for each of its licensed locations as of the last day of each month for the preceding 12 months which ended December 31. A list of officers, directors, stockholders, trustees, agents, managers, and employees as of that date shall also be submitted to Fidelity Corporation, with the schedule. The schedule shall be in the form and contain such information as the commissioner may require. (Amended by Stats. 1993, Ch. 492, Sec. 5. Effective January 1, 1994.)
  156. 17349.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    If Fidelity Corporation is dissolved, and with the commissioner’s approval, its net assets must be distributed to members after all liabilities are settled.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17349. If Fidelity Corporation is dissolved, subject to the approval of the commissioner, the net assets after settling all liabilities shall be distributed to the members on the basis of the number of each member’s licensed locations compared to the total number of all members’ licensed locations. (Amended by Stats. 1985, Ch. 1560, Sec. 36. Effective October 2, 1985.)
  157. 17350.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. )

    Verify source ↗

    Fidelity Corporation must pay the commissioner’s administration costs and expenses for this chapter, and the commissioner may sue to recover them.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2.5. Escrow Agents’ Fidelity Corporation [17300 - 17350] ( Heading of Chapter 2.5 amended by Stats. 1988, Ch. 1458, Sec. 1. ) ## ARTICLE 4. General Provisions [17330 - 17350] ( Article 4 added by Stats. 1982, Ch. 1106, Sec. 1. ) ## 17350. All costs and expenses incurred by the commissioner in the administration of this chapter shall be paid to the commissioner by Fidelity Corporation. The limitation on the total assessment for each year set forth in paragraph (1) of subdivision (e) of Section 17207 shall not apply to Fidelity Corporation’s payment of costs and expenses incurred by the commissioner in the administration of this chapter. The commissioner may institute an action for the recovery of costs and expenses incurred in the administration of this chapter in any court of competent jurisdiction. (Amended by Stats. 1985, Ch. 1560, Sec. 37. Effective October 2, 1985.)
  158. 17400.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    The commissioner may issue, change, and отменa rules, forms, and orders, define terms, classify people and matters, set different requirements for different classes, and waive requirements when appropriate.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17400. The commissioner may from time to time make, amend, and rescind the rules, forms, and orders that are necessary to carry out the provisions of this division, and define any terms, whether or not used in this division, insofar as the definitions are not inconsistent with the provisions of this division. For the purpose of rules and forms, the commissioner may, among other things, classify persons and matters within the commissioner’s jurisdiction and may prescribe different requirements for different classes. The commissioner may, in the commissioner’s discretion, waive any requirement of any rule or form in situations where in his or her opinion the requirement is not necessary in the public interest or for the protection of the public. (Amended by Stats. 1999, Ch. 441, Sec. 8. Effective January 1, 2000.)
  159. 17402.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    Escrow agents and their officers must not advertise or publish statements about capital except for amounts fully paid in and accumulated surplus.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17402. No person subject to this division or any officer thereof shall advertise in any manner or publish any statement of its capital, other than amounts fully paid in and accumulated surplus. (Amended by Stats. 1961, Ch. 475.)
  160. 17403.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    People subject to this division may not use escrow-business advertising or stationery unless they are licensed escrow agents; the commissioner may order a violator to stop, and the order can be rescinded if a hearing request is filed within 30 days and no hearing is held within 60 days.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17403. (a) No person subject to this division shall issue, circulate, or publish any advertisement by any means of communication, or make use of or circulate any letterheads, billheads, blank notes, blank receipts, blank escrow instructions, certificates, circulars, or any written, printed, partially written or printed paper containing any fictitious or corporate name or other words indicating that the person is in the escrow business, unless the person is a licensed escrow agent. (b) If, in the opinion of the commissioner, any person has violated this section, the commissioner may order that person to desist and refrain from that violation. If, within 30 days after the order is served, a request for hearing is filed in writing and the hearing is not held within 60 days thereafter, the order is rescinded. (Amended by Stats. 1987, Ch. 564, Sec. 1.)
  161. 17403.1.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    Persons subject to this division must not call a transaction an escrow unless it is defined as an escrow in Section 17003.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17403.1. No person subject to this division shall describe as an escrow, whether orally, in writing, or electronically, any transaction that is not defined as such in Section 17003. (Amended by Stats. 1999, Ch. 441, Sec. 10. Effective January 1, 2000.)
  162. 17403.2.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    Escrow agents subject to this division must not accept or allow blank or altered escrow instructions unless the change is signed or initialed by everyone who signed before the change.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17403.2. (a) No person subject to this division shall solicit or accept an escrow instruction or amended or supplemental escrow instruction containing any blank to be filled in after signing or initialing of the escrow instruction or amended or supplemental escrow instruction, nor permit any person to make any addition to, deletion from, or alteration of an escrow instruction or amended or supplemental escrow instruction, unless the addition, deletion or alteration is signed or initialed by all persons who had signed or initialed the escrow instruction or amended or supplemental escrow instruction prior to the addition, deletion or alteration. (b) In addition to subdivision (a), no Internet escrow agent subject to this division shall solicit or accept electronically over the Internet an escrow instruction or amended or supplemental escrow instruction containing any blank to be filled in after executing that escrow instruction or amended or supplemental escrow instruction, nor permit any person to electronically, over the Internet, make any addition to, deletion from, or alteration of an escrow instruction or amended or supplemental escrow instruction, unless that addition, deletion or alteration is executed by all persons who had executed the escrow instruction or amended or supplemental escrow instruction prior to the addition, deletion, or alteration. (Amended by Stats. 1999, Ch. 441, Sec. 11. Effective January 1, 2000.)
  163. 17403.3.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    Escrow instructions must be delivered to everyone who signs them; internet escrow agents must send them electronically, or mail a true and correct copy within 24 hours if the person cannot receive them electronically.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17403.3. (a) At the time of execution a copy of each escrow instruction or amended or supplemental escrow instruction shall be delivered to all persons executing the same. (b) Internet escrow agents shall deliver electronically over the Internet a copy of each executed escrow instruction or amended or supplemental escrow instruction to all persons executing the same. In the event a person is not able to electronically receive the instructions, the Internet escrow agent shall mail a true and correct copy of the instructions to the person within 24 hours of execution. (Amended by Stats. 1999, Ch. 441, Sec. 12. Effective January 1, 2000.)
  164. 17403.4.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    Escrow instructions executed by a buyer or seller must include a statement in at least 10-point type with the license name and the issuing department or operating authority.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17403.4. All written escrow instructions and all escrow instructions transmitted electronically over the Internet executed by a buyer or seller, whether prepared by a person subject to this division or by a person exempt from this division under Section 17006, shall contain a statement in not less than 10-point type which shall include the license name and the name of the department issuing the license or authority under which the person is operating. This section shall not apply to supplemental escrow instructions or modifications to escrow instructions. This section shall become operative on July 1, 1993. (Amended by Stats. 1999, Ch. 441, Sec. 13. Effective January 1, 2000.)
  165. 17403.5.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    An Internet escrow agent may keep certain required records electronically, send them electronically to the commissioner, make certain account transfers electronically, and deliver account statements by email or over the Internet unless the customer asks otherwise.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17403.5. (a) All records required by this chapter may be retained by an Internet escrow agent and provided to the commissioner in electronic format. (b) All transfers by an Internet escrow agent between trust accounts and interest-bearing accounts, and between escrow accounts, may be made electronically. (c) A statement of account may be delivered by an Internet escrow agent to a customer by electronic mail or via the Internet, unless otherwise requested by the customer. (Added by Stats. 2000, Ch. 437, Sec. 5. Effective January 1, 2001.)
