Financial Code — Part 7 | FIN — United States — California law | Esheria

Financial Code

Part 7 of 17 · provisions 1,201–1,400

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

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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.

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Provisions of Financial Code

Showing 200 of 3,273

  1. 18218.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. Terms and Maximum Charges [18205 - 18222] ( Article 2 added by Stats. 1976, Ch. 964. )

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    An industrial loan company may collect certain court-approved costs and specified actual expenses when collecting a delinquent loan with an unpaid principal balance.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. Terms and Maximum Charges [18205 - 18222] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18218. Notwithstanding any other provision of this division, an industrial loan company, in the collection of a delinquent loan of an unpaid principal balance, may do any of the following: (a) Collect and receive the court costs and reasonable attorney’s fees allowed by a court in a judgment against a defaulting debtor. (b) Contract for, collect, and receive the bona fide expenses actually incurred and paid by the industrial loan company, not exceeding 10 percent of the unpaid principal balance of the loan where no judgment at law is sought. (c) Contract for, collect, and receive the bona fide expenses actually incurred and paid by the industrial loan company in obtaining a certificate of compliance or certificate of noncompliance issued for a motor vehicle pursuant to Part 5 (commencing with Section 43000) of Division 26 of the Health and Safety Code and the rules and regulations of the State Air Resources Board prior to the consignment of the vehicle for sale at public auction, pursuant to Sections 24007 and 24007.5 of the Vehicle Code. (Amended by Stats. 1991, Ch. 1054, Sec. 1.3.)
  2. 18218.5.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. Terms and Maximum Charges [18205 - 18222] ( Article 2 added by Stats. 1976, Ch. 964. )

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    A licensee may charge and collect up to $15 for the return of a dishonored check, negotiable order of withdrawal, or share draft on a loan under this division.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. Terms and Maximum Charges [18205 - 18222] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18218.5. With respect to a loan under this division, a fee not to exceed fifteen dollars ($15) for return by a depository institution of a dishonored check, negotiable order of withdrawal, or share draft may be charged and collected by the licensee. The fee is not included in charges as defined in this division or in determining the applicable maximum charges which may be made under this article. (Amended by Stats. 1993, Ch. 101, Sec. 4. Effective January 1, 1994.)
  3. 18219.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. Terms and Maximum Charges [18205 - 18222] ( Article 2 added by Stats. 1976, Ch. 964. )

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    An industrial loan company must not help a borrower split or divide a loan to get a higher charge than this division allows.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. Terms and Maximum Charges [18205 - 18222] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18219. An industrial loan company shall not induce or permit any borrower to split up or divide any loan and thereby contract for or receive a higher rate of charge than would otherwise be permitted by this division. (Added by Stats. 1976, Ch. 964.)
  4. 18220.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. Terms and Maximum Charges [18205 - 18222] ( Article 2 added by Stats. 1976, Ch. 964. )

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    An industrial loan company must not induce spouses to take on more than one loan contract at the same time if that would lead to a higher charge than otherwise allowed.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. Terms and Maximum Charges [18205 - 18222] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18220. An industrial loan company shall not induce any spouses, jointly or severally, to become obligated, directly or contingently or both, under more than one contract of loan at the same time, with the result of obtaining a higher rate of charge than would otherwise be permitted by this division. (Amended by Stats. 2016, Ch. 50, Sec. 38. (SB 1005) Effective January 1, 2017.)
  5. 18221.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. Terms and Maximum Charges [18205 - 18222] ( Article 2 added by Stats. 1976, Ch. 964. )

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    An industrial loan company may make loan contracts with different borrowers and charge up to the highest rate allowed when the loans are made, but charges on multiple outstanding loans cannot exceed the maximum that would apply if the loans were combined into one transaction.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. Terms and Maximum Charges [18205 - 18222] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18221. Nothing in this division shall prevent an industrial loan company from transacting loan contracts with different borrowers and from contracting for and receiving, up to and including the highest rate of charge permitted by this division at the time of making said loans; provided, however, that if any person is obligated to and does pay more than one loan contract outstanding at the same time, the entire amount of charges paid by such person and received by the industrial loan company on such loan contracts, shall not exceed the maximum that would be permitted by this division if all such loan contracts so paid were combined into one loan transaction. (Added by Stats. 1976, Ch. 964.)
  6. 18222.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. Terms and Maximum Charges [18205 - 18222] ( Article 2 added by Stats. 1976, Ch. 964. )

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    An industrial loan company must allow advance payments on a loan contract, in any amount and at any time, and must apply the payment first to charges due and then to the remaining loan balance.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. Terms and Maximum Charges [18205 - 18222] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18222. An industrial loan company shall permit payment to be made in advance in any amount on any contract of loan at any time. The industrial loan company shall apply such payment first to all charges due up to the date of such payment and the remainder to the loan balance. (Added by Stats. 1976, Ch. 964.)
  7. 18230.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Disclosure and Loan Documents [18230 - 18235] ( Article 3 added by Stats. 1976, Ch. 964. )

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    Each industrial loan company must prominently display a full and accurate schedule of maximum charges and how those charges are computed at each place of business.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Disclosure and Loan Documents [18230 - 18235] ( Article 3 added by Stats. 1976, Ch. 964. ) ## 18230. Each industrial loan company shall display prominently in each place of business a full and accurate schedule of the maximum charges to be made and the method of computing the same. The schedule is subject to the approval of the commissioner. (Added by Stats. 1976, Ch. 964.)
  8. 18231.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Disclosure and Loan Documents [18230 - 18235] ( Article 3 added by Stats. 1976, Ch. 964. )

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    Industrial loan companies must give borrowers a written loan statement at funding, get a signed broker-disclosure statement from the borrower, and keep the required statements for two years after payoff, maturity, or charge-off.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Disclosure and Loan Documents [18230 - 18235] ( Article 3 added by Stats. 1976, Ch. 964. ) ## 18231. Each industrial loan company shall: (a) Deliver or cause to be delivered to the borrowers, or any one thereof, at the time the loan is made, a written statement showing in clear and distinct terms the name and address of such company and the broker, if any. The statement shall show the date, amount, and maturity of the loan contract, how and when repayable, the nature of the security, if any, for the loan, and the agreed rate of charge. (b) Obtain from the borrower a signed statement as to whether any person has performed any act as a broker in connection with the making of the loan. If such statement discloses a broker or other person has participated, the company shall obtain a full statement of all sums paid or payable to the broker or other person. (c) Keep the statements required by this section for a period of two years from and after the date the loan has been paid in full, or has matured according to its terms, or has been charged off. (Added by Stats. 1976, Ch. 964.)
  9. 18233.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Disclosure and Loan Documents [18230 - 18235] ( Article 3 added by Stats. 1976, Ch. 964. )

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    An industrial loan company must give a plain, complete receipt when it receives an in-person cash payment at any office for a loan.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Disclosure and Loan Documents [18230 - 18235] ( Article 3 added by Stats. 1976, Ch. 964. ) ## 18233. An industrial loan company shall deliver or cause to be delivered to the person making any payment in person in cash at any office of the company, at the time such payment is made on account of any loan, a plain and complete receipt showing the total amount received and identifying the loan contract upon which such payment is applied, and showing the unpaid balance of the loan. (Added by Stats. 1976, Ch. 964.)
  10. 18234.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Disclosure and Loan Documents [18230 - 18235] ( Article 3 added by Stats. 1976, Ch. 964. )

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    An industrial loan company must mark a loan note paid and return it after full repayment, and if the borrower owes nothing else, it must also release related security and return specified loan documents, with limited exceptions.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Disclosure and Loan Documents [18230 - 18235] ( Article 3 added by Stats. 1976, Ch. 964. ) ## 18234. An industrial loan company shall upon repayment of any loan in full, cancel or plainly mark “paid” and return to the borrower or person making final payment, the note evidencing the loan. If such borrower is not otherwise obligated to such company, the company shall release all security for such loan, endorse and return any certificate of ownership, and return to the borrower any security agreement, assignment, or order signed by the borrower, except such as are a part of the court record in any action, or such as have been delivered to a third person for the purpose of carrying out the terms thereof. (Added by Stats. 1976, Ch. 964.)
  11. 18235.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Disclosure and Loan Documents [18230 - 18235] ( Article 3 added by Stats. 1976, Ch. 964. )

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    An industrial loan company must not take a note, promise to pay, or security agreement unless it fully and accurately discloses the loan amount, term, and agreed rate of charge, and it must not take any instrument left with blanks to be filled in after execution.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Disclosure and Loan Documents [18230 - 18235] ( Article 3 added by Stats. 1976, Ch. 964. ) ## 18235. An industrial loan company shall not take any note, promise to pay, or security agreement that does not accurately disclose the actual amount of the loan, the time for which it is made, and the agreed rate of charge, nor any instrument in which blanks are left to be filled in after execution. (Added by Stats. 1976, Ch. 964.)
  12. 18245.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Credit Cards [18245- 18245.] ( Article 4 added by Stats. 1998, Ch. 827, Sec. 11. )

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    An industrial loan company may issue credit cards and may buy or hold obligations from their use, subject to commissioner regulations.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Credit Cards [18245- 18245.] ( Article 4 added by Stats. 1998, Ch. 827, Sec. 11. ) ## 18245. (a) Subject to any regulations that the commissioner may issue, an industrial loan company may issue credit cards and may acquire or hold obligations resulting from the use of credit cards. (b) Except as the commissioner may otherwise provide by regulation or order, the acquiring and holding of obligations pursuant to subdivision (a) are not subject to Article 2 (commencing with Section 18205) or Article 6.5 (commencing with Section 18300). (Added by Stats. 1998, Ch. 827, Sec. 11. Effective January 1, 1999.)
  13. 1825.

    ## 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 4. Voluntary Surrender of License [1825- 1825.] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 3. )

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    A foreign bank with a license may surrender it by filing the license and a report with the commissioner; if it has two or more office 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 20. Foreign (Other Nation) Banks [1750 - 1835] ( Chapter 20 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 4. Voluntary Surrender of License [1825- 1825.] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1825. (a) Any foreign (other nation) bank that holds a license to maintain an office may voluntarily surrender the license by filing the license and a report with the commissioner. However, any foreign (other nation) bank that holds licenses to maintain two or more offices may not voluntarily surrender less than all of the 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. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  14. 18265.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Limitations and Regulations of Loans and Purchased Obligations [18265 - 18274] ( Article 5 added by Stats. 1976, Ch. 964. )

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    An industrial loan company with investment certificates outstanding may not make, buy, or discount longer-term loans or obligations unless they are secured, the collateral is eligible by commissioner regulation, and the outstanding balance stays within the commissioner’s percentage limit.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Limitations and Regulations of Loans and Purchased Obligations [18265 - 18274] ( Article 5 added by Stats. 1976, Ch. 964. ) ## 18265. An industrial loan company that has investment certificates outstanding shall not make any loan or purchase or discount any other obligation with a maturity of more than 60 months and 15 days unless all of the following conditions are met: (a) The loan or other obligation is secured. (b) The property, or collateral securing the loan or other obligation, is of a kind or class that has been declared eligible by regulation of the commissioner. (c) The aggregate principal balance of such loans and other obligations outstanding with a remaining maturity of more than 60 months and 15 days at any time shall not exceed a percentage of the aggregate principal balance due on all loans and other obligations owing to the industrial loan company by rule of the commissioner. (Amended by Stats. 1983, Ch. 858, Sec. 21.)
  15. 18266.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Limitations and Regulations of Loans and Purchased Obligations [18265 - 18274] ( Article 5 added by Stats. 1976, Ch. 964. )