  166. 17404.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    People subject to this division must keep and use business books, accounts, and records that let the commissioner determine compliance with the division and the commissioner’s rules.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17404. Every person subject to this division shall keep and use in its business, books, accounts, and records which will properly enable the commissioner to determine whether the escrow functions performed by such person comply with the provisions of this division and with all rules made by the commissioner under this division. (Amended by Stats. 1973, Ch. 705.)
  167. 17405.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    The commissioner may inspect escrow agents’ business records and must examine licensed escrow agents at least every 48 months.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17405. (a) The business, accounts and records of every person performing as an escrow agent, whether required to be licensed under this division or not, are subject to inspection and examination by the commissioner at any time without prior notice. The provisions of this section shall not apply to persons specified in Section 17006. (b) Any person subject to this division shall, upon request, exhibit and allow inspection and copying of any books and records by the commissioner or his or her authorized representative. (c) (1) The commissioner shall conduct an examination of each licensed escrow agent as described in subdivision (a) as often as the commissioner deems necessary and appropriate, but not less than once every 48 months. (2) The examination shall be conducted for the 12-month period immediately preceding the date that the examination is commenced unless the commissioner finds, based on information uncovered in the examination or in the most recent independent audit report, that the examination should be extended beyond the 12-month period. (3) In determining how often an examination shall be conducted, the commissioner may consider each licensed escrow agent’s compliance with the requirements set forth in this division and other factors the commissioner may by rule or order designate. (4) This subdivision shall apply only to examinations commenced after the effective date established by the rule or order of the commissioner for the factors described in paragraph (3). (d) Notwithstanding subdivision (c), the commissioner may conduct an indoctrination or preliminary examination, or both, under this section of any new licensee within one year of the issuance of the license under this division, and an examination described in subdivision (a) within two years of the issuance of the license under this division. (Amended by Stats. 2001, Ch. 499, Sec. 3. Effective January 1, 2002.)
  168. 17405.1.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    A licensee or other covered person must pay the commissioner the cost of inspections and examinations. The commissioner may also sue to recover those costs and may calculate them using an estimated average hourly cost.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17405.1. The cost of every inspection and examination of a licensee or other person subject to this division shall be paid to the commissioner by the licensee or person examined, and the commissioner may maintain an action for the recovery of these costs in any court of competent jurisdiction. In determining the cost of an inspection or examination, the commissioner may use the estimated average hourly cost for all persons performing inspections or examinations of licensees or other persons subject to this division for the fiscal year. For the purposes of this section only, no person other than a licensee shall be deemed to be a person subject to this division unless and until the person is determined to be a person subject to this division by an administrative hearing in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code or by a judicial hearing in any court of competent jurisdiction. (Amended by Stats. 1981, Ch. 946, Sec. 3.)
  169. 17406.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    Licensees must file annual or requested audit/financial reports with the commissioner, and the commissioner may require more information, reject filings, extend deadlines, and grant some exemptions.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17406. (a) Each licensee shall submit to the commissioner, at the licensee’s own expense, an audit report containing audited financial statements covering the calendar year or, if the licensee has an established fiscal year, then for that fiscal year, within 105 days after the close of the calendar or fiscal year, as applicable. At that time, each licensee shall also file additional relevant information as the commissioner may require. (b) Within 30 days after receipt of a request from the commissioner, a licensee or other person subject to this division shall submit to the commissioner, at the person’s own expense, an audit report containing audited financial statements covering the 12 calendar months next preceding the month of receipt of the request, or for another period as the commissioner may require. Unless the public interest shall otherwise require, the commissioner shall exempt a licensee from the provisions of subdivision (a) in whole or in part if the licensee has complied with a request pursuant to this subdivision as of a date within the calendar or fiscal year for which the exemption is granted. (c) A licensee whose license has been revoked shall submit to the commissioner, at its own expense, on or before 105 days after the effective date of the revocation, a closing audit report as of that effective date, or for another period as the commissioner may specify. The report shall include the information specified by the commissioner. A licensee who has complied with this subdivision is exempt from subdivision (a) of this section. (d) The reports and financial statements referred to in subdivisions (a) and (b) shall include at least a balance sheet and a statement of income for the year ended on the balance sheet date together with other relevant information as the commissioner may require. The reports and financial statements referred to in subdivisions (a), (b), and (c) shall be prepared in accordance with generally accepted accounting principles, and shall be accompanied by a report, certificate, or opinion of, an independent certified public accountant or independent public accountant. The audits shall be conducted in accordance with generally accepted auditing standards and the rules of the commissioner. (e) A licensee shall make other special reports to the commissioner as the commissioner may from time to time require. (f) For good cause and upon written request, the commissioner may extend the time for compliance with subdivisions (a) and (b). (g) A licensee shall, when requested by the commissioner, submit its unaudited financial statements, prepared in accordance with generally accepted accounting principles and consisting of at least a balance sheet and statement of income and expense as of the date and for the period specified by the commissioner. The commissioner may require the submission of these reports on a monthly or other periodic basis. (h) If the report, certificate, or opinion of the independent accountant referred to in subdivision (d) is in any way qualified, the commissioner may require the licensee to take action as he or she deems appropriate to permit an independent accountant to remove the qualifications from the report, certificate, or opinion. (i) The commissioner may reject any financial statement, report, certificate, or opinion by notifying the licensee or other person required to make the filing of its rejection and the cause of the rejection. Within 30 days after the receipt of the notice, the licensee or other person shall correct the deficiency and the failure so to do shall be deemed a violation of this division. The commissioner shall retain a copy of all rejected filings. (j) The commissioner may make rules specifying the form and content of the reports and financial statements referred to in this section, and may require that those reports and financial statements be verified by the licensee in the manner as he or she may prescribe. (k) Upon completion of the reports and financial statements referred to in subdivisions (a), (b), and (c), the independent accountant shall submit to the commissioner complete copies of the reports and financial statements at the same time that copies of the reports and financial statements are submitted to the licensee. (l) A licensee who engages an independent accountant or other third-party contractor to reconcile trust account records shall request the independent accountant or third-party contractor, at a minimum, to immediately notify the commissioner and Fidelity Corporation in the event of any of the following: (1) The termination or voluntary withdrawal of the independent accountant or third-party contractor from the engagement. (2) The discovery by the independent accountant or third-party contractor of an unreconcilable trust account debit balance. A debit balance exists if an escrow agent withdraws, pays out, or transfers money from an escrow account in excess of the amount to the credit of that account at the time of the withdrawal, payment, or transfer. (3) The discovery by the independent accountant or third-party contractor that trust account reconciliations have not been performed for two months after the end of any calendar month. (4) The discovery by the independent accountant or third-party contractor of exception items in trust account exception reports, that remain uncorrected for two months after the end of any calendar month. Notification pursuant to this subdivision may be accomplished by transmitting to the commissioner and Fidelity Corporation, in either electronic or paper form, copies of trust account reconciliation exception reports. Nothing in this subdivision imposes any duty or obligation on an independent accountant or third-party contractor to Fidelity Corporation, members of Fidelity Corporation, or the commissioner. (m) Nothing in this section shall be deemed to require a licensee to contract with a third party to reconcile trust account records. (Amended by Stats. 2008, Ch. 285, Sec. 3. Effective January 1, 2009.)
  170. 17406.1.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    If a licensee changes accountants for certain reports, it must notify the commissioner in writing about any disagreement with the former accountant, get the notice signed by the chief executive officer, ask the former accountant for a response letter, and file both documents within 30 days.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17406.1. (a) Whenever the reports and financial statements required pursuant to subdivision (a), (b), or (c) of Section 17406 are to be reported upon or certified by an accountant other than the accountant reporting upon or certifying the licensee’s most recent reports or financial statements, the licensee shall furnish the commissioner with a written notice stating whether there was any disagreement with the former accountant on any matter in connection with the preparation of the most recent reports or financial statements reported upon or certified by that former accountant. If there was any disagreement, the licensee’s written notice shall describe the reasons for the disagreement. The written notice shall be signed by the chief executive officer of the licensee. The licensee shall also request, in writing, that the former accountant furnish the licensee with a letter addressed to the commissioner stating whether the former accountant agrees with the statements contained in the licensee’s written notice. If the former accountant disagrees with any of the licensee’s statements, the former accountant’s letter shall explain the reasons for disagreeing with the licensee’s statements. The written notice of the licensee, along with the former accountant’s letter shall be filed with the commissioner no later than 30 days from the date of engagement of the new accountant. (b) The written notice of the licensee required by subdivision (a) shall be considered a notice for purposes of Section 17702. (Added by Stats. 1994, Ch. 496, Sec. 3. Effective January 1, 1995.)
  171. 17408.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    If a person subject to this division misses a required report or requested information deadline, the commissioner may examine records and impose a daily penalty.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17408. (a) If any person subject to this division fails to make any report required by law or by the commissioner, the commissioner may immediately cause the books, records, papers, and affairs of said person to be thoroughly examined. (b) The commissioner may impose, by order, a penalty on any person who fails, within the time specified in any written demand of the commissioner, (1) to make and file with the commissioner any report required by law or requested by the commissioner, or (2) to furnish any material information required by the commissioner to be included in the report. The amount of the penalty may not exceed one hundred dollars ($100) for each day for the first five days the report or information is overdue, and thereafter may not exceed five hundred dollars ($500) for each day the report or information is overdue. (c) If, after an order has been made under subdivision (b), a request for hearing is filed in writing within 30 days of the date of service of the order by the person to whom the order was directed, a hearing shall be held in accordance with the Administrative Procedure Act, Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code, and the commissioner shall have all the powers granted under that chapter. (d) If the person fails to file a written request for a hearing within 30 days of the date of service of the order, the order imposing the penalty shall be deemed a final order of the commissioner, and the penalty shall be paid within five business days. (e) If a hearing is requested, the penalty shall be paid within five business days after the effective date of any decision in the case ordering payment to be made. (Amended by Stats. 2005, Ch. 257, second Sec. 2. Effective January 1, 2006.)
  172. 17409.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    Escrow funds must be kept in specified noninterest-bearing accounts first, and licensees must maintain separate escrow trust accounts and arrange notice to the commissioner and Fidelity Corporation for account closure or overdraft events.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17409. (a) All moneys deposited in escrow to be delivered upon the close of the escrow or upon any other contingency shall be deposited and maintained in a noninterest-bearing demand or checking account in a bank, a state or federal savings bank, or a state or federal savings association or in a noninterest-bearing account subject to immediate withdrawal in an industrial loan company insured by the Federal Deposit Insurance Corporation and approved to receive those moneys by the commissioner. Thereafter, these moneys may be deposited in an interest-bearing account in a bank, a state or federal savings bank, a state or federal savings association, an industrial loan company approved to receive those moneys by the commissioner, or a state or federal credit union, if the depositor is qualified for membership under the bylaws of that credit union, and the moneys are maintained separate, distinct, and apart from funds belonging to the escrow agent. Those funds, when deposited, are to be designated as “trust funds,” “escrow accounts,” or under some other appropriate name indicating that the funds are not the funds of the escrow agent. Upon request of the commissioner, a licensee shall furnish to the commissioner an authorization for examination of financial records of any trust funds or escrow accounts, maintained in a financial institution, in accordance with the procedures set forth in Section 7473 of the Government Code. (b) A licensee engaged in the business of receiving escrows for deposit or delivery of the types specified in subdivision (c) of Section 17312 and of the types not specified therein shall maintain separate escrow trust accounts, for both types of escrow business in the same manner as provided in subdivision (a) of this section and Sections 17409.1, 17410, 17411, and 17411.1. (c) Any agreement with a financial institution to establish a trust account pursuant to this section shall be accompanied by a letter from the licensee authorizing and requesting that the financial institution immediately notify the commissioner and Fidelity Corporation, in either electronic or paper form, when it becomes aware of either of the following: (1) The closure of any account subject to this section, other than to transfer the funds to another designated trust account at the same financial institution in the name of the escrow agent or the remittance of the funds to the Controller’s office for escheat purposes. (2) The occurrence of any overdraft balance in an account subject to this section. This subdivision does not impose any duty or obligation on a financial institution to Fidelity Corporation, members of Fidelity Corporation, or the commissioner. (Amended by Stats. 2009, Ch. 140, Sec. 72. (AB 1164) Effective January 1, 2010.)
  173. 17409.1.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    People subject to this chapter must keep separate escrow trust accounts for each licensed location, and transfers between accounts are generally prohibited unless handled by specified check-and-receipt steps. Internet escrow companies may use wire transfers for certain trust-account and loss-covering transfers, and may keep receipts electronically.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17409.1. (a) Each person subject to this chapter shall maintain separate escrow trust accounts for each licensed location. Transfers between accounts are prohibited except by the actual writing of a check from one escrow to the other, and by depositing the check for the account of, and the writing of a receipt for the escrow to which the funds are being transferred. Each transfer shall be properly supported and documented in escrow files by inclusion of escrow instructions executed by the principals authorizing the transfer. (b) With regard to Internet escrow companies, transfers to trust accounts by commercial banks and from operating accounts to cover losses may be made through wire transfer. Receipts for all these transactions may be maintained in electronic form. (Amended by Stats. 2000, Ch. 437, Sec. 6. Effective January 1, 2001.)
  174. 17410.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    Escrow or trust funds, and interest on escrowed funds, are protected from money judgment enforcement against the licensee or escrow agent, and the funds may not be treated as the licensee’s asset.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17410. (a) Escrow or trust funds are not subject to enforcement of a money judgment arising out of any claim against the licensee or person acting as escrow agent, and in no instance shall such escrow or trust funds be considered or treated as an asset of the licensee or person performing the functions of an escrow agent. (b) Interest paid or payable on funds deposited in escrow by a licensee are not subject to enforcement of a money judgment arising out of any claim against the licensee or person acting as escrow agent. (Amended by Stats. 1982, Ch. 497, Sec. 93. Operative July 1, 1983, by Sec. 185 of Ch. 497.)
  175. 17411.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    A person must not knowingly keep or arrange for funds or money to be held in a bank or savings and loan account labeled as trust funds or escrow accounts, unless they are actual escrow or trust funds deposited with that agency.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17411. No person shall knowingly keep or cause to be kept any funds or money in any bank or state or federal savings and loan association under the heading of “trust funds” or “escrow accounts” or any other name designating such funds or money as belonging to the clients of any escrow agency, except actual escrow or trust funds deposited with such agency. (Amended by Stats. 1979, Ch. 475.)
  176. 17411.1.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    For Sections 17409, 17410, and 17411, “trust funds” or “escrow accounts” also include funds an escrow agent must hold because of a federal or state law or a government agency requirement.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17411.1. “Trust funds” or “escrow accounts” as used in Sections 17409, 17410, and 17411 shall include all funds required to be held by an escrow agent pursuant to a federal or state law, or requirement of a governmental agency. (Added by Stats. 1982, Ch. 663, Sec. 11.)