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    Industrial loan companies with investment certificates outstanding must keep certain loans sufficiently collateralized, generally at 110% of the debt, with some exceptions and special cases.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Limitations and Regulations of Loans and Purchased Obligations [18265 - 18274] ( Article 5 added by Stats. 1976, Ch. 964. ) ## 18266. (a) Except as set forth in subdivisions (b) and (c), any loan or obligation made or acquired by an industrial loan company that has investment certificates outstanding that is secured primarily by real property and has an outstanding principal balance of ten thousand dollars ($10,000) or more shall be secured by real property having a fair market value, or real property and personal property combined having a fair market value, at the time the loan or other obligation is made or acquired, of at least 110 percent of the principal amount owing on the loan or obligation and on prior encumbrances, except nondelinquent tax liens, secured by the same real property with regard to loans secured solely by real property, or by both real property and personal property. Fair market value of the real property for purposes of this section shall be determined by a real property appraiser who meets the qualifications established pursuant to Title XI of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989, Public Law 101-73, and any applicable regulations, guidelines, or policies thereunder. (b) Subdivision (a) does not apply to: (1) Any loan guaranteed in whole or in part by the Administrator of Veterans Affairs pursuant to the Servicemen’s Readjustment Act of 1944 or any act of Congress supplementary or amendatory thereof. (2) Any loan insured by the Federal Housing Administration pursuant to the National Housing Act or any act of Congress supplementary or amendatory thereof. (c) Subject to all other provisions of subdivision (a) and any requirements the commissioner may impose by rule or order, the following loans may be secured by real property having a fair market value of less than 110 percent of the principal amount of the loan and prior encumbrances: (1) Any loan made by an industrial loan company to facilitate the sale of real property owned by the industrial loan company resulting from foreclosure or receipt of a deed in lieu of foreclosure. (2) Any loan renewed or modified by an industrial loan company pursuant to a clearly defined and well-documented program adopted by the board of directors of the industrial loan company to achieve orderly repayment of the loan or to maximize recovery of the loan. (3) Any loan or obligation saleable in the secondary market. For purposes of this paragraph, “saleable in the secondary market” means saleable to a qualified institutional buyer, as evidenced by irrevocable commitments to buy by those qualified institutional buyers. (4) Any loan or obligation owned for less than 90 days. (d) In complying with the requirement of subdivision (a), an industrial loan company may include the principal amount of private mortgage insurance. (e) Any loan or obligation made or acquired by an industrial loan company that has investment certificates outstanding that is secured solely by motor vehicles or other personal property shall be secured by that property having a fair market value at the time the loan or other obligation is made or acquired of at least 100 percent of the principal amount owing on the loan or obligation. The personal property held as security shall be of a class or kind that has been declared eligible by regulation of the commissioner. (Amended by Stats. 1996, Ch. 227, Sec. 1. Effective January 1, 1997.)
  16. 18266.1.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Limitations and Regulations of Loans and Purchased Obligations [18265 - 18274] ( Article 5 added by Stats. 1976, Ch. 964. )

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    An industrial loan company may make or buy loans for home improvements if the loans are secured by real property meeting the stated value test.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Limitations and Regulations of Loans and Purchased Obligations [18265 - 18274] ( Article 5 added by Stats. 1976, Ch. 964. ) ## 18266.1. An industrial loan company may make loans and acquire obligations, the proceeds of which are used for home improvements that are secured by real property having a market value of at least 100 percent of the principal amount owing on the loan being made by the industrial loan company or obligation being acquired by the industrial loan company and on prior encumbrances, except nondelinquent tax liens, secured by the same real property. Home improvements means additions, alterations, or modifications to owner-occupied property consisting of one to four dwelling units and appurtenant buildings thereto or to the real property containing same. (Amended by Stats. 1998, Ch. 827, Sec. 12. Effective January 1, 1999.)
  17. 18266.2.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Limitations and Regulations of Loans and Purchased Obligations [18265 - 18274] ( Article 5 added by Stats. 1976, Ch. 964. )

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    An industrial loan company must file a written request to conduct business under Section 18266.1 and include specified information with the request.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Limitations and Regulations of Loans and Purchased Obligations [18265 - 18274] ( Article 5 added by Stats. 1976, Ch. 964. ) ## 18266.2. An industrial loan company shall file a written request for authorization to conduct business under Section 18266.1. The request shall include the following information: (a) A description of the company’s proposed plan of business. (b) The character, business qualifications, and other experience of the proposed officers and managers directing the line of business for which authorization is requested. (c) Any other facts and circumstances bearing on the proposal that, in the opinion of the commissioner, may be relevant. (Added by Stats. 1989, Ch. 889, Sec. 2.)
  18. 18266.3.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Limitations and Regulations of Loans and Purchased Obligations [18265 - 18274] ( Article 5 added by Stats. 1976, Ch. 964. )

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    The commissioner must approve the request within 30 days after filing unless the company fails to show required business-plan or management qualifications.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Limitations and Regulations of Loans and Purchased Obligations [18265 - 18274] ( Article 5 added by Stats. 1976, Ch. 964. ) ## 18266.3. The commissioner shall approve the request made pursuant to Section 18266.2 within 30 days after filing unless the commissioner has ascertained that the company has failed to show either of the following: (a) That the proposed plan of business has a reasonable promise of a successful operation. (b) That the company has a person with the necessary business qualifications, experience or ability to direct and manage the operations of the plan of business. (Added by Stats. 1989, Ch. 889, Sec. 3.)
  19. 18268.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Limitations and Regulations of Loans and Purchased Obligations [18265 - 18274] ( Article 5 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    An industrial loan company with investment certificates outstanding may not make certain secured loans above specified limits, unless the collateral or security falls within listed exceptions or is authorized by the commissioner.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Limitations and Regulations of Loans and Purchased Obligations [18265 - 18274] ( Article 5 added by Stats. 1976, Ch. 964. ) ## 18268. An industrial loan company that has investment certificates outstanding shall not lend in the aggregate more than 5 percent of its capital stock and surplus not available for dividends as provided in Section 18319 upon the security of the stock of any one corporation and that stock may not exceed 10 percent of the outstanding stock of the corporation, or upon the security of the bonds of any one obligor except bonds of the United States or for the payment of which the credit of the United States is pledged, bonds of the State of California, or for the payment of which the credit of the State of California is pledged, and any security authorized in writing by the commissioner or any security authorized by rule of the commissioner. (Amended by Stats. 1989, Ch. 663, Sec. 6. Operative January 1, 1991, by Sec. 20 of Ch. 663.)
  20. 18269.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Limitations and Regulations of Loans and Purchased Obligations [18265 - 18274] ( Article 5 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    An industrial loan company with outstanding investment certificates must not make certain real-property-secured loans above specified percentage limits.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Limitations and Regulations of Loans and Purchased Obligations [18265 - 18274] ( Article 5 added by Stats. 1976, Ch. 964. ) ## 18269. An industrial loan company that has investment certificates outstanding shall not make any loan secured primarily by improved real property in a principal amount in excess of 20 percent of the company’s unimpaired capital stock and surplus not available for dividends as provided in Section 18319. An industrial loan company that has investment certificates outstanding shall not make any loan secured primarily by unimproved real property in a principal amount in excess of 10 percent of the company’s unimpaired capital stock and surplus not available for dividends as provided in Section 18319. (Amended by Stats. 1989, Ch. 663, Sec. 7. Operative January 1, 1991, by Sec. 20 of Ch. 663.)
  21. 18270.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Limitations and Regulations of Loans and Purchased Obligations [18265 - 18274] ( Article 5 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    An industrial loan company may require a borrower to sign security-related documents for property used to secure a loan.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Limitations and Regulations of Loans and Purchased Obligations [18265 - 18274] ( Article 5 added by Stats. 1976, Ch. 964. ) ## 18270. An industrial loan company may require the borrower to sign a contract of pledge, assignment, mortgage, security agreement, deed of trust, or trust receipt relating to real or personal property given by the borrower as security for the repayment of the loan and interest and charges thereon. (Added by Stats. 1976, Ch. 964.)
  22. 18271.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Limitations and Regulations of Loans and Purchased Obligations [18265 - 18274] ( Article 5 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    Industrial loan companies with investment certificates outstanding may not exceed specified lending and obligation concentration limits for any one person.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Limitations and Regulations of Loans and Purchased Obligations [18265 - 18274] ( Article 5 added by Stats. 1976, Ch. 964. ) ## 18271. An industrial loan company that has investment certificates outstanding shall not make loans to, or hold the obligations of, any one person as primary obligor in an aggregate principal amount in excess of 20 percent of the unimpaired capital stock and surplus of the company not available for dividends as provided in Section 18319. Unsecured loans or obligations of any person as primary obligor made or held by a company may not, in any event, exceed in the aggregate principal amount 5 percent of the unimpaired capital stock and surplus of the company not available for dividends as provided in Section 18319. (Amended by Stats. 1989, Ch. 663, Sec. 8. Operative January 1, 1991, by Sec. 20 of Ch. 663.)
  23. 18272.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Limitations and Regulations of Loans and Purchased Obligations [18265 - 18274] ( Article 5 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    An industrial loan company must diversify its loans, lease obligations, and other obligations, but it may still specialize in its lending and leasing activities. The commissioner may issue rules under this section.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Limitations and Regulations of Loans and Purchased Obligations [18265 - 18274] ( Article 5 added by Stats. 1976, Ch. 964. ) ## 18272. An industrial loan company shall diversify the loans and lease obligations it makes and other obligations it acquires, both as to the types of debtors and obligors, types of collateral, and as to terms and types of repayment schedules. The requirement for diversification notwithstanding, an industrial loan company may specialize in its lending, leasing, and other authorized practices under this division. The commissioner may promulgate rules and regulations pursuant to this section. (Amended by Stats. 1984, Ch. 873, Sec. 4.)
  24. 18274.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Limitations and Regulations of Loans and Purchased Obligations [18265 - 18274] ( Article 5 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    An industrial loan company with investment certificates outstanding must not let certain unimproved-real-property loans or purchased obligations exceed 5% of its assets, unless the commissioner consents to collateral being taken to protect an existing jeopardized obligation.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Limitations and Regulations of Loans and Purchased Obligations [18265 - 18274] ( Article 5 added by Stats. 1976, Ch. 964. ) ## 18274. The principal balances of loans made, or obligations purchased, by an industrial loan company that has investment certificates outstanding, which loans or obligations are secured by unimproved real property, shall not in the aggregate exceed 5 percent of the company’s assets unless the commissioner consents to the taking of collateral to protect an existing jeopardized obligation. (Amended by Stats. 1986, Ch. 296, Sec. 4.)
  25. 18290.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 6. Insurance Sold With Loans [18290 - 18296] ( Article 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    An industrial loan company may offer certain loan-related insurance only with borrower consent and Insurance Commissioner approval, and the charge to the borrower is capped.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 6. Insurance Sold With Loans [18290 - 18296] ( Article 6 added by Stats. 1976, Ch. 964. ) ## 18290. (a) As used in this division: (1) “Credit life insurance” and “credit disability insurance” have the same meanings as defined in Section 779.2 of the Insurance Code. (2) “Credit loss-of-income insurance” means insurance issued to provide indemnity for payments becoming due on a specific loan or other credit transaction while the debtor is involuntarily unemployed, as defined in the policy. (b) An industrial loan company may provide and collect the costs for credit life insurance on the life of one or more of the borrowers, or credit disability, or loss-of-income insurance, or any combination of these coverages, to provide indemnity for payments becoming due on the indebtedness, with his or her consent, the form to be approved by the Insurance Commissioner, and a copy, together with evidence of its approval by the Insurance Commissioner, to be filed with the commissioner, and in an amount not in excess of the amount of the indebtedness. The amount charged to the borrower for credit life or disability insurance shall not exceed, in the case of credit life insurance, fifty cents ($0.50) per year per one hundred dollars ($100) of indebtedness (and in the same proportion for longer or shorter maturities and larger or smaller amounts) or the amount established by or pursuant to Section 779.35 of the Insurance Code, whichever is less, or, in the case of credit disability insurance, the amount established by or pursuant to Section 779.35 of the Insurance Code. (Amended by Stats. 1987, Ch. 1314, Sec. 1.)
  26. 18291.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 6. Insurance Sold With Loans [18290 - 18296] ( Article 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    If covered credit life, disability, or loss-of-income insurance is provided, it must be in force when the loan is made and must cover the loan amounts stated; an industrial loan company may not require that coverage as a loan condition.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 6. Insurance Sold With Loans [18290 - 18296] ( Article 6 added by Stats. 1976, Ch. 964. ) ## 18291. (a) If credit life or disability insurance is provided pursuant to this division, and if the insured borrower dies or becomes disabled during the term of the loan contract, the insurance shall be sufficient to pay the total amount due on the loan (excluding unearned charges) outstanding on the date of death, or all amounts which become due on the loan thereafter during the period of disability, as the case may be, without any exception, reservation, or limitation, subject, however, to the provisions of Section 18292. (b) Any credit life, disability, or loss-of-income insurance as provided shall be in force as soon as the loan is made. An industrial loan company shall not require any of these coverages as a condition of making a loan. (Amended by Stats. 1986, Ch. 813, Sec. 2.)
  27. 18292.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 6. Insurance Sold With Loans [18290 - 18296] ( Article 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    Credit disability insurance sold under this division must cover at least 14 days of disability, and certain pricing and benefit rules apply.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 6. Insurance Sold With Loans [18290 - 18296] ( Article 6 added by Stats. 1976, Ch. 964. ) ## 18292. (a) If credit disability insurance is provided pursuant to this division, it shall not provide indemnity against the risk of a borrower becoming disabled for a period of less than 14 days. The insurance may provide indemnity for any single period of continuous disability of 14 days or longer, after which the risk may become compensable. The insurance may be offered with retroactive coverage to an earlier date based upon the disability having continued for a period stated in the policy, but if insurance with retroactive coverage is offered, it shall also be offered without retroactive coverage, and the premium rate for each coverage shall be separately stated in writing to the borrower. (b) If insurance with retroactive coverage is provided, the coverage shall provide for a prorated payment based upon the fraction of the month during which the insured is disabled, provided that the insured is continuously disabled during the waiting period set forth in the policy. If insurance without retroactive coverage is provided, the coverage shall provide for a prorated payment based upon the fraction of the month during which the insured is disabled, after first excluding the elimination period set forth in the policy. For the purpose of this subdivision, a month is any period of 30 consecutive days. (c) Credit disability insurance, if made available by an industrial loan company, shall be available on a monthly or annual premium basis, and the premium by the month shall not exceed a pro rata relationship to the annual premium. Credit disability insurance need not be offered for a period less than the term of the loan to which it is applicable and no credit disability insurance shall be written for a period in excess of the term of the loan to which it is applicable. (d) The monthly disability benefit payable with respect to an open end loan shall not exceed the monthly payment computed pursuant to Section 18300 on the outstanding balance at the time the disability is incurred. (Amended by Stats. 1984, Ch. 199, Sec. 3.)
  28. 18292.5.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 6. Insurance Sold With Loans [18290 - 18296] ( Article 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    If credit loss-of-income insurance is offered under this division, it must meet specified coverage, disclosure, cancellation, minimum benefit, and anti-denial conditions.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 6. Insurance Sold With Loans [18290 - 18296] ( Article 6 added by Stats. 1976, Ch. 964. ) ## 18292.5. If credit loss-of-income insurance is provided pursuant to this division, it shall be subject to the following conditions: (a) The insurance shall provide indemnity in accordance with the terms of the policy after any single period of continuous unemployment of 45 days or less as determined by the policy, after which benefits shall commence. The insurance may be offered with retroactive coverage to an earlier date based upon unemployment having continued for the period stated in the policy. (b) The statement required by Section 18293 shall include disclosure of the term of the coverage, the conditions of coverage, the benefits to be paid, and the exclusions from coverage. (c) The borrower shall sign a certificate of voluntary acceptance of any credit loss-of-income insurance purchased. The certificate shall state in boldface type which is larger than the type used in the loan contract that purchase of the insurance is not a necessary condition to receiving the loan and that the insurance may be canceled by the borrower at any time within 15 days after it goes into force, in which event a full refund shall be made of the premium paid. (d) The minimum benefit shall be payment up to the agreed amount on not less than four benefit payments, as stated in the policy, which accrue during a covered period of unemployment, except that during the first 60 days after inception of the policy, the minimum benefit may be payment up to the agreed amount of one-half the number of benefit payments, as stated in the policy, which accrue during a covered period of unemployment. The maximum benefits shall be established in the contract of insurance. (e) If combination credit disability and loss-of-income coverage is offered, credit disability and credit loss-of-income coverages shall also be offered separately. (f) Benefits may not be denied because the insured cannot establish a valid claim for unemployment compensation benefits under Part 1 (commencing with Section 100) of Division 1 of the Unemployment Insurance Code solely because the former employer was not required to contribute to the State Unemployment Fund. (g) If insurance with retroactive coverage is provided, the coverage shall provide for a prorated payment based upon the fraction of the month during which the insured is unemployed, provided that the insured is continuously unemployed during the waiting period set forth in the policy. If insurance without retroactive coverage is provided, the coverage shall provide for a prorated payment based upon the fraction of the month during which the insured is unemployed, after first excluding the elimination period set forth in the policy. For the purpose of this subdivision, a month is any period of 30 consecutive days. (h) When unemployment continues for a number of months equal to or greater than the maximum number of benefit payments stated in the policy, the final payment shall be equal to the difference between a benefit payment and the initial prorated payment. (i) As used in this section, “benefit payment” means payment of an amount equal to a loan repayment installment or a maximum amount established in the contract of insurance, whichever is less. (j) The minimum benefit payment offered may not be less than the amount of a loan repayment installment unless the borrower or borrowers have two or more sources of income. If the maximum benefit payment offered is less than the amount of a loan repayment installment, the borrower shall also be offered coverage in which the maximum benefit payment is equal to the amount of a loan repayment installment. (Amended by Stats. 1987, Ch. 1314, Sec. 2.)
  29. 18293.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 6. Insurance Sold With Loans [18290 - 18296] ( Article 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    If an industrial loan company offers certain insurance with a loan, it must give the borrower a clear written statement explaining claim conditions and how to file a claim.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 6. Insurance Sold With Loans [18290 - 18296] ( Article 6 added by Stats. 1976, Ch. 964. ) ## 18293. If credit disability or loss-of-income insurance is provided pursuant to this division, the industrial loan company shall also deliver an understandable written statement to the borrower detailing the conditions when the borrower will be entitled to make a claim under the insurance policy and the procedure to be followed in making the claim. (Amended by Stats. 1998, Ch. 827, Sec. 13. Effective January 1, 1999.)
  30. 18294.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 6. Insurance Sold With Loans [18290 - 18296] ( Article 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    An industrial loan company may collect insurance costs for property securing a loan if the insurance and policy conditions in the section are met.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 6. Insurance Sold With Loans [18290 - 18296] ( Article 6 added by Stats. 1976, Ch. 964. ) ## 18294. An industrial loan company may collect the costs for insurance of tangible personal or real property offered as security for a loan, reasonably insured against loss for a reasonable term considering the circumstances of the loan, when the policy of insurance is made payable to the borrower or any member of his family, even though the customary mortgagee clause is attached, and if the insurance is sold at standard rates through duly licensed insurance agents. (Added by Stats. 1976, Ch. 964.)
  31. 18295.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 6. Insurance Sold With Loans [18290 - 18296] ( Article 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    An industrial loan company may collect title insurance costs for certain real-property-secured loans if the listed conditions are met.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 6. Insurance Sold With Loans [18290 - 18296] ( Article 6 added by Stats. 1976, Ch. 964. ) ## 18295. An industrial loan company may collect the costs of title insurance for loans secured primarily by real property. The costs for such insurance may be collected if: (1) The principal amount of the loan is at least one thousand dollars ($1,000); (2) The loan is secured by a lien of a deed of trust or mortgage on real property which is the subject of such policy of title insurance; (3) The policy of title insurance is made payable to the lender or jointly to such lender and the borrower as their interests may appear; (4) The coverage of such insurance may not exceed the lesser of the principal amount of the loan or the fair market value of the real property less prior encumbrances; (5) The insurance is placed at standard rates through a title insurance company authorized to do business in the State of California; (6) In connection with the renewal or extension of a loan, the additional cash advance is at least one thousand dollars ($1,000). Such costs as herein authorized are not included in the maximum charges which may be made under this division. (Amended by Stats. 1983, Ch. 858, Sec. 24.)
  32. 18296.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 6. Insurance Sold With Loans [18290 - 18296] ( Article 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    An industrial loan company may collect certain insurance costs, and those costs are not counted in the division’s maximum charges.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 6. Insurance Sold With Loans [18290 - 18296] ( Article 6 added by Stats. 1976, Ch. 964. ) ## 18296. An industrial loan company may collect the costs of insurance of the type defined by subdivision (a) of Section 12640.02 of the Insurance Code. Costs authorized by this section are not included in the maximum charges which may be made under this division. (Added by Stats. 1984, Ch. 199, Sec. 4.)
  33. 183.

    ## 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 “law of the domicile” differently depending on whether the bank is a national bank, a state bank, or 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. ) ## 183. “Law of the domicile” means: (a) When used with respect to a national bank, the law of the United States. (b) When used with respect to a state bank, the law of the state of the United States under which the bank is organized. (c) When used with respect to a foreign (other nation) bank, the law of the foreign nation under which the bank is organized. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  34. 1830.

    ## 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 5. Enforcement [1830 - 1835] ( Article 5 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    If the commissioner finds a violation of this chapter, related regulations, or an order issued under this chapter, the commissioner may order the person to pay a civil penalty 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 5. Enforcement [1830 - 1835] ( Article 5 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1830. If 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 329. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  35. 18300.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 6.5. Open-End Loans [18300 - 18303] ( Article 6.5 added by Stats. 1977, Ch. 939. )

    Verify source ↗

    This section defines “open-end loan” and sets rules for industrial loan companies that make them, including approval, disclosures, payment terms, insurance limits, recordkeeping, and several prohibitions.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 6.5. Open-End Loans [18300 - 18303] ( Article 6.5 added by Stats. 1977, Ch. 939. ) ## 18300. (a) As used in this article, “open-end loan” means a loan or loans made by an industrial loan company pursuant to a loan agreement which expressly states that it is made pursuant to this section and pursuant to which: (1) The industrial loan company may permit the borrower to obtain advances of money from the industrial loan company from time to time or the industrial loan company may advance money on behalf of the borrower from time to time as directed by the borrower. (2) The amount of each advance and the charges and other permitted costs are debited to an account. (3) The charges are computed from time to time on the unpaid balances of the borrower’s account, excluding from the computation any unpaid charges other than permitted fees, costs and expenses. (4) The borrower has the privilege of paying the account in full at any time or in monthly installments. (b) Subject to the written approval of the commissioner of the industrial loan company’s plan of business for making open-end loans as not being misleading or deceptive and subject to regulations the commissioner may promulgate with respect to open-end loans under Section 18347, an industrial loan company may make open-end loans pursuant to this section and may contract for and receive thereon charges as set forth in Section 18212. Such charges may be calculated on an amount not exceeding the greater of: (1) The actual daily unpaid balances of the open-end account in the billing cycle for which the charge is made, in which case one-thirtieth of the monthly rate may be charged for each day the unpaid balance is outstanding. (2) The average daily unpaid balance of the open-end account in the billing cycle for which the charge is made, which is the sum of the amount unpaid each day during that cycle divided by the number of days in that cycle. The amount unpaid on a day is determined by adding to the balance unpaid as of the beginning of that day all advances and other debits and deducting all payments and other credits made or received as of that day. The billing cycle shall be monthly. A billing cycle is monthly if the closing date of that cycle is the same date each month or does not vary by more than four days from the regular date. (c) No industrial loan company shall enter into any agreement for an open-end loan that provides for a minimum payment that would result in the full repayment of principal over more than the maximum periods set forth below opposite the respective size of loans. Principal amount of loan Maximum period Less than $1,500 ........................ 24 months and 15 days $1,500 but less than $2,500 ........................ 36 months and 15 days $2,500 but less than $4,000 ........................ 48 months and 15 days $4,000 but less than $6,000 ........................ 60 months and 15 days $6,000 but less than $10,000 ........................ 84 months and 15 days The minimum payment shall be determined by the amount of the initial loan advance and shall continue at that amount until a subsequent loan advance is made, at which time the minimum payment shall be determined by the amount of the unpaid balance of the loan after the advance and including the advance. Minimum payments after each advance shall be determined in the same manner. (d) On open-end loans the industrial loan company may contract for and receive the fees, costs and expenses permitted on other loans, including those permitted by Sections 18215, 18218, 18290, 18294, and 18412, subject to all of the conditions and restrictions set forth in those sections with the following variations: (1) The charge for credit life insurance shall be on a monthly basis. No credit life insurance written in connection with an open-end loan shall be cancelled by the lender because of delinquency of the borrower in the making of the minimum payments thereon unless one or more of such payments is past due for a period of 90 days or more, and the lender shall advance to the insurer the amounts required to keep the insurance in force during such period, which amounts may be debited to the borrower’s account. (e) An industrial loan company shall not make an open-end loan in excess of ten thousand dollars ($10,000) principal amount. (f) The loan contract shall provide for payment of minimum payments complying with subdivision (c). All loans made pursuant to this section shall be repayable by equal or substantially equal monthly payments during the term of the loan. (g) In lieu of applying the provisions of Section 18290, the provisions contained herein shall apply to open-end loans. An industrial loan company may provide insurance on the life of one or more borrowers with the borrower’s consent. The form of the insurance shall be approved by the Insurance Commissioner and shall be in an amount not in excess of the indebtedness. The amount charged to the borrower for such insurance shall not exceed the amount provided in paragraph (1) or (2) following, whichever is less: (1) The premium rate filed with the Insurance Commissioner for the coverage provided pursuant to Article 5.9 (commencing with Section 779.1) of Chapter 1 of Part 2 of Division 1 of the Insurance Code and which has not been disapproved by the Insurance Commissioner. (2) Fifty cents ($0.50) per year per one hundred dollars ($100) of indebtedness (and in the same proportion for longer or shorter maturities and larger or smaller amounts) or such different maximum as is fixed by the Insurance Commissioner by a valid and effective regulation hereafter adopted. Notwithstanding Section 18291, any such life insurance shall be in force as soon as the loan is made or coverage is agreed upon, whichever is later. (h) The open-end loan agreement shall contain the name and address of the industrial loan company and shall disclose the nature of the security taken, if any, the method of determining the minimum payments which will be required to repay the initial advance, and any subsequent advances on the loan, and the agreed rate of charge. (i) At the time the open-end loan agreement is made the industrial loan company shall obtain from the borrower a signed statement as to whether any person has performed any act as a broker in connection with the making of the loan. If such statement discloses a broker or other person has participated, the company shall obtain a full statement of all sums paid or payable to the broker or other person. The open-end loan agreement and the statement required by this subdivision shall be kept for a period of two years after the date the loan has been paid in full, or has matured according to its terms, or has been charged off. (j) Except in the case of an account which the industrial loan company deems to be uncollectible, or with respect to which delinquency collection procedures have been instituted, the company shall deliver or cause to be delivered to the borrower, or any one thereof, for each billing cycle at the end of which there is an outstanding balance in the account or with respect to which a finance charge is imposed, a statement setting forth the outstanding balance in the account at the beginning of the billing cycle, the date and amount of any subsequent loan advance during the period, the amounts and dates of crediting to the account during the billing cycle for payments, the amount of any finance charge debited to the account during the billing cycle, the annual percentage rate of finance charged determined under Regulation Z promulgated by the Board of Governors of the Federal Reserve System (12 C.F.R. 226), the balance on which the finance charge was computed, the closing date of the billing cycle, the outstanding balance on that date, and the minimum monthly payment required in the absence of any additional advance. If there has been any change in the nature of the security for the loan since the next preceding advance, the statement shall contain or be accompanied by a statement of the nature of the security for the loan after such change. (k) An industrial loan company shall not take any instrument in connection with an open-end loan in which blanks are left to be filled in after execution. (l) Subdivision (a) of Section 18205, and Sections 18206, 18214, 18222, 18231, and 18235 shall not apply to open-end loans. (m) An industrial loan company shall not make an open-end loan secured by real property in whole or in part. (n) An industrial loan company shall not charge for, offer or provide credit disability insurance in connection with an open-end loan. (o) This section shall not apply to loans other than open-end loans. (Amended by Stats. 1985, Ch. 297, Sec. 2.)
  36. 18301.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 6.5. Open-End Loans [18300 - 18303] ( Article 6.5 added by Stats. 1977, Ch. 939. )