  177. 17414.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    Certain escrow-related people must not misuse escrow funds or make material false statements, and some must report known misappropriation immediately in writing.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17414. (a) It is a violation for any person subject to this division or any director, stockholder, trustee, officer, agent, or employee of any such person to do any of the following: (1) Knowingly or recklessly disburse or cause the disbursal of escrow funds otherwise than in accordance with escrow instructions, or knowingly or recklessly to direct, participate in, or aid or abet in a material way, any activity which constitutes theft or fraud in connection with any escrow transaction. (2) Knowingly or recklessly make or cause to be made any misstatement or omission to state a material fact, orally or in writing, in escrow books, accounts, files, reports, exhibits, statements, or any other document pertaining to an escrow or escrow affairs. (b) Any director, officer, stockholder, trustee, employee, or agent of an escrow agent, who abstracts or willfully misappropriates money, funds, trust obligations or property deposited with an escrow agent, is guilty of a felony. Upon conviction, of an offense under this section or similar offenses specified in Chapter 4 (commencing with Section 470), Chapter 5 (commencing with Section 484), or Chapter 6 (commencing with Section 503) of Title 13 of Part 1 of the Penal Code, the court shall, in addition to any other punishment imposed, order the person to make full restitution, first to the escrow agent and then to Fidelity Corporation, to the extent it has indemnified the escrow agent. Nothing in this section shall be deemed or construed to repeal, amend, or impair any existing provision of law prescribing a punishment for such an offense. (c) Any person subject to this division who knows of a person’s involvement in an abstraction or misappropriation of money, funds, trust obligations, or property deposited with a licensed escrow agent shall immediately report the abstraction or misappropriation in writing to the commissioner and to Fidelity Corporation. No person shall be civilly liable for reporting as required under this subdivision, unless the information provided in the report is false and the person providing false information does so with knowledge and malice. The reports filed under this section, including the identity of the person making the filing, shall remain confidential pursuant to state law. (Amended by Stats. 1994, Ch. 423, Sec. 2. Effective January 1, 1995.)
  178. 17414.1.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    Certain people with recent specified convictions or judgments may not work in escrow roles, and escrow agents must screen new hires and send fingerprint information to the commissioner.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17414.1. (a) Any person who has been convicted of or pleaded nolo contendere to any crime specified in subdivision (b) within the past 10 years, or has been held liable in any civil action by final judgment or any administrative judgment by any public agency within the past 7 years, of any of the provisions specified in subdivision (b) shall not serve in any capacity as an officer, director, stockholder, trustee, agent, or employee of an escrow agent, or in any position involving any duties with an escrow agent, in this state. This subdivision shall not apply to any person whose office, employment, ownership interest, or other participation in the business of a licensed escrow agent commenced prior to January 1, 1992. (b) (1) Subdivision (a) applies to criminal convictions of, pleas of nolo contendere to, or civil or administrative judgments entered for, any of the following offenses: (A) Offenses specified in Chapter 10 (commencing with Section 1320) of Division 1.1. (B) Offenses specified in Article 4 (commencing with Section 5300) of Chapter 1 of Division 2. (C) Offenses specified in Article 8 (commencing with Section 14750) of Chapter 4 of Division 5. (D) Offenses specified in Chapter 3 (commencing with Section 17400), and Chapter 7 (commencing with Section 17700) of Division 6. (E) Offenses specified in Chapter 6 (commencing with Section 18435) of Division 7. (F) Offenses specified in provisions of the laws of the United States added or amended by the federal Financial Institutions Reform, Recovery and Enforcement Act of 1989 (Public Law 101-73). (G) Offenses involving robbery, burglary, theft, embezzlement, fraud, fraudulent conversion or misappropriation of property, forgery, bookmaking, receiving stolen property, counterfeiting, extortion, checks, credit cards, or computer violations specified in Section 502 of the Penal Code. (2) For the purpose of this subdivision, an offense does not include a conviction for which the person has obtained a certificate of rehabilitation from a court of competent jurisdiction under Section 1203.4 or 4852.13 of the Penal Code or a similar certificate of rehabilitation obtained in a foreign jurisdiction. (c) On and after January 1, 1992, any person who seeks employment by, or an ownership interest in, or other participation in the business of a licensed escrow agent shall, as a condition to obtaining that employment, interest, or participation, authorize Fidelity Corporation and the commissioner, or both, to have access to that person’s state and federal summary criminal history information, as defined in Section 11105 of the Penal Code, for purposes of determining whether the person has a prior conviction of, or pleaded nolo contendere to, a criminal offense specified in subdivision (b). (d) On or before the 10th day of employment, each escrow agent shall obtain and forward to the commissioner the fingerprint images and related information of persons seeking employment by an escrow agent. The fingerprint images and related information may be submitted by certified mail, return receipt requested, or transmitted electronically, using the process established by the Department of Justice for requesting state and federal summary criminal history information. Persons who have previously submitted fingerprints or fingerprint images and related information to the commissioner may so notify the commissioner and need not submit additional fingerprint images and related information unless requested to do so by the commissioner. The commissioner shall provide written notice to both the escrow agent and to the person if any of the information received pursuant to this division shows that the person’s employment would be in violation of Section 17414.1, and the escrow agent shall deny the person the employment. A person whose employment is in violation of subdivision (a) shall not have access to trust funds or sign checks or otherwise perform any activities related to the processing of escrow transactions after the licensed escrow agent has been notified by the commissioner that the person’s employment is in violation of subdivision (a). (e) Any state and federal summary criminal history information obtained pursuant to this section shall be kept confidential and a recipient shall not disclose the contents other than for the purpose of determining eligibility for employment by, acquisition of an ownership interest in, or other participation in, the business of a licensed escrow agent. (f) The authority granted by this section to the commissioner or to Fidelity Corporation shall be in addition to any other authority granted by law to obtain information about any person who is subject to this division. This section shall not be construed to limit any authority of the commissioner or Fidelity Corporation otherwise provided by law. (g) Any person who knowingly violates subdivision (a) or (d), including, but not limited to, any escrow agent who permits employment by, an ownership interest in, or other participation in, the business of an escrow agent in violation of subdivision (a) or (d) shall, upon conviction, be subject to punishment pursuant to Section 17700. Any person who knows of a violation of subdivision (a) or (d) shall immediately report the violation in writing to the commissioner. A person shall not be civilly liable for reporting as required under this subdivision unless the information provided in the report is false, and the person providing false information does so with knowledge and malice. The reports filed under this section, including the identity of the person making the filing, shall remain confidential pursuant to state law. (h) This section shall not be construed to permit the reinstatement of any person barred by the commissioner pursuant to Section 17423 nor to prohibit the commissioner from bringing any action pursuant to Section 17423. (i) If any provision of this section or the application thereof to any person or circumstances is held invalid, that invalidity shall not affect other provisions or applications of this section which can be given effect without the invalid provision or application, and to this end the provisions of this section are severable. (Amended by Stats. 2022, Ch. 846, Sec. 1. (SB 1348) Effective January 1, 2023.)
  179. 17414.2.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    An escrow agent or Fidelity Corporation may give a written employment reference after a written request, and must send a copy to the person’s last known address if the subdivision (b) immunity is to apply.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17414.2. (a) In response to any written request by an escrow agent or by Fidelity Corporation, any bank, savings association, credit union, any other financial institution, or any other exempt person specified in Section 17006, an escrow agent or Fidelity Corporation may provide a written employment reference that advises of the person’s involvement in a crime or act specified in Section 17414 or subdivision (b) of Section 17414.1, or any theft, embezzlement, misappropriation, or other defalcation which has been reported to federal authorities pursuant to federal banking guidelines, or that has been reported to the commissioner or Fidelity Corporation, pursuant to this division. In order for the immunity provided in subdivision (b) to apply, a copy of the written employment reference shall be sent concurrently by the Fidelity Corporation, person, entity, escrow agent, bank, savings association, credit union, any other financial institution, or exempt person specified in Section 17006 providing the reference, to the last known address of the person concerning whom the reference is provided. (b) No licensed escrow agent, bank, savings association, credit union, any other financial institution, exempt person specified in Section 17006, or Fidelity Corporation shall be civilly liable for providing an employment reference as specified in subdivision (a), unless the information provided is false and the licensed escrow agent, bank, savings association, credit union, any other financial institution, or exempt person specified in Section 17006, or Fidelity Corporation providing false information does so with knowledge and malice. (Added by Stats. 1991, Ch. 1221, Sec. 5.)