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    A qualifying industrial loan company may make a secured line of credit loan only when authorized by the commissioner, and the loan’s security must be of a kind and class the commissioner has declared eligible.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 6.5. Open-End Loans [18300 - 18303] ( Article 6.5 added by Stats. 1977, Ch. 939. ) ## 18301. (a) Whenever authorized by the commissioner, an industrial loan company whose thrift obligations are insured by the Federal Deposit Insurance Corporation may make a secured line of credit loan. Security for line of credit loans shall be of a kind and class that has been declared eligible by the commissioner. (b) Line of credit loans authorized under Title VIII (Alternative Mortgage Transaction Party Act of 1982) of the Garn-St. Germain Depository Institutions Act of 1982 are not subject to subdivision (a). (c) As used in this article, “line of credit loan” means a loan whereby a borrower requests and a company disburses loan proceeds in an installment or installments during the term of the loan by an advance or series of advances, whether or not the timing of the advance or advances is known on the date the loan is approved by the company. (d) This section does not apply to secured line of credit lending activities engaged in on or before May 1, 1989, unless, after that date there is a change in the secured line of credit plan of business by the company. (Added by Stats. 1989, Ch. 889, Sec. 4.)
  37. 18302.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 6.5. Open-End Loans [18300 - 18303] ( Article 6.5 added by Stats. 1977, Ch. 939. )

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    An industrial loan company must file a written request to be authorized to conduct business under Section 18301(a).

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 6.5. Open-End Loans [18300 - 18303] ( Article 6.5 added by Stats. 1977, Ch. 939. ) ## 18302. An industrial loan company shall file a written request for authorization to conduct business under subdivision (a) of Section 18301. The request shall include all of the following information: (a) A description of the company’s proposed plan of business. (b) The character, business qualifications, and other experience of the proposed officers and managers directing the line of business for which authorization is requested. (c) Any other facts and circumstances bearing on the proposal that, in the opinion of the commissioner, may be relevant. (Added by Stats. 1989, Ch. 889, Sec. 5.)
  38. 18303.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 6.5. Open-End Loans [18300 - 18303] ( Article 6.5 added by Stats. 1977, Ch. 939. )

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    The commissioner must approve the Section 18302 request within 30 days after filing, unless the commissioner finds the company failed to show one of the required business conditions.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 3. Loans and Purchased Obligations [18190 - 18303] ( Chapter 3 added by Stats. 1976, Ch. 964. ) ## ARTICLE 6.5. Open-End Loans [18300 - 18303] ( Article 6.5 added by Stats. 1977, Ch. 939. ) ## 18303. The commissioner shall approve the request made pursuant to Section 18302 within 30 days after filing unless the commissioner has ascertained that the company has failed to show either of the following: (a) That the proposed plan of business has a reasonable promise of a successful operation. (b) That the company has a person with the necessary business qualifications, experience, or ability to direct and manage the operations of the plan of business. (Added by Stats. 1989, Ch. 889, Sec. 6.)
  39. 1831.

    ## 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 5. Enforcement [1830 - 1835] ( Article 5 added by Stats. 2011, Ch. 243, Sec. 3. )

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

    ## 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 5. Enforcement [1830 - 1835] ( Article 5 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1831. If, after notice and a hearing, the commissioner finds any of the following with respect to a foreign (other nation) bank that is licensed to maintain an office, the commissioner may issue an order suspending or revoking the license of the bank: (a) That the bank has violated any provision of this division or of any regulation or order issued under this division or any provision of any other applicable law, regulation, or order; (b) That the bank, in case it is licensed to transact business in this state, is transacting the business in an unsafe or unsound manner or, in any case, is transacting business elsewhere in an unsafe or unsound manner; (c) That the bank is in unsafe or unsound condition; (d) That the bank has ceased to operate its office; (e) That the bank 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 bank 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 bank 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 any such relief under any such law against the bank and the bank 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 bank or that any proceeding for such an appointment or any similar proceeding has been initiated in the place where the bank is domiciled; (i) That the existence of the bank or the authority of the bank to transact banking business under the laws of the place where the bank is domiciled has been suspended or terminated; or (j) That any fact or condition exists that, if it had existed at the time when the bank applied for its license to transact business in this state, would have been grounds for denying the application. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  40. 18315.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 4. Investment Certificates [18315 - 18325] ( Chapter 4 added by Stats. 1976, Ch. 964. )

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    An industrial loan company may sell and issue investment certificates if authorized, while the commissioner may impose and change terms on those certificates.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 4. Investment Certificates [18315 - 18325] ( Chapter 4 added by Stats. 1976, Ch. 964. ) ## 18315. (a) When authorized to conduct business pursuant to this division, an industrial loan company may sell and issue its investment certificates subject to the provisions of this division. The commissioner may, by written order directed to a company or by rule or regulation, impose terms and conditions upon investment certificates and the sale or redemption thereof or the payment of interest thereon, as he or she deems reasonable and necessary or advisable for the protection of the company or the public, and he or she may from time to time in his or her discretion amend, alter or revoke any such order or regulation or any condition or provision thereof. (b) Any change in the form, terms, or provisions of outstanding investment certificates or in the rights, privileges, or restrictions upon the holder or issuer thereof is deemed a sale and issuance of investment certificates. (c) The company named in any order issued pursuant to subdivision (a) of this section may, within 15 days after receipt thereof, file with the commissioner its written request for hearing. The filing of the request shall not operate to postpone or suspend the effectiveness of any order issued by the commissioner unless otherwise directed by the commissioner. The commissioner shall, within 15 days after the receipt of the written request or at such later time as may be mutually agreed with the company, cause the matter to be heard and shall thereafter issue his final decision. The decision may be amended or set aside by the commissioner at any time. (d) Every order or decision of the commissioner made pursuant to this section is subject to judicial review in accordance with law. (Amended by Stats. 1998, Ch. 827, Sec. 14. Effective January 1, 1999.)
  41. 18316.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 4. Investment Certificates [18315 - 18325] ( Chapter 4 added by Stats. 1976, Ch. 964. )

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    An industrial loan company may sell or negotiate investment certificates and may structure payment terms in the certificates and collect payments in installments or otherwise, with or without interest on installments.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 4. Investment Certificates [18315 - 18325] ( Chapter 4 added by Stats. 1976, Ch. 964. ) ## 18316. An industrial loan company may, in addition to the sale of installment investment certificates with loans, sell or negotiate investment certificates either in certificates, or in receipt book form. The certificates may provide for the payment of money at any time, either fixed or uncertain. The company may receive payments therefor in installments or otherwise, with or without an allowance of interest upon such installments. (Added by Stats. 1976, Ch. 964.)
  42. 18317.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 4. Investment Certificates [18315 - 18325] ( Chapter 4 added by Stats. 1976, Ch. 964. )

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    A company must not have investment certificates outstanding with a person or related persons above 20% of its unimpaired capital stock and surplus not available for dividends, except as provided in Section 18319.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 4. Investment Certificates [18315 - 18325] ( Chapter 4 added by Stats. 1976, Ch. 964. ) ## 18317. No company may have investment certificates outstanding with a person or related persons in an aggregate amount in excess of 20 percent of the unimpaired capital stock and surplus of the company not available for dividends as provided in Section 18319. (Amended by Stats. 1989, Ch. 663, Sec. 10. Operative January 1, 1991, by Sec. 20 of Ch. 663.)
  43. 18318.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 4. Investment Certificates [18315 - 18325] ( Chapter 4 added by Stats. 1976, Ch. 964. )

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    A minor can hold an investment or thrift certificate, and the certificate is for the minor’s exclusive benefit.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 4. Investment Certificates [18315 - 18325] ( Chapter 4 added by Stats. 1976, Ch. 964. ) ## 18318. Investment or thrift certificates may be issued to or in the name of a minor and as such shall be for the exclusive right and benefit of such minor and may be redeemed in whole or part by said minor or his order and payment so made is a valid release and discharge to the company for such payment. (Added by Stats. 1976, Ch. 964.)
  44. 18318.5.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 4. Investment Certificates [18315 - 18325] ( Chapter 4 added by Stats. 1976, Ch. 964. )

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    A multiple-party investment or thrift certificate is governed by the Probate Code provisions on multiple-party accounts.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 4. Investment Certificates [18315 - 18325] ( Chapter 4 added by Stats. 1976, Ch. 964. ) ## 18318.5. An investment or thrift certificate that is a multiple-party account as defined in Section 5132 of the Probate Code is governed by Part 2 (commencing with Section 5100) of Division 5 of the Probate Code. (Amended by Stats. 1990, Ch. 79, Sec. 11. Operative July 1, 1991, pursuant to Stats. 1990, Ch. 710, Sec. 46.)
  45. 18319.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 4. Investment Certificates [18315 - 18325] ( Chapter 4 added by Stats. 1976, Ch. 964. )

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    An industrial loan company may not have investment certificates outstanding above a 20-times capital-and-surplus cap, and the commissioner may further limit that amount by rule or order.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 4. Investment Certificates [18315 - 18325] ( Chapter 4 added by Stats. 1976, Ch. 964. ) ## 18319. In no event shall an industrial loan company have outstanding at any time its investment certificates (exclusive of those hypothecated with the company issuing them) in an aggregate sum in excess of 20 times the aggregate amount of its paid-up and unimpaired capital and such of its unimpaired surplus as is declared by a bylaw of the company to be not available for cash dividends. The commissioner by rule or by order issued pursuant to Section 18315, may limit the amount of outstanding investment certificates of an industrial loan company. (Amended by Stats. 1983, Ch. 858, Sec. 29.)
  46. 1832.

    ## 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 5. Enforcement [1830 - 1835] ( Article 5 added by Stats. 2011, Ch. 243, Sec. 3. )

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    The commissioner may suspend or revoke a foreign bank’s license if certain factors are true and immediate action is needed for creditor protection or the public interest.