  180. 17415.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    The commissioner may order an escrow operator to stop certain business activities if specified unsafe or noncompliant conditions are found.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17415. (a) If the commissioner, as a result of any examination or from any report made to the commissioner, shall find that any person subject to this division is in an insolvent condition, is conducting or has conducted escrow business in such an unsafe or injurious manner as to render further operations hazardous to the public or to customers, is failing or has failed to comply with the provisions of Section 17212.1 or 17414.1, is permitting or has permitted its tangible net worth to be lower than the minimum required by law, is failing or has failed to maintain its liquid assets in excess of current liabilities as set forth in Section 17210, or is failing or has failed to comply with the bonding requirements of Chapter 2 (commencing with Section 17200) of this division, the commissioner may, by an order addressed to and served by registered or certified mail or by personal service on such person and on any other person having in their possession or control any escrowed funds, trust funds, or other property deposited in escrow with said person, direct discontinuance of the disbursement of trust funds by the parties or any of them, the receipt of trust funds, the delivery or recording of documents received in escrow, or other business operations. No person having in their possession any of these funds or documents shall be liable for failure to comply with the order unless they received written notice of the order. Subject to subdivision (b), the order shall remain in effect until set aside by the commissioner in whole or in part, the person is the subject of an order for relief in bankruptcy, or pursuant to Chapter 6 (commencing with Section 17621) of this division the commissioner has assumed possession of the escrow agent. (b) Within 15 days from the date of an order pursuant to subdivision (a), the person may request a hearing under the Administrative Procedure Act, Chapter 5 (commencing with Section 11500) of Division 3 of Title 2 of the Government Code. Upon receipt of a request, the matter shall be set for hearing to commence within 30 days after such receipt unless the person subject to this division consents to a later date. If no hearing is requested within 15 days after the mailing or service of such notice and none is ordered by the commissioner, the failure to request a hearing shall constitute a waiver of the right to a hearing. Neither the request for a hearing nor the hearing itself shall stay the order issued by the commissioner under subdivision (a). (Amended by Stats. 2022, Ch. 188, Sec. 9. (AB 2433) Effective January 1, 2023.)
  181. 17416.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    The commissioner may order an unlicensed person who is operating, even through subterfuge, in the escrow business to stop and refrain from continuing.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17416. Whenever in the opinion of the commissioner any person, except as named in Section 17006, is engaged, either actually or through subterfuge, in the business of receiving escrows for deposit or delivery as defined in this division, without a license from the commissioner the commissioner may order that person to desist and to refrain from engaging in that business. If, within 30 days after such an order is served, a request for a hearing is filed in writing and the hearing is not held within 60 days thereafter, the order is rescinded. (Amended by Stats. 1987, Ch. 564, Sec. 4.)
  182. 17419.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    People seeking work with an escrow agent must complete an employment application by the first day of work, unless they are covered by the listed exemption. Anyone who knows or should have known of a violation must report it in writing to the commissioner immediately.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17419. On and after January 1, 1992, any person seeking employment with an escrow agent shall complete an employment application on or before the first day of employment which includes, at least, the following information. A copy of the employment application shall be forwarded to the commissioner on or before the first day of the applicant’s employment. Persons required to file a statement of identity and questionnaire pursuant to subdivision (g) of Section 17209 or Section 17212.1 are not required to file the employment application set forth in this section. Each person completing the employment application shall be given the notice required by the Information Practices Act (Section 1798.17 of the Civil Code), copies of which may be obtained from the commissioner. Nothing in this section shall limit an escrow agent from requesting additional information from an applicant. STATEMENT OF IDENTITY AND EMPLOYMENT APPLICATION Name of Escrow Company: Escrow Agent License Number: 1. Exact Full Name: (Please Print or Type)First NameMiddle NameLast Name (Do not use initials or nicknames) Title of position to be filled in connection with the preparation of this employment application. 2. Employment for the last 10 years: From To Employer Name and Address Occupation and Duties _____ Present _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ NOTE: Attach separate schedule if space is not adequate. 3. Residence addresses for the last 10 years: From To Street City State _____ Present _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ NOTE: Attach separate schedule if space is not adequate. 4. Have you ever been named in any order, judgment or decree of any court or any governmental agency or administrator, temporarily or permanently restraining or enjoining you from engaging in or continuing any conduct, practice or employment? ( ) Yes ( ) No If the answer is “Yes,” please complete the following: _____ Date of Suit: Location of Court (City, County, State): Nature of Suit: Note: Attach a certified copy of any order, judgment, or decree. 5. Have you ever been refused a license to engage in any business in this state or any other state, or has any such license ever been suspended or revoked? ( ) Yes ( ) No If the answer is “Yes,” please complete the following: _____ State: Title of State Department: Nature of License and Number: Note: Attach a certified copy of any order, judgment, or decree. 6. Have you ever been convicted of or pleaded nolo contendere to a crime other than minor traffic citations that do not constitute a misdemeanor or felony offense? NOTE: A conviction is a plea or verdict of guilty or a conviction following a plea of nolo contendere. A conviction also includes an order granting probation and suspending the imposition of sentence, notwithstanding a subsequent order pursuant to Sections 1203.4 or 1203.4a of the Penal Code permitting the person to withdraw his or her plea of guilty, or dismissing the accusation, information, or indictment. _____ ( ) Yes ( ) No If the answer is “Yes,” please complete the following: _____ Date of Case: Location of Court (City, County, State): Nature of Case: Note: Attach a certified copy of any order, judgment, or decree. 7. Have you ever been a defendant in a civil court action other than divorce, condemnation or personal injury? _____ ( ) Yes ( ) No If the answer is “Yes,” please complete the following: _____ Date of Suit: Location of Court (City, County, State): Nature of Suit: Note: Attach a certified copy of any order, judgment, or decree. 8. Have you ever changed your name or ever been known by any name other than that herein listed? (Including a woman’s maiden name) _____ ( ) Yes ( ) No If so, explain. Change in name through marriage or court order should also be listed. EXACT DATE OF EACH NAME CHANGE MUST BE LISTED. 9. Have you ever done business under a fictitious firm name either as an individual or in the partnership or corporate form? ( ) Yes ( ) No If the answer is “Yes,” set forth particulars: 10. Have you ever been a subject of a bankruptcy or a petition in bankruptcy? ( ) Yes ( ) No If the answer is “Yes,” give date, title of case, location of bankruptcy filing: 11. Have you ever been refused a bond, or have you ever had a bond revoked or canceled? ( ) Yes ( ) No If the answer is “Yes,” give details: 12. In what capacity will you be employed? (e.g., Clerk, Escrow Officer, Receptionist, etc.) _____ _____ 13. Do you expect to be a party to, or broker or salesperson in connection with, escrows conducted by the escrow company which is employing you? ( ) Yes ( ) No If the answer is “Yes,” please explain: _____ NOTE: Attach separate schedule if space is not adequate. VERIFICATION I, the undersigned, state that I am the person named in the foregoing Statement of Identity and Employment Application; that I have read and signed the Statement of Identity and Employment Application and know the contents thereof, including all exhibits attached thereto, and that the statements made therein, including any exhibits attached thereto, are true. Any person who knows or should have known of a violation of this section shall immediately report the violation in writing to the commissioner. _____ I certify/declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct. _____ Executed at _____ (City) _____ _____ (County)(State) _____ thisday of, 20__. _____ _____ (Signature of Declarant) (Amended by Stats. 2007, Ch. 130, Sec. 94. Effective January 1, 2008.)
  183. 17420.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    People covered by this division must not pay commissions or similar compensation for referring, soliciting, handling, or servicing escrow customers or accounts, except normal compensation of their own employees.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17420. Except for the normal compensation of his own employees, it shall be a violation of this division for any person subject to this division to pay over to any other person any commission, fee, or other consideration as compensation for referring, soliciting, handling, or servicing escrow customers or accounts. It shall also be a violation for any person to enter into any arrangement, either of his own making or of a subsidiary nature, or through any other person having a dual capacity, or through any person having a direct or indirect interest in the escrow, or other device permitting any fee, commission, or compensation which is contingent upon the performance of any act, condition, or instruction set forth in an escrow to be drawn or paid, either in whole or in part, or in kind or its equivalent, prior to the actual closing and completion of the escrow. (Amended by Stats. 1961, Ch. 475.)
  184. 17421.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    A disbursal may be paid out before escrow closes if all parties give written instructions, but not if it is for a fee, commission, or compensation.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17421. Notwithstanding the provisions of Section 17420, a disbursal, other than for a fee, commission or compensation may be advanced or paid out prior to the close of an escrow if the written instructions of all parties to the transaction so provide. (Added by Stats. 1963, Ch. 996.)
  185. 17421.5.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    A licensee may charge a fee for administering certain postponed or canceled escrows if the fee was properly disclosed and initialed in the written instructions.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17421.5. (a) Notwithstanding Section 17420, a licensee may charge a fee for administering an escrow that has been postponed for at least two months from the most recent closing date agreed upon by the parties in the written instructions or has been canceled if all of the following requirements are met: (1) The postponement or cancellation resulted from the acts or omissions of the parties to the escrow transaction. (2) The fee was disclosed in the written instructions in not less than 8-point bold type on the face or front page of the instructions. (3) The principal parties to the escrow transaction have executed the written fee instructions by initialing those instructions. (b) This section shall apply to written instructions made on and after January 1, 2008. (Added by Stats. 2007, Ch. 237, Sec. 4. Effective January 1, 2008.)
  186. 17422.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    A joint control agent must not pay construction-related expenses unless acting under written instructions from the principals and until the payee has substantially complied with the control agreement specifications.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17422. A joint control agent, unless acting pursuant to written instructions of his principals, shall not disburse funds for the payment of the cost of labor, materials, services, permits, fees, or other items of expense incurred in the construction of improvements upon real property until such time as he determines that the person furnishing such labor, materials, services, permits, fees, or other items has substantially complied with the specifications contained in the control agreement. (Added by Stats. 1965, Ch. 1205.)
  187. 17423.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    The commissioner may censure, suspend, or bar escrow agents or other persons, and certain persons are immediately prohibited from escrow processing while a proposed order is pending.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17423. (a) The commissioner may, after appropriate notice and opportunity for hearing, by order, censure or suspend for a period not exceeding 12 months, or bar from any position of employment, management, or control any escrow agent, or any other person, if the commissioner finds either of the following: (1) That the censure, suspension, or bar is in the public interest and that the person has committed or caused a violation of this division or rule or order of the commissioner, which violation was either known or should have been known by the person committing or causing it or has caused material damage to the escrow agent or to the public. (2) That the person has been convicted of or pleaded nolo contendere to any crime, or has been held liable in any civil action by final judgment, or any administrative judgment by any public agency, if that crime or civil or administrative judgment involved any offense specified in subdivision (b) of Section 17414.1, or any other offense reasonably related to the qualifications, functions, or duties of a person engaged in the business in accordance with the provisions of this division. (b) Within 15 days from the date of a notice of intention to issue an order pursuant to subdivision (a), the person may request a hearing under the Administrative Procedure Act (Chapter 5 (commencing with Section 11500) of Division 3 of Title 2 of the Government Code). Upon receipt of a request, the matter shall be set for hearing to commence within 30 days after such receipt unless the person subject to this division consents to a later date. If no hearing is requested within 15 days after the mailing or service of such notice and none is ordered by the commissioner, the failure to request a hearing shall constitute a waiver of the right to a hearing. (c) Upon receipt of a notice of intention to issue an order pursuant to this section, the person who is the subject of the proposed order is immediately prohibited from engaging in any escrow processing activities, including disbursing any trust funds in the escrow agent’s possession, custody or control, and the financial institution holding trust funds shall be so notified by service of the notice, accusation and other administrative pleadings. The prohibition against disbursement of trust funds may be set aside, in whole or in part, by the commissioner for good cause. (d) Fidelity Corporation shall disclose to all licensees the identity of persons who have been censured, suspended, or barred from any position of employment, management, or control. (e) Persons suspended or barred under this section are prohibited from participating in any business activity of a licensed escrow agent and from engaging in any business activity on the premises where a licensed escrow agent is conducting escrow business. This subdivision shall not be construed to prohibit suspended or barred persons from having their personal escrow transactions processed by a licensed escrow agent. (f) This section shall apply to any violation, conviction, plea, or judgment occurring at any time prior to and after the enactment of this section. (g) The provisions of Section 17414.1 exempting convictions for which a person has obtained a certificate of rehabilitation from the prohibition against serving as an officer, director, stockholder, trustee, agent, or employee of an escrow agent, or in any position involving any duties with an escrow agent, shall not apply to permit the reinstatement of any person barred by the commissioner pursuant to this section, nor to prohibit the commissioner from bringing any action pursuant to this section. (h) If any provision of this section or the application thereof to any person or circumstances is held invalid, that invalidity shall not affect other provisions or applications of this section which can be given effect without the invalid provision or application, and to this end the provisions of this section are severable. (Amended by Stats. 1993, Ch. 625, Sec. 4. Effective January 1, 1994.)
  188. 17423.1.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    The commissioner must notify the Real Estate Commissioner and the Insurance Commissioner when certain enforcement or disciplinary actions become final, share specified documents and related factual material on request, and maintain a public database of covered persons.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17423.1. (a) (1) Whenever the commissioner takes any enforcement or disciplinary action pursuant to Section 17423, upon the action becoming final the commissioner shall notify the Real Estate Commissioner and the Insurance Commissioner of the action or actions taken. The purpose of this notification is to alert the departments that enforcement or disciplinary action has been taken, if the person seeks or obtains employment with entities regulated by the departments. (2) The commissioner shall provide the Real Estate Commissioner and the Insurance Commissioner, in addition to the notification of the action taken, with a copy of the written accusation, statement of issues, or order issued or filed in the matter and, at the request of the Real Estate Commissioner or Insurance Commissioner, with any underlying factual material relevant to the enforcement or disciplinary action. Any confidential information provided by the commissioner to the Insurance Commissioner or the Real Estate Commissioner shall not be made public pursuant to this section. Notwithstanding any other provision of law, the disclosure of any underlying factual material to the Insurance Commissioner or the Real Estate Commissioner shall not operate as a waiver of confidentiality or any privilege that the commissioner may assert. (b) The commissioner shall establish and maintain, on the internet website maintained by the Department of Financial Protection and Innovation, a separate and readily identifiable database of all persons who have been subject to any enforcement or disciplinary action that triggers the notification requirements of this section. The database shall also contain a direct link to the databases, described in Section 10176.1 of the Business and Professions Code and Section 12414.31 of the Insurance Code and required to be maintained on the Web sites of the Bureau of Real Estate and the Department of Insurance, respectively, of persons who have been subject to enforcement or disciplinary action for malfeasance or misconduct related to the escrow industry by the Insurance Commissioner and the Real Estate Commissioner. (c) There shall be no liability on the part of, and no cause of action of any nature shall arise against, the State of California, the Department of Financial Protection and Innovation, the Commissioner of Financial Protection and Innovation, any other state agency, or any officer, agent, employee, consultant, or contractor of the state, for the release of any false or unauthorized information pursuant to this section, unless the release of that information was done with knowledge and malice, or for the failure to release any information pursuant to this section. (Amended by Stats. 2022, Ch. 452, Sec. 126. (SB 1498) Effective January 1, 2023.)