    ## 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 5. Enforcement [1830 - 1835] ( Article 5 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1832. (a) If the commissioner finds that any of the factors set forth in Section 1831 is true with respect to any foreign (other nation) bank that is licensed to maintain an office and that it is necessary, in case the bank is licensed to transact business in this state, for the protection of the interests of creditors of the bank’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 bank, the commissioner may issue an order suspending or revoking the license of the bank. (b) (1) Within 30 days after an order is issued pursuant to subdivision (a), the foreign (other nation) bank 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 bank 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) bank 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 bank to apply to the commissioner for a hearing on the order pursuant to paragraph (1). (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  47. 18320.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 4. Investment Certificates [18315 - 18325] ( Chapter 4 added by Stats. 1976, Ch. 964. )

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    An industrial loan company is limited in how many investment certificates it may have outstanding, with higher limits available only after certain operating periods and subject to application and reserve requirements.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 4. Investment Certificates [18315 - 18325] ( Chapter 4 added by Stats. 1976, Ch. 964. ) ## 18320. Notwithstanding Section 18319, an industrial loan company shall in no event: (a) Have outstanding at any time during its first 12 months of operation as an industrial loan company under this division, its investment certificates (exclusive of those hypothecated with the company issuing them) in an aggregate sum in excess of six times the aggregate amount of its paid-up and unimpaired capital and unimpaired surplus not available for dividends pursuant to Section 18319. (b) After 12 months of operation as an industrial loan company under this division and during the next 12 months of operation the industrial loan company may file an application with the commissioner seeking authority to increase the aggregate sum of its investment certificates which (exclusive of those investment certificates hypothecated with the company issuing them) in no event shall exceed eight times the aggregate amount of its paid-up and unimpaired capital and unimpaired surplus not available for dividends pursuant to Section 18319. (c) After 24 months of operation as an industrial loan company under this division and during the next 24 months of operation the company may file an application with the commissioner seeking authority to increase the aggregate sum of its investment certificates which (exclusive of those investment certificates hypothecated with the company issuing them) in no event shall exceed 12 times the aggregate amount of its paid-up and unimpaired capital and unimpaired surplus not available for dividends pursuant to Section 18319. (d) If after 36 months of operation as an industrial loan company under this division the outstanding investment certificates of a company are insured by the Federal Deposit Insurance Corporation, the company may file an application with the commissioner seeking authority to increase the aggregate sum of its investment certificates which it may have outstanding to the extent authorized by the capital-adequacy requirements of the federal Deposit Insurance Corporation. An industrial loan company that is authorized to increase the aggregate sum of its investment certificates to the extent authorized by the capital-adequacy requirements of the Federal Deposit Insurance Corporation also shall meet the requirements of subdivisions (e) and (f). (e) After 48 months of operation as an industrial loan company under this division and during the next 12 months of operation the company may file an application with the commissioner seeking authority to increase the aggregate sum of its investment certificates which, exclusive of those investment certificates hypothecated with the company issuing them, in no event shall exceed 15 times the aggregate amount of its paid-up and unimpaired capital and unimpaired surplus not available for dividends pursuant to Section 18319, only if both of the following requirements are met: (1) A company shall maintain a liquidity reserve in cash, or cash equivalent, equal to 11/2 percent of its total investment certificates outstanding. “Cash equivalent” means investments legal for commercial banks under the laws of this state, with a maturity of not more than 12 months. (2) In addition to the reserve for losses required by the commissioner pursuant to Section 18343, a company shall establish and maintain such special reserves for losses as the commissioner, by rule or order, may require. (f) After 60 months of operation as an industrial loan company under this division, the company may file an application with the commissioner seeking authority to increase the aggregate sum of its investment certificates which it may have outstanding, which, exclusive of those investment certificates hypothecated with the company issuing them, in no event shall exceed 20 times the aggregate amount of its paid-up and unimpaired capital and unimpaired surplus not available for dividends pursuant to Section 18319, and which may exceed 15 times the amount of its paid-up and unimpaired capital and unimpaired surplus not available for dividends pursuant to Section 18319 only if the requirements of subdivision (e) are met and the capital stock is not less than one million two hundred fifty thousand dollars ($1,250,000) and the unimpaired paid-in surplus is not less than seven hundred fifty thousand dollars ($750,000). (g) Whenever the commissioner deems it reasonable and necessary or advisable for the protection of the public (including the fact that an industrial loan company is not a member of the Federal Deposit Insurance Corporation), the commissioner may at any time by order authorize said industrial loan company to have its investment certificates outstanding in either a lesser aggregate sum than the maximum aggregate amounts permitted by subdivision (a), (b), (c), (d), (e), or (f), or none at all. (h) The request for authority filed with the commissioner pursuant to subdivisions (b), (c), (d), (e), and (f) shall be set forth in an application in such form and containing such information as the commissioner may require. (i) The commissioner shall by rule or regulation set forth the criteria that must be met before an industrial loan company can be granted authority to increase the aggregate sum of its outstanding investment certificates. (j) If the commissioner does not within 60 days of the filing of an application grant a request by an industrial loan company operating under this division, for authority to increase the aggregate sum of its outstanding investment certificates to the requested amount, or issues an order pursuant to subdivision (g), the company may file with the commissioner its written request for hearing in accordance with subdivisions (c) and (d) of Section 18315. (Amended by Stats. 1987, Ch. 787, Sec. 3.)
  48. 18321.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 4. Investment Certificates [18315 - 18325] ( Chapter 4 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    An industrial loan company may not receive demand deposits, and it may use the term “certificate of deposit” for certain investment certificates if the stated conditions are met.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 4. Investment Certificates [18315 - 18325] ( Chapter 4 added by Stats. 1976, Ch. 964. ) ## 18321. (a) Nothing in this division authorizes an industrial loan company to receive demand deposits. (b) Subject to Section 18315, an industrial loan company that is a member of the Federal Deposit Insurance Corporation pursuant to Section 18521.5 may use the term “certificate of deposit” as defined in Section 18003.6 with respect to an investment certificate that does not authorize either of the following: (1) Redemption prior to its maturity. (2) Reduction of the interest rate payable thereon other than a variable interest rate. (Amended by Stats. 1999, Ch. 345, Sec. 3. Effective January 1, 2000.)
  49. 18322.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 4. Investment Certificates [18315 - 18325] ( Chapter 4 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    An industrial loan company must get the commissioner’s written consent before accepting money under Section 17409.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 4. Investment Certificates [18315 - 18325] ( Chapter 4 added by Stats. 1976, Ch. 964. ) ## 18322. An industrial loan company shall obtain the written consent of the commissioner prior to accepting any moneys pursuant to Section 17409. The commissioner may, by regulation or order, impose or revise limitations and requirements, including, but not limited to, liquidity and reserve requirements, as, in the opinion of the commissioner, are necessary for safety and soundness. The commissioner shall rescind that consent if, at any time, the industrial loan company exceeds the limitations or fails to adhere to the requirements imposed or, if in the opinion of the commissioner, the continued acceptance of those moneys would pose a threat to the safety and soundness of the company. (Added by Stats. 1990, Ch. 1306, Sec. 3.)
  50. 18325.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 4. Investment Certificates [18315 - 18325] ( Chapter 4 added by Stats. 1976, Ch. 964. )

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    An industrial loan company may not charge a customer for failing to make, or making late, a periodic installment investment on a periodic investment or thrift certificate, and must pay interest at the same annual rate as comparable non-periodic certificates.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 4. Investment Certificates [18315 - 18325] ( Chapter 4 added by Stats. 1976, Ch. 964. ) ## 18325. (a) An industrial loan company shall not impose any charge on a periodic investment or thrift certificate, or on an investor in an account evidenced by such certificate, for the failure of an investor to invest, or for the late investment of, any agreed periodic installment investment into such an account. An industrial loan company shall pay interest on periodic investment or thrift certificates at the same rate of interest per annum as is paid on investment or thrift certificates as to which an investor has not agreed to make periodic installment investments. (b) As used in this section “periodic investment or thrift certificate” means an investment arrangement under which an investor undertakes to make periodic investments of a specified amount into one account, except, however, a periodic investment or thrift certificate shall not mean an impound account established for the purposes of the payment of taxes or other expenses and obligations in connection with a loan secured by real property, or a certificate of investment issued in connection with a loan pursuant to Section 18322. (Added by Stats. 1976, Ch. 964.)
  51. 1833.

    ## 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 5. Enforcement [1830 - 1835] ( Article 5 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    A foreign bank whose office license is suspended or revoked must immediately surrender the license 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 5. Enforcement [1830 - 1835] ( Article 5 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1833. Any foreign (other nation) bank whose license to maintain an office is suspended or revoked shall immediately surrender the license to the commissioner. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  52. 1834.

    ## 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 5. Enforcement [1830 - 1835] ( Article 5 added by Stats. 2011, Ch. 243, Sec. 3. )

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    A foreign bank subject to an order under Sections 1831 or 1832 may ask the commissioner to modify or rescind the order, and its right to seek judicial review is not lost if it does not make that request first.

    ## 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 5. Enforcement [1830 - 1835] ( Article 5 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1834. (a) Any foreign (other nation) bank to which an order is issued under Section 1831 or 1832 may apply to the commissioner to modify or rescind such order. The commissioner shall not grant the application unless he or she finds that it is in the public interest to do so and that it is reasonable to believe that the bank will, if and when it is again licensed 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) bank to which an order is issued under Section 1831 or 1832 to petition for judicial review of the order shall not be affected by the failure of the bank to apply to the commissioner pursuant to subdivision (a) to modify or rescind the order. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  53. 1835.

    ## 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 5. Enforcement [1830 - 1835] ( Article 5 added by Stats. 2011, Ch. 243, Sec. 3. )

    Verify source ↗

    The commissioner may take possession of a foreign bank’s property and business if the stated conditions are met, and later liquidate it or return remaining assets. The bank can ask the superior court to stop further proceedings, and the court can issue orders after a hearing.

    ## 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 5. Enforcement [1830 - 1835] ( Article 5 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1835. (a) If the commissioner finds that any of the factors set forth in Section 1831 is true with respect to any foreign (other nation) bank which is licensed to transact business in this state and that it is necessary for the protection of the interests of the creditors of such bank’s business 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 bank, the commissioner may by order forthwith take possession of the property and business of the bank and retain possession until the bank resumes business in this state or is finally liquidated. The bank may, with the consent of the commissioner, resume business in this state upon such conditions as the commissioner may prescribe. (b) (1) Whenever the commissioner takes possession of the property and business of a foreign (other nation) bank pursuant to subdivision (a), such bank may, within 10 days, apply to the superior court in the county in which the primary office of the bank 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 such application or enjoin the commissioner from further proceedings and order him or her to surrender the property and business of the bank to the bank or make such further order as may be just. (2) The judgment of the court may be appealed by the commissioner or by the bank 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, such 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) bank pursuant to subdivision (a), the commissioner shall conserve or liquidate the property and business of the bank pursuant to Chapter 6 (commencing with Section 550) and Chapter 7 (commencing with Section 600) of Division 1, and the provisions of those chapters shall apply, except Sections 592, 593, and 690, as if the bank were a bank organized under the laws of this state. (d) When the commissioner has completed the liquidation of the property and business of a foreign (other nation) bank, the commissioner shall transfer any remaining assets to such bank in accordance with such orders as the court may issue. However, in case the bank has an office in another state of the United States which is in liquidation and the assets of such office appear to be insufficient to pay in full the creditors of the office, the court shall order the commissioner to transfer to the liquidator of the office such amount of any such remaining assets as appears to be necessary to cover such insufficiency; if there are two or more such offices and the amount of remaining assets is less than the aggregate amount of insufficiencies with respect to the offices, the court shall order the commissioner to distribute the remaining assets among the liquidators of such offices in such manner as the court finds equitable. (Amended by Stats. 2013, Ch. 334, Sec. 44. (SB 537) Effective January 1, 2014.)
  54. 18390.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. Examinations [18390 - 18396] ( Article 2 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    The commissioner may investigate and examine covered industrial loan company businesses and related records, and may access their business premises and records.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. Examinations [18390 - 18396] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18390. For the purpose of discovering violations of this division or securing information required, the commissioner may at any time investigate the affairs and examine the books, accounts, records, and files of every corporation engaged in the business of an industrial loan company or broker, or its holding company or affiliates, whether such corporation acts or claims to act as principal or agent, or under or without the authority of this division. For the purposes of examination and investigation, the commissioner and the commissioner’s duly designated representatives shall have free access to the offices and places of business, books, accounts, papers, records, files, safes and vaults of all such corporations and their holding companies or affiliates. (Amended by Stats. 1980, Ch. 418, Sec. 3.)
  55. 18391.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. Examinations [18390 - 18396] ( Article 2 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    The commissioner may conduct extra examinations or investigations, and do necessary related services, when an industrial loan company’s condition appears to need extraordinary attention.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. Examinations [18390 - 18396] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18391. Whenever in the judgment of the commissioner the condition of any industrial loan company renders it necessary or expedient to devote any extraordinary attention to its affairs, the commissioner may make any extra examination or investigation and perform any necessary services in connection with its affairs. (Added by Stats. 1976, Ch. 964.)
  56. 18392.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. Examinations [18390 - 18396] ( Article 2 added by Stats. 1976, Ch. 964. )

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    An industrial loan company that is examined must pay the commissioner’s examination, investigation, and service costs, including related compensation and overhead.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. Examinations [18390 - 18396] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18392. The industrial loan company examined shall pay to the commissioner the cost of any examination, investigation or services, including the salary or other compensation paid to the persons making the examination or investigation or rendering services, and overhead costs in connection therewith as fixed by the commissioner. In determining the cost of examination, investigation, or services, the commissioner may use the estimated average hourly cost for all persons performing examinations, investigations, or services for industrial loan companies for the fiscal year. (Amended by Stats. 1981, Ch. 946, Sec. 4.)
  57. 18393.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. Examinations [18390 - 18396] ( Article 2 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    The commissioner must examine the affairs and records of certain industrial loan companies at least once a year after receiving written notice that they intend to engage in permitted transactions.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. Examinations [18390 - 18396] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18393. The commissioner shall, upon receipt of written notification by an industrial loan company that it intends to engage in or is engaging in transactions permitted under Section 18209, make an examination of the affairs and records of each such industrial loan company at least once each year. Such examination shall be made or performed unless such company notifies the commissioner of its election to discontinue such activity and gives evidence that it has disposed of all evidences of indebtedness arising from any such transactions. (Added by Stats. 1976, Ch. 964.)
  58. 18394.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. Examinations [18390 - 18396] ( Article 2 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    These reports are not public records. They may be disclosed to the officers and directors of the affected company for corrective action.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. Examinations [18390 - 18396] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18394. Investigation and examination reports prepared by the commissioner’s duly designated representatives shall not be public records. Those reports may be disclosed to the officers and directors of a company that is the subject of a report for the purpose of corrective action by those officers or directors. That type of disclosure shall not operate as a waiver of the exemption specified in Section 7929.000 of the Government Code. (Amended by Stats. 2021, Ch. 615, Sec. 110. (AB 474) Effective January 1, 2022. Operative January 1, 2023, pursuant to Sec. 463 of Stats. 2021, Ch. 615.)
  59. 18396.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. Examinations [18390 - 18396] ( Article 2 added by Stats. 1976, Ch. 964. )