  189. 17424.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    The commissioner may discipline a licensee based on certain related disciplinary actions taken elsewhere.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17424. (a) For any licensee, a disciplinary action taken by the State of California, another state, an agency of the federal government, or another country for an action substantially related to the activity regulated under this division may be grounds for disciplinary action by the commissioner. A certified copy of the record of the disciplinary action taken against the licensee by the State of California, other state, agency of the federal government, or other country shall be conclusive evidence of the events related therein. (b) Nothing in this section shall preclude the commissioner from applying a specific statutory provision in this division providing for discipline against a licensee as a result of disciplinary action taken against a licensee by the State of California, another state, an agency of the federal government, or another country. (Added by Stats. 2003, Ch. 473, Sec. 19. Effective January 1, 2004.)
  190. 17425.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    People covered by this division, and their directors, stockholders, trustees, officers, agents, and employees, violate this division if they violate RESPA or its regulations.

    ## Financial Code - FIN ## DIVISION 6. ESCROW AGENTS [17000 - 17703] ( Division 6 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Escrow Regulations [17400 - 17425] ( Chapter 3 enacted by Stats. 1951, Ch. 364. ) ## 17425. Any person subject to this division or any director, stockholder, trustee, officer, agent, or employee of that person who violates any provision of the federal Real Estate Settlement Procedures Act, as amended (12 U.S.C. Sec. 2601 et seq.), or any regulation promulgated thereunder, violates this division. (Added by Stats. 2007, Ch. 237, Sec. 5. Effective January 1, 2008.)
  191. 175.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 1. Definitions [99 - 217] ( Chapter 1 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    This section defines “foreign nation.”

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 1. Definitions [99 - 217] ( Chapter 1 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 175. “Foreign nation” means any nation other than the United States, including, without limitation, any subdivision, territory, trust territory, dependency, colony, or possession of any nation other than the United States. “Foreign nation” includes Puerto Rico, Guam, American Samoa, the Virgin Islands, and any territory, trust territory, dependency, or insular possession of the United States. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  192. 1750.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 20. Foreign (Other Nation) Banks [1750 - 1835] ( Chapter 20 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1750 - 1768] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    This section defines terms used in the chapter about foreign banks.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 20. Foreign (Other Nation) Banks [1750 - 1835] ( Chapter 20 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1750 - 1768] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1750. In this chapter, unless the context otherwise requires: (a) “Agency” means a depositary agency or a nondepositary agency. (b) “Branch office” means a limited branch office, a retail branch office, or a wholesale branch office. (c) “Business in this state,” when used with respect to a foreign (other nation) bank which is licensed to maintain one or more agencies or branch offices, includes (without limitation) the aggregate business of all the offices. (d) “Controlling person,” when used with respect to a foreign (other nation) bank, means any person who, directly or indirectly, controls the bank. For purposes of this subdivision, “control” has the meaning set forth in subdivision (b) of Section 1250, and “person” has the meaning set forth in subdivision (d) of Section 1250. (e) “Depositary agency,” when used with respect to a foreign (other nation) bank, means a place in this state at which the bank transacts commercial banking business but at which it does not transact the business of receiving deposits, except as permitted under paragraph (2) of subdivision (a) of Section 1805. (f) “Executive officer,” when used with respect to a foreign (other nation) bank or a controlling person of a foreign (other nation) bank, means the chief executive officer, the chief operating officer, the chief financial officer, and any other person who participates or has authority to participate in major policymaking functions of the bank or controlling person. “Executive officer,” when used with respect to a foreign (other nation) bank, includes the head of the international division (or, if there is no such division, the closest equivalent division or unit) of such bank. (g) “Federal agency” has the meaning set forth in Section 1(b) of the International Banking Act of 1978. (h) “Federal branch” has the meaning set forth in Section 1(b) of the International Banking Act of 1978. (i) (1) “License” means a license issued under this chapter, authorizing a foreign bank to maintain an office. (2) To be “licensed” means to be issued or to hold a license. (3) To be “licensed to transact business in this state,” when used with respect to a foreign (other nation) bank, means that the bank is licensed to maintain an agency or branch office. (j) “Limited branch office,” when used with respect to a foreign (other nation) bank, means a place in this state at which the bank transacts commercial banking business but at which it does not transact the business of receiving deposits except as permitted under paragraph (3) of subdivision (a) of Section 1805. (k) “Nondepositary agency,” when used with respect to a foreign (other nation) bank, means a place in this state at which the bank transacts commercial banking business, except the business of receiving deposits. (l) “Office,” when used with respect to a foreign (other nation) bank, means any agency, branch office, or representative office of the bank. (m) “Primary office,” when used with respect to a foreign (other nation) bank that is licensed to maintain a single agency or branch office, means the agency or branch office and, when used with respect to a foreign (other nation) bank that is licensed to maintain two or more agencies or branch offices, means that one of the offices which the bank has designated as its primary office in accordance with Section 1766. (n) “Representative office,” when used with respect to a foreign (other nation) bank, means an office in this state at which the bank engages in representational functions but at which it does not transact commercial banking business. (o) “Retail branch office,” when used with respect to a foreign (other nation) bank, means a place in this state at which the bank transacts commercial banking business, including (without limitation) the business of receiving deposits. (p) “Wholesale branch office,” when used with respect to a foreign (other nation) bank, means a place in this state at which the bank transacts commercial banking business but at which it does not transact the business of receiving deposits except as permitted under paragraph (4) of subdivision (a) of Section 1805. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  193. 1751.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 20. Foreign (Other Nation) Banks [1750 - 1835] ( Chapter 20 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1750 - 1768] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    This chapter does not apply to a federal agency or branch in this state, except Section 1760.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 20. Foreign (Other Nation) Banks [1750 - 1835] ( Chapter 20 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1750 - 1768] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1751. Nothing in this chapter, except Section 1760, applies to a federal agency or branch in this state. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  194. 1752.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 20. Foreign (Other Nation) Banks [1750 - 1835] ( Chapter 20 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1750 - 1768] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    A subject bank is defined, and it may not simultaneously keep both a licensed foreign (other nation) office in California and a California branch office as a foreign (other state) state bank.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 20. Foreign (Other Nation) Banks [1750 - 1835] ( Chapter 20 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1750 - 1768] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1752. (a) In this section, “subject bank” means a bank organized under the laws of any territory of the United States, Puerto Rico, Guam, American Samoa, the Trust Territory of the Pacific Islands, the Virgin Islands, or the Northern Mariana Islands. (b) Nothing in this chapter, except subdivision (c), shall apply to a subject bank that maintains a branch office in this state as a foreign (other state) state bank pursuant to Chapter 19 (commencing with Section 1670), Section 13(f), 13(k), 18(d), or 44 of the Federal Deposit Insurance Act (12 U.S.C. Sec. 1823(f), 1823(k), 1828(d), or 1831u), or Section 9 of the Federal Reserve Act (12 U.S.C. Sec. 321). (c) No subject bank shall at the same time maintain (1) as a foreign (other nation) bank, an office in this state licensed under this chapter and (2) as a foreign (other state) state bank, a branch office in this state pursuant to Chapter 19 (commencing with Section 1670), Section 13(f), 13(k), 18(d), or 44 of the Federal Deposit Insurance Act (12 U.S.C. Sec. 1823(f), 1823(k), 1828(d), or 1831u), or Section 9 of the Federal Reserve Act (12 U.S.C. Sec. 321). (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  195. 1753.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 20. Foreign (Other Nation) Banks [1750 - 1835] ( Chapter 20 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1750 - 1768] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    Offices of foreign banks must be classified into ranked categories from representative office up to retail branch office.