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    The commissioner may give information to certain governmental agencies in several situations.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. Examinations [18390 - 18396] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18396. (a) In this section, “governmental agency” includes, without limitation, any agency of this state, of any other state of the United States, of the United States, or of any foreign nation. (b) The commissioner may furnish information to a governmental agency that regulates financial institutions. (c) The commissioner may furnish to a governmental agency that administers a loan guarantee or similar program, information relating to a person who participates in the program. (d) The commissioner may furnish to a governmental agency that regulates business activities, other than the type described in subdivision (b), information relating to: (1) A suspected violation of a law administered by the agency. (2) A person involved in an application to the agency for a license, approval, or other authorization. (e) The commissioner may furnish to a governmental agency that is a law enforcement agency, information relating to a suspected crime. (f) This section does not prescribe the only circumstances under which the commissioner may furnish information. (Added by Stats. 1995, Ch. 479, Sec. 5. Effective October 2, 1995.)
  60. 18405.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Reports and Financial Statements [18405 - 18412] ( Article 3 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    Industrial loan companies must file an annual audit report with the commissioner by March 15 and follow required accounting and auditing standards.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Reports and Financial Statements [18405 - 18412] ( Article 3 added by Stats. 1976, Ch. 964. ) ## 18405. (a) On or before the 15th day of March of every year, each industrial loan company shall file with the commissioner an audit report containing audited financial statements together with such other relevant information as the commissioner may require relating to the company and to each place of business of the company. The audited financial statements shall include a balance sheet of the company prepared as of the last day of the preceding calendar year and statements of income and of surplus for such calendar year. (b) The reports and financial statements referred to in subdivision (a) 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, and shall contain such relevant information as the commissioner may require. The audits shall be conducted in accordance with generally accepted auditing standards and the rules and regulations of the commissioner. (c) For good cause and upon written request, the commissioner may extend the time for compliance with subdivision (a). (d) If the report, certificate, or opinion of the independent accountant referred to in subdivision (b) hereof is in any way qualified, the commissioner may require the company to take such action as he or she deems appropriate to permit an independent accountant to remove such qualification from the report, certificate, or opinion. (e) The commissioner may reject any financial statement, report, certificate, or opinion filed pursuant to this section by notifying the company required to make such filing of its rejection and the cause thereof. Within 30 days after the receipt of such notice, the company shall correct such deficiency, and the failure so to do shall be deemed a violation of this division. The commissioner shall retain a copy of all filings so rejected. (Amended by Stats. 2015, Ch. 190, Sec. 42. (AB 1517) Effective January 1, 2016.)
  61. 18406.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Reports and Financial Statements [18405 - 18412] ( Article 3 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    Industrial loan companies with outstanding investment certificates must display and provide key financial statements, and any person may inspect the statement during business hours on request.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Reports and Financial Statements [18405 - 18412] ( Article 3 added by Stats. 1976, Ch. 964. ) ## 18406. Each industrial loan company which has issued and which has outstanding investment certificates shall: (a) Post in a conspicuous and prominent place in each business location a condensed statement of its financial condition, and (b) Furnish to a person prior to such person’s investment in an investment certificate a copy of its latest condensed statement of its financial condition. Each year a copy of the condensed statement shall be furnished by mail or hand-delivered to each investment certificate holder. (c) Maintain and have available for public inspection a copy of its latest audited financial statement required by subdivision (a) of Section 18405 in each of its business locations. Any person shall, upon request, be permitted to inspect the statement during regular business hours. (d) The statement required by subdivisions (a) and (b) shall set forth such information and be in such form as may be required by the commissioner. (Repealed and added by Stats. 1976, Ch. 964.)
  62. 18407.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Reports and Financial Statements [18405 - 18412] ( Article 3 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    An industrial loan company must submit unaudited financial statements to the commissioner when requested, using GAAP and including at least a balance sheet and statement of income.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Reports and Financial Statements [18405 - 18412] ( Article 3 added by Stats. 1976, Ch. 964. ) ## 18407. An industrial loan company 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 a statement of income as of the date and for the period specified by the commissioner. The commissioner may require the submission of such reports on a monthly or other periodic basis. (Repealed and added by Stats. 1976, Ch. 964.)
  63. 18408.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Reports and Financial Statements [18405 - 18412] ( Article 3 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    An industrial loan company must make special reports to the commissioner when the commissioner requires them.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Reports and Financial Statements [18405 - 18412] ( Article 3 added by Stats. 1976, Ch. 964. ) ## 18408. An industrial loan company shall make other special reports to the commissioner as the commissioner may from time to time require. (Repealed and added by Stats. 1976, Ch. 964.)
  64. 18409.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Reports and Financial Statements [18405 - 18412] ( Article 3 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    The commissioner must annually file with the department a public record combining reports from industrial loan companies and any public-interest comments.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Reports and Financial Statements [18405 - 18412] ( Article 3 added by Stats. 1976, Ch. 964. ) ## 18409. The commissioner shall make and file annually with the department as a public record a composite of reports filed by industrial loan companies, and any comments thereon that he or she deems in the public interest. (Amended by Stats. 1996, Ch. 1064, Sec. 596. Effective January 1, 1997. Operative July 1, 1997.)
  65. 18410.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Reports and Financial Statements [18405 - 18412] ( Article 3 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    An industrial loan company must provide the commissioner with reasonably required statistical information for the composite report.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Reports and Financial Statements [18405 - 18412] ( Article 3 added by Stats. 1976, Ch. 964. ) ## 18410. For the purposes of the composite report provided for by Section 18409, an industrial loan company shall furnish statistical information as is reasonably required by the commissioner, including information for each place of business of the company and as to any parent, subsidiary or affiliated company. (Repealed and added by Stats. 1976, Ch. 964.)
  66. 18411.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Reports and Financial Statements [18405 - 18412] ( Article 3 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    The commissioner may set the form and contents of required financial statements, reports, certificates, and opinions, and may require those reports and statements to be verified.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Reports and Financial Statements [18405 - 18412] ( Article 3 added by Stats. 1976, Ch. 964. ) ## 18411. The commissioner may by rule or regulation specify the form and contents of the financial statements, reports, certificates and opinions required to be filed pursuant to this article, and may require that such reports and financial statements be verified in such manner as he may prescribe. (Repealed and added by Stats. 1976, Ch. 964.)
  67. 18412.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Reports and Financial Statements [18405 - 18412] ( Article 3 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    Required reports must be filed with the commissioner when the commissioner requires, and late or incomplete reports trigger a $100-per-day penalty.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Reports and Financial Statements [18405 - 18412] ( Article 3 added by Stats. 1976, Ch. 964. ) ## 18412. Each report required under this article shall be filed with the commissioner at the time that the commissioner by regulation or order may require. If any industrial loan company fails to make any report required by this article at the time specified by the commissioner, or fails to include in that report any matter required by this article or by the commissioner, the commissioner shall assess and collect a penalty of one hundred dollars ($100) for each day which that report is delayed or withheld by the failure or neglect of that industrial loan company. (Added by Stats. 1990, Ch. 679, Sec. 1.)
  68. 18415.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    The commissioner may take possession of an industrial loan company’s property and business if listed grounds exist.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18415. The commissioner may take possession of the property and business of any industrial loan company and retain possession until the company resumes business or its affairs are liquidated if any of the following grounds exist: (a) The capital of an industrial loan company is impaired. (b) An industrial loan company has violated its articles of incorporation or any law of this state. (c) An industrial loan company is conducting its business in an unsafe or unauthorized manner. (d) An industrial loan company refuses to submit its books, papers and affairs to the inspection of any examiner. (e) An officer of any industrial loan company refuses to be examined upon oath touching the concerns of such industrial loan company. (f) An industrial loan company has suspended payment of its obligations. (g) An industrial loan company is in such condition that it is unsound or unsafe for it to transact business. (h) An industrial loan company neglects or refuses to observe any order of the commissioner made pursuant to this division, unless the enforcement of that order is restrained in a proceeding brought by the industrial loan company. (i) An industrial loan company (1) fails to become and continue as either a member of the Federal Deposit Insurance Corporation or a member of the Thrift Guaranty Corporation of California in accordance with Chapter 7 (commencing with Section 18475), (2) has its right to participate in the Thrift Guaranty Corporation of California suspended or revoked pursuant to subdivision (a) of Section 18496 and it is not a member of the Federal Deposit Insurance Corporation, or (3) fails to pay any assessment levied pursuant thereto within the time specified. (j) A member industrial loan company of Guaranty Corporation refuses to permit Guaranty Corporation, its appointed certified public accountant or public accountant, or specialized committees or employees to fulfill their duties under Section 18496. (k) An industrial loan company has sold or issued investment certificates in violation of the provisions of this division. (l) An industrial loan company has failed to maintain in effect a bond required under the provisions of this division. (m) Any fact or condition exists which, if it had existed at the time of the original application for authority to organize and establish a corporation to engage in the industrial loan business reasonably would have warranted the commissioner in disapproving the application. (n) An application for membership in the Federal Deposit Insurance Corporation has not been filed with and accepted by the Federal Deposit Insurance Corporation on or before January 15, 1990. If the commissioner takes possession of the business and property of an industrial loan company, the company, with the consent of the commissioner, may resume business upon prescribed conditions. (Amended by Stats. 1989, Ch. 583, Sec. 2.5.)
  69. 18415.1.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    After the commissioner takes possession of an industrial loan company’s property and business, the company may ask the superior court to stop further proceedings within 10 days if it claims to be aggrieved.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18415.1. Whenever the commissioner has taken possession of the property and business of an industrial loan company, that industrial loan company, within 10 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 the industrial loan company is located to enjoin further proceedings. The commissioner may exercise all powers granted by this article during the 10-day period after taking possession of the property and business of the industrial loan company. 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 the industrial loan company, or make such further order as may be just. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  70. 18415.10.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    The commissioner may, at any time, examine under oath certain company personnel to check whether all property and assets have been transferred to the commissioner’s possession.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18415.10. The commissioner may, at any time, examine under oath any officer, director, agent, employee or stockholder of a company to determine whether or not all property and assets have been transferred or delivered to the commissioner’s possession. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  71. 18415.11.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    When the commissioner takes possession of a company’s property and business, the commissioner must collect money due and take necessary or expedient steps to conserve or protect assets, property, and business, and must proceed to conserve or liquidate the company’s affairs under the chapter.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18415.11. Upon taking possession of the property and business of any company, the commissioner has authority and the duty to collect all moneys due to the company and to do such other acts as are necessary or expedient to collect, conserve, or protect its assets, property and business. The commissioner shall also proceed to conserve or liquidate the affairs thereof as provided in this chapter. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  72. 18415.12.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    The commissioner may ask the court for an injunction, and the court must issue orders needed to stop specified harmful actions.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18415.12. The commissioner may file a petition with the court and the court shall issue such injunctions or orders, as may be deemed necessary, to prevent any of the following occurrences: (a) Interference with the commissioner or the proceeding. (b) The institution of any actions or proceedings, or the prosecution of any actions or proceedings already commenced. (c) Waste of assets of the entity. (d) The obtaining of preferences, judgments, attachments or other liens against the company or its assets. (e) The making of any levy against the company or its assets. (f) The sale or deed for nonpayment of taxes or assessments levied by any taxing agency of any of the following: (1) Property owned by the company. (2) Property upon which the company holds an encumbrance. (3) Property upon which the company has prior thereto commenced an action to foreclose any deed of trust or mortgage or has exercised the power of sale under any trust deed or mortgage which sale or foreclosure proceedings have not yet been completed or upon which no trustee’s deed or judgment of court or sheriff’s certificate of sale has been issued. “Taxing agency,” as used in this section, has the same meaning as defined in Section 121 of the Revenue and Taxation Code. The injunctions or orders authorized by this subdivision may be modified, dissolved, or rescinded by the court on motion of the commissioner, the Controller, or the person charged with the collection of taxes or assessments on such property. The recording in the office of the county recorder of any county in the state of an order or injunction issued pursuant to this section, shall constitute service of the order or injunction upon any taxing agency with respect to property or interest therein located in such county. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  73. 18415.13.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    After taking possession of a company’s property and business, the commissioner may terminate or adopt the company’s executory contracts, including leases, but must do so within six months of learning about the contract or lease.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18415.13. After the taking of possession of the property and business of any company, the commissioner may terminate or adopt any executory contract to which the company may be a party, including leases of real or personal property. The termination or adoption shall be made within six months after obtaining knowledge of the existence of the contract or lease. Any provision in the contract or lease which provides for damages or cancellation fees upon termination shall not be binding on the commissioner or the company seized. The commissioner and the company shall only be liable for actual damages and in no event in excess of one thousand dollars ($1,000). Any claim must be filed within 30 days of the date of the termination. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  74. 18415.14.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    The commissioner may take action against a debtor or alleged debtor using summary procedure or by asking the court for an order to show cause.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18415.14. The commissioner may proceed against any debtor or alleged debtor by way of summary procedure or by order to show cause issued by the court upon application by the commissioner. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  75. 18415.15.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    The commissioner may examine the seized company and review what any conservator or liquidator is doing.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18415.15. The commissioner may make examinations of the seized company and review the activities of any conservator or liquidator. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  76. 18415.16.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    The company must pay the actual cost of examinations, investigations, or services, as fixed by the commissioner, from its assets.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18415.16. The actual cost of any examination, investigation or services, including the actual amount of salary or other compensation paid to the persons making the examination, investigation or rendering services and the overhead costs in connection therewith, as fixed by the commissioner, shall be paid out of the assets of the company. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  77. 18415.17.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    If the commissioner files written notice to liquidate a company with the court, certain recent actions are stayed or dissolved, and no new attachment, execution, or lien may be created during liquidation.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18415.17. The determination by the commissioner to liquidate a company, evidenced by filing written notice of the determination with the court, operates to stay or dissolve all actions or attachments instituted or levied within 90 days next preceding the taking of possession of the company by the commissioner, and pending the process of liquidation, no attachment or execution shall be levied or lien created upon any of the property of the company. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  78. 18415.18.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    When the commissioner takes possession of a company’s property and business in a proceeding, the commissioner may appoint special deputy commissioners, hire legal counsel, set a special deputy commissioner’s pay, and require security from deputies and assistants.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18415.18. Upon taking possession of the property, and business of a company in any proceeding under this article, the commissioner shall have the power to do all of the following: (a) Appoint one or more special deputy commissioners as his or her agent or agents with the powers specified in the certificate of appointment to assist in the duty of conservation or of liquidation and distribution. (b) Employ the Attorney General as counsel or employ private counsel as may be deemed necessary to assist the commissioner in the performance of his or her duties under this chapter. Appointment of private counsel shall be made only with the consent of the Attorney General. The compensation of that counsel shall be fixed by the commissioner, subject to the approval of the court. (c) Set the compensation of a special deputy commissioner. (d) Require from each special deputy commissioner and from each assistant such security for the faithful performance of their duties as the commissioner may deem proper. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  79. 18415.19.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    A company covered by this article must pay the costs of possession, conservatorship, liquidation, and related dealings out of its assets.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18415.19. All expenses of taking possession of, conserving, conducting, liquidating, disposing of or otherwise dealing with the business and property of any company under this article shall be paid out of the assets of that company. Those expenses shall include, among other things, the compensation of special deputy commissioners, clerks and assistants and the actual cost of any services attributable to the conservatorship or liquidation performed by the commissioner and staff, including the actual amount of salary or compensation paid to the person performing the services and overhead costs in connection therewith as fixed by the commissioner. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  80. 18415.2.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    The commissioner or the industrial loan company may appeal the court’s judgment as provided by law.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18415.2. An appeal may be taken from the judgment of the court by the commissioner or by the industrial loan company in the manner provided by law for appeals from the judgment of a superior court to the court of appeal. (Amended by Stats. 1998, Ch. 931, Sec. 149. Effective September 28, 1998.)
  81. 18415.21.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    A conservator or liquidator may void certain transactions made within six months before possession was taken if they give a preference to specified insiders or creditors.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18415.21. Any transaction occurring within six months of the date of taking possession shall be voidable by the conservator or liquidator if the transaction has the effect of giving to, or enabling any creditor of, the company, any affiliate of the company, any officer, director, stockholder, employee or any relative thereof, to obtain a preference over any other creditor of the company. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  82. 18415.22.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    After possession is taken, the company may not buy or discount obligations under these agreements, and related reserves or security cannot be used to offset those obligations.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18415.22. No obligation may be purchased or discounted under any agreement between the company and any person involving the purchase or discount of obligation from the person, with or without recourse, from the moment of taking possession pursuant to Section 18415. Any guarantees, recourse or repurchase agreements given at the time of purchase, or discount of any obligation prior to the date of taking possession, shall continue to be binding on the person. Any reserves, withholds or other security held by the company under the terms of the agreement shall be considered liabilities of the company in the general creditor classification and may not be used as offset against any obligation purchased or discounted under the agreement. No distribution of assets shall be made on these liabilities until the obligations purchased or discounted under the agreement have been satisfied. In case of sale of the obligations by the liquidator, the reserves, withholds or other security shall remain as a liability to be paid off in the normal course of liquidation. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  83. 18415.23.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    Attachment or execution may not be issued against a company's property before final judgment.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18415.23. No attachment or execution shall be issued against the property of any company before final judgment in any action or proceeding in any court. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  84. 18415.3.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    An industrial loan company must cure a net-worth deficiency if its net worth falls below the stated 90% threshold, and the commissioner may or must take possession if the deficiency is not cured within the allowed time.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18415.3. (a) Whenever the net worth of an industrial loan company, exclusive of its good will, is less than 90 percent of the aggregate sum of its outstanding investment certificates, exclusive of those hypothecated with the company issuing them, divided by the fraction that is its investment certificates ratio permitted by the commissioner, the commissioner shall by written order direct the company to make good the alleged deficiency of net worth. Pursuant to the commissioner’s orders, the company’s net worth shall be at least 100 percent of the aggregate sum of its outstanding investment certificates, exclusive of those hypothecated with the company issuing them, divided by the fraction that is its investment certificates ratio permitted by the commissioner. (b) If the company fails to cure the alleged deficiency of net worth within the commissioner’s specified time, not to exceed 120 days, the commissioner may take possession of the company’s property and business. If the alleged deficiency is not cured within 120 days of the order, the commissioner shall take possession of the company’s property and business. (Amended by Stats. 2006, Ch. 538, Sec. 174. Effective January 1, 2007.)