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 20. Foreign (Other Nation) Banks [1750 - 1835] ( Chapter 20 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1750 - 1768] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1753. For purposes of this chapter, offices of foreign (other nation) banks are divided into classes and ranked in ascending order, as follows: (a) Representative office. (b) Nondepositary agency. (c) Depositary agency. (d) Limited branch office. (e) Wholesale branch office. (f) Retail branch office. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  196. 1754.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 20. Foreign (Other Nation) Banks [1750 - 1835] ( Chapter 20 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1750 - 1768] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    This section defines how office conversions are treated and allows a foreign bank to change a higher class office into a lower class office if approval to close the higher office has been granted and all closing conditions are met.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 20. Foreign (Other Nation) Banks [1750 - 1835] ( Chapter 20 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1750 - 1768] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1754. (a) For purposes of this chapter: (1) Changing a lower class office into a higher class office shall be treated as establishing the higher class office, but not as closing the lower class office. (2) Changing a higher class office into a lower class office shall be treated as closing the higher class office, but not as establishing the lower class office. (b) In the case of changing a higher class office into a lower class office, when the application for approval to close the higher class office has been approved and all conditions precedent to the closing have been fulfilled, the foreign (other nation) bank may change the higher class office into the lower class office, and the commissioner shall issue a license authorizing the bank to maintain the lower class office. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  197. 1755.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 20. Foreign (Other Nation) Banks [1750 - 1835] ( Chapter 20 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1750 - 1768] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    Foreign banks must pay specified application, license, and annual representative-office fees to the commissioner.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 20. Foreign (Other Nation) Banks [1750 - 1835] ( Chapter 20 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1750 - 1768] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1755. Fees shall be paid to, and collected by, the commissioner, as follows: (a) The fee for filing with the commissioner an application by a foreign (other nation) bank that is not licensed to transact business in this state for approval to establish a branch office shall be two thousand dollars ($2,000). (b) The fee for filing with the commissioner an application by a foreign (other nation) bank that is not licensed to transact business in this state for approval to establish an agency shall be one thousand five hundred dollars ($1,500). (c) The fee for filing with the commissioner an application by a foreign (other nation) bank that is licensed to transact business in this state for approval to establish a branch office shall be one thousand dollars ($1,000). (d) The fee for filing with the commissioner an application by a foreign (other nation) bank that is licensed to transact business in this state for approval to establish an agency shall be seven hundred fifty dollars ($750). (e) The fee for filing with the commissioner an application by a foreign (other nation) bank for approval to establish a representative office shall be two hundred fifty dollars ($250). (f) The fee for filing with the commissioner an application by a foreign (other nation) bank that is licensed to maintain an agency or branch office for approval to relocate or to close the office shall be two hundred fifty dollars ($250). (g) The fee for filing with the commissioner an application by a foreign (other nation) bank that is licensed to maintain a representative office for approval to relocate or to close the representative office shall be one hundred dollars ($100). (h) The fee for issuing a license shall be twenty-five dollars ($25). (i) Each foreign (other nation) bank that on June 1st of any year is licensed to maintain a representative office but is not licensed to transact business in this state shall pay, on or before the following July 1st, a fee of two hundred fifty dollars ($250) for each such representative office. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  198. 1756.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 20. Foreign (Other Nation) Banks [1750 - 1835] ( Chapter 20 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1750 - 1768] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    Applications filed with the commissioner under this chapter must follow the form, content, and signature requirements the commissioner sets; verification is required only if the commissioner requires it by regulation or order.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 20. Foreign (Other Nation) Banks [1750 - 1835] ( Chapter 20 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1750 - 1768] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1756. Each application filed with the commissioner under this chapter or under any regulation or order issued under this chapter shall be in such form, shall contain such information, shall be signed in such manner, and shall (if the commissioner so requires by regulation or order) be verified in such manner, as the commissioner may by regulation or order require. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  199. 1757.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 20. Foreign (Other Nation) Banks [1750 - 1835] ( Chapter 20 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1750 - 1768] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    The commissioner may presume good character and sound financial standing for certain bank-related persons, and may also find them not of good character based on listed misconduct and other grounds.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 20. Foreign (Other Nation) Banks [1750 - 1835] ( Chapter 20 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1750 - 1768] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1757. (a) In this section, “act” includes (without limitation) omission. (b) For purposes of making findings on an application by a foreign (other nation) bank for approval to establish an office: (1) The commissioner may, in the absence of credible evidence to the contrary, presume that the directors, executive officers, and any controlling person of the bank and the directors and executive officers of any controlling person of the bank are each of good character and sound financial standing. (2) The commissioner may find that the bank, a director, executive officer, or a controlling person of the bank, or a director or executive officer of a controlling person of the bank is not of good character if that person has done any of the following: (A) Has been convicted of, or has pleaded nolo contendere to, any crime involving an act of fraud or dishonesty. (B) Has consented to or suffered a judgment in any civil action based upon conduct involving an act of fraud or dishonesty. (C) Has consented to or suffered the suspension or revocation of any professional, occupational, or vocational license based upon conduct involving an act of fraud or dishonesty. (D) Has willfully made or caused to be made in any application or report filed with the commissioner or in any proceeding before the commissioner, any statement that was at the time and in the light of the circumstances under which it was made false or misleading with respect to any material fact, or has willfully omitted to state in any application or report filed with the commissioner or in any proceeding before the commissioner, any material fact that was required to be stated therein. (E) Has willfully committed any violation of, or has willfully aided, abetted, counseled, commanded, induced, or procured the violation by any other person of, any provision of this division or of any regulation or order issued under this division. (c) Paragraph (2) of subdivision (b) shall not be deemed to be an exclusive list of the grounds upon which the commissioner may find, for purposes of making findings on an application by a foreign (other nation) bank for approval to establish an office, that the bank, a director, executive officer, or controlling person of the bank, or a director or executive officer of a controlling person of the bank is not of good character. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  200. 1758.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 20. Foreign (Other Nation) Banks [1750 - 1835] ( Chapter 20 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1750 - 1768] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    Foreign banks licensed to maintain an office must file reports with the commissioner when required, and the commissioner can set the required form, contents, signature, and verification method.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 20. Foreign (Other Nation) Banks [1750 - 1835] ( Chapter 20 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. General Provisions [1750 - 1768] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1758. (a) Each foreign (other nation) bank that is licensed to maintain an office shall file with the commissioner reports as and when the commissioner may, by regulation or order, require. (b) Each report filed with the commissioner under this chapter or under any regulation or order issued under this chapter shall be in the form, shall contain the information, shall be signed in the manner, and shall (if the commissioner so requires by regulation or order) be verified in the manner, that the commissioner may, by regulation or order, require. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)

Provision text is displayed from LexChat’s stored statute record. Use the official source links to verify amendments, commencement, and current legal force.

LexChat organizes source-backed legal information for research. Verify amendments, commencement, and current legal force with the official publisher before relying on it.