  85. 18415.4.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    The commissioner may, if the company’s board of directors requests it, take possession of the company’s property and business and, as conservator, take whatever action the commissioner considers proper.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18415.4. The commissioner may also, upon the request of the board of directors of a company, take possession of the property and business of a company and as conservator, take such action as the commissioner deems proper. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  86. 18415.5.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    When the commissioner takes possession of an industrial loan company’s property and business, the commissioner must notify persons holding its assets. A notified person, or a person who knows of the taking, may not place a lien or charge on the company’s assets for later payments, advances, clearances, or liabilities.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18415.5. Upon taking possession of the property and business of any industrial loan company, the commissioner shall give notice of that fact to all persons holding or having in their possession any assets of the company. The notice required by this section shall not be deemed to be a prerequisite to the taking of possession of the property and business of the industrial loan company. No person knowing of the taking, or who has been notified thereof, shall have a lien or charge upon any assets of the company for any payment, advance or clearance thereafter made, or for any liability thereafter incurred. Notice is deemed given when the commissioner has either made personal service of the notice, or mailed the notice to the person by certified mail. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  87. 18415.6.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    Certain company officers, agents, employees, directors, or stockholders who refuse to comply with a possession demand under Section 18415 commit a misdemeanor and may be fined or jailed.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18415.6. Any officer, agent, employee, director, or stockholder of a company who refuses to comply with the demand for possession issued under Section 18415 shall be guilty of a misdemeanor punishable by a fine of not more than one thousand dollars ($1,000) or imprisonment not exceeding one year or by both such fine and imprisonment. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  88. 18415.7.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    When the commissioner asks, county sheriffs and municipal police departments must provide deputies, patrolmen, or officers needed to help the commissioner carry out seizures under Section 18415.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18415.7. On demand of the commissioner, it shall be the duty of the sheriff of any county of the state, and of the police department of any municipal corporation therein, to furnish the commissioner with deputies, patrolmen, or officers as may be necessary to assist the commissioner in making and enforcing any seizure under Section 18415. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  89. 18415.8.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    After taking possession of a company’s property and business, the superior court for the county where the company’s head office is located has exclusive original jurisdiction over related proceedings. Certain possession papers must be filed and made part of the record within 45 days, and no extra filing fees may be charged for papers filed with the court.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18415.8. Upon taking possession of the property and business of any company, the superior court for the county in which the head office of the company is located shall have exclusive original jurisdiction of all proceedings relating thereto and of any action or other proceedings brought under the provisions of this chapter. All papers relating to the taking of possession, including copies of the certificate of appointment of any special deputy, shall be filed and be made a part of the record of the proceeding within 45 days of the date of taking possession. All papers filed with the superior court, including inventories required to be filed, shall be made a part of the record of the proceeding without the payment of any additional fees therefor. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  90. 18415.9.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    After a possession order has been filed with the court, the commissioner may move the principal office to San Francisco or Los Angeles, and the court must then direct transfer of the filed papers if the commissioner applies.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18415.9. At any time after the order taking possession issued under Section 18415 has been filed with the court, the commissioner may remove the principal office of the person proceeded against to the City and County of San Francisco or to the City of Los Angeles. In the event of removal, the court where the proceeding was commenced shall, upon the application of the commissioner, direct the superior court clerk to transmit all of the papers filed therein with that clerk to the Superior Court Clerk of the City and County of San Francisco or of the County of Los Angeles as the case may require. The proceeding shall thereafter be conducted in the same manner as though it had been commenced in the county to which it had been transferred. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  91. 18420.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    If the commissioner takes possession of a company as conservator or liquidator, the commissioner may exercise broad authority to collect debts, use the company’s rights and powers, and handle legal proceedings and other related acts.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18420. The commissioner, as conservator or liquidator, after taking possession of the company, shall, in his or her name, in the name of the company, in the name of both, or otherwise, have authority to do all of the following: (a) Collect all obligations and money due the company. (b) Exercise and possess all the rights, powers and privileges of the company, its officers and directors. (c) Institute, prosecute, maintain, defend, intervene, and otherwise participate in any and all actions, suits, or other legal proceedings by and against the conservator or liquidator or company, or in which the conservator, the company or its creditors or debtors, or any of them, have an interest, and in every way to represent the company, its creditors, and debtors. (d) Execute, acknowledge, and deliver any and all deeds, contracts, leases, assignments, bills of sale, releases, extensions, satisfactions, and other instruments necessary or proper for any purposes. (e) Be the custodian of all moneys collected by the commissioner or coming into his or her possession in the course of any proceeding under this chapter, but he or she may deposit those moneys, or any part thereof, in a bank insured by the Federal Deposit Insurance Corporation. (f) Invest or reinvest such portions of funds and assets of the company, in a manner as he or she may deem suitable for the best interests of the creditors of the company. (g) To revise, refinance, extend, or settle any loan or obligation upon those terms and conditions as he or she may deem to be most advantageous to the company. (h) To sell, compound, compromise or assign for the purpose of collection upon those terms and conditions he or she deems best, any bad or doubtful debts due the company. (i) To compound, compromise, or in any manner negotiate settlements of claims against the company upon those terms and conditions as he or she shall deem to be most advantageous to the company. (j) To sell, acquire, hypothecate, encumber, lease, improve, abandon, or otherwise dispose of or deal with any real or personal property which has come into ownership of the company by way of repossession, foreclosure, execution, suit or by other such means on a basis of reasonable market value, without notice, for cash, on terms, or upon such other terms and conditions as he or she may deem proper. (k) To settle, compromise, or obtain the release of, for cash or other consideration, claims and demands against the company or the conservator. (l) To sell for cash or on terms, exchange, or otherwise dispose of, in whole or in part, any or all the assets and property of the company, real, personal, and mixed, tangible and intangible, of any nature. (m) Execute, acknowledge, and deliver any and all deeds, contracts, leases, assignments, bills of sale, releases, extensions, satisfactions, and any other instruments necessary or proper for any purposes, including, but not limited to, the effectuation, termination, or modification of any sale, lease, or transfer of real, personal, or mixed property, or that shall be necessary or proper to liquidate or carry on the business of the company. Any deed or other instrument executed pursuant to the authority hereby given shall be as valid and effectual for all purposes as if it had been executed as the act and deed of the company. (n) Pay out and expend such sums as the commissioner deems necessary or advisable including the following: (1) To pay off or discharge any taxes, assessments, liens, claims, or charges of any nature against the company, the conservator or liquidator, any asset or property of any nature of the company, or upon any asset or property on which the company or conservator or liquidator has an interest of a value of any nature. (2) For or in connection with the preservation, maintenance, conservation, protection, remodeling, repair, rehabilitation, or improvement of any asset or property of any nature of the company. (3) To pay all costs and expenses of the conservatorship or liquidation and all costs of carrying out or exercising the commissioner’s rights, powers, privileges, and duties as conservator. (4) To pay valid creditor obligations, interest owed on debts, debts incurred during conservatorship or liquidation and all other debts of the company or conservatorship or liquidation of any nature. (5) To pay all costs and expenses in the operation of the conservatorship or liquidation of the company. (o) Do such things, and have such rights, powers, privileges, immunities and duties, whether or not otherwise granted in this chapter, as shall be authorized, directed, conferred, or imposed from time to time in specific cases by order of the court. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  92. 18420.1.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    Certain transactions need court permission first if the stated dollar thresholds are exceeded.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18420.1. No transaction involving real or personal property, investment or reinvestment of funds or assets, or settlement or compromise of pending lawsuits shall be made without first obtaining permission of the court, and then only in accordance with such terms as the court may prescribe, when either of the following exist: (a) The principal sum of any obligation due the company or settlement or compromise of a pending lawsuit exceeds the sum of fifteen thousand dollars ($15,000). (b) The market value of any real or personal property, except obligations due the company, exceeds the sum of ten thousand dollars ($10,000). (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  93. 18420.2.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    The commissioner may, with ex parte court approval, sell company assets and may also borrow money from specified institutions to help transfer investment certificate liabilities, using company assets as security.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18420.2. The commissioner may, with ex parte approval of the court, sell all or any part of the company’s assets to another industrial loan company, to a bank, to a savings and loan association, to Guaranty Corporation, or to an instrumentality of the United States government. In like manner, the commissioner may borrow from Guaranty Corporation, an instrumentality of the United States government, or a private insurer which insures or guarantees the company’s investment certificates, any amount necessary to facilitate the assumption of investment certificate liabilities by a newly chartered or existing industrial loan company, assigning any part or all of the assets of the company as security for that loan. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  94. 18420.5.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    The commissioner may appoint a conservator or liquidator for the company, and that appointee gets the same powers, rights, duties, and obligations as the commissioner while in possession.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18420.5. The commissioner may appoint a person to act as conservator or liquidator of the company. The person appointed may be Thrift Guaranty Corporation of California. If the company’s outstanding thrift obligations are insured by an instrumentality of the United States government, the commissioner may appoint that instrumentality to act as conservator or liquidator of the company. Subject to the other provisions of this division, a conservator or liquidator, while in possession of the property and business of a company, has the same powers and rights and is subject to the same duties and obligations as the commissioner while in possession of the property and business of a company. During such time, the rights of the company and of all persons with respect thereto, subject to the other provisions of this chapter, are the same as if the commissioner had taken possession of such properties and business, except that the commissioner may limit those powers and rights as he or she may deem necessary. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  95. 18420.6.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    The commissioner may terminate a conservator or liquidator appointment if doing so is in the best interest of the company, its creditors, and investors, and must file the termination notice with the court.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18420.6. The commissioner shall have the authority to terminate the appointment of a conservator or liquidator whenever the commissioner deems it in the best interest of the company, its creditors, and investors. The commissioner shall file a copy of the notice of termination with the court. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  96. 18420.7.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    The commissioner may require a conservator or liquidator to post a bond, and the commissioner sets the salary for a conservator or liquidator within a stated cap.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18420.7. The commissioner may require a conservator or liquidator to provide such bond as the commissioner deems proper. The conservator or liquidator shall receive a salary, fixed by the commissioner, in an amount no greater than that which would be paid by the commissioner to a special deputy commissioner in charge of the liquidation of the company. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  97. 18425.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    If the commissioner has already taken possession and thinks conservatorship would be futile, the commissioner may order the company liquidated.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18425. If at any time after taking possession of the property and business of a company it shall appear to the commissioner that it would be futile to proceed as conservator with the conduct of the business of the company, the commissioner may order the company to be liquidated. A copy of the liquidation order shall be filed with the clerk of the superior court. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  98. 18425.1.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    The liquidator must notify claimants by publication and by mail, and claimants must file and prove their claims within the stated time.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18425.1. The liquidator shall cause notice to be given by publication for four successive weeks in a newspaper of general circulation at or near the principal place of business in the state of the company, to all persons having claims against the company, other than investment certificate holders, whether or not an action is pending to enforce any claim for demand, requiring them to present and file their claims and make legal proof thereof at a place and within a time designated in the notice. The time shall not be less than 90 days after the first publication of the notice. The notice shall also state that all claims other than those of investment certificate holders appearing upon the books or records of the company and any claims, whether or not an action is pending to enforce any such claim or demand, shall be forever barred if not filed within the time designated. The liquidator shall also mail a similar notice to all persons whose names appear as creditors upon the books of the company and any person who has an action pending to enforce a claim or demand whose address appears upon the books or records of the company and shall enclose therewith a printed form or notice of claim. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  99. 18425.10.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    In a commissioner-administered liquidation proceeding, claims are paid in a set priority order, approved claims earn interest if funds are available, and any leftover funds go to stockholders.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18425.10. (a) Claims allowed in a proceeding under this article shall be given preference in the following order: (1) All costs and expenses of administration of conservatorship and liquidation. (2) Taxes due to the State of California. (3) Claims having preference by the laws of the United States and by laws of this state. (4) All claims of creditors, including contractual claims for interest to the date of payment, whose claims are fully secured. (5) Claims of investment certificate holders. (6) Claims of general creditors. (7) Claims on obligations subordinated to the claims of investment certificate holders and general creditors. Paragraphs (5) and (6) apply only in liquidation proceedings, where the commissioner has taken possession of the property and business of the company on or after the effective date of this section, and paragraph (6) shall apply only with respect to persons who become general creditors on or after that date. It is the intent of the Legislature that no change in the law contained in this section shall be construed to affect the rights and obligations of parties with regard to transactions occurring prior to the effective date of this section. It is the intent of the Legislature that the rights and obligations of parties existing prior to the effective date of this section shall be determined by the law in effect prior to the effective date of this section and without application of changes in the law effected by this section. (b) All approved claims shall bear interest at the rate provided by law or judgments from the date that the commissioner takes possession of the property and business of the company, to the extent funds are available to pay such interest, otherwise interest shall be prorated. Interest shall be given the same preference as the claim on which it is based, but no interest on any claim shall be paid until all claims within the same class have received the full principal amount of the claim. (c) Any funds remaining shall be returned to the stockholders of the company pursuant to the provisions of this article. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  100. 18425.11.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    If the commissioner decides to liquidate a company, the commissioner must make a duplicate inventory of all company assets and file the original with the court and the duplicate in the commissioner’s office.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18425.11. Whenever the commissioner determines to liquidate a company, the commissioner shall cause an inventory of all the assets of the company to be made in duplicate, file the original with the court, and file the duplicate in the commissioner’s office. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  101. 18425.12.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    If a company’s property is unlikely to yield anything and keeping it would likely waste money, the court may order the liquidator to abandon it.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18425.12. If it appears improbable that anything can be realized from any property of the company and that the cost of maintaining, preserving, or protecting the property would probably be lost, the court may direct the liquidator to abandon the property. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  102. 18425.13.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    The superior court may decide that a lawsuit on a company’s debt or claim does not need to be brought if a purchaser cannot be found and recovery appears unlikely.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18425.13. If a purchaser of any property or any bad or doubtful debt or claim of a company cannot be obtained and it appears improbable that recovery thereon can be had, and that the cost of action to enforce collection of the same would probably be lost, the superior court may direct that suit on the debt or claim need not be brought. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  103. 18425.14.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    After liquidation requirements are met, the liquidator may seek an order to liquidate a domestic corporation, and the commissioner may apply for an order dissolving it.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18425.14. When the liquidator has fully liquidated all claims other than claims of stockholders, made due provision for any and all known but unclaimed liabilities, excepting claims of stockholders, and paid all expenses of liquidation, the liquidator may file an application for an order for the liquidation of a domestic corporation, or at any time thereafter, the commissioner may apply for, and the court shall make, an order dissolving the corporation. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  104. 18425.15.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    After a final dividend is paid in liquidation, the commissioner must file a full and final liquidation statement with the court and also file a duplicate in the commissioner’s office. The liquidation closes only after the court hears and approves it.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18425.15. Upon the payment of a final dividend in liquidation, the commissioner shall prepare and file with the court a full and final statement of the liquidation, including a summary of the receipts and disbursements, and a duplicate of the statement shall be filed in the office of the commissioner. After hearing and approval by the court, the liquidation shall be closed. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  105. 18425.16.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    When approving the commissioner’s final liquidation statement, the court must determine unpaid or unclaimed liquidating dividends and direct the commissioner to deposit them with the Treasurer.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18425.16. In making its order approving the commissioner’s final statement of the liquidation of the company, the court shall determine the amounts of the liquidating dividends to which claimants are entitled but which then remain unpaid or unclaimed in the hands of the commissioner. The order of the court shall direct the commissioner to deposit those amounts with the Treasurer. All amounts so deposited shall be deemed to be deposited in the State Treasury under the provisions of Chapter 7 (commencing with Section 1500) of Title 10 of Part 3 of the Code of Civil Procedure, and shall be subject to claim or disposition as provided in that chapter. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  106. 18425.17.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    After a liquidation order is approved, the court must provide for disposal of the company’s books and records, may declare the company dissolved, and the liquidator must file the dissolution order with the Secretary of State.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18425.17. The order of the court approving the final statement on liquidation shall provide for the destruction or other disposition of the books and records of the company or pertaining to the liquidation of the company, and the court may declare the company dissolved as a corporation. The liquidator shall file a copy of the order of dissolution with the Secretary of State. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  107. 18425.2.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    Claims against covered property must be presented to the liquidator in writing and verified within the notice period.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18425.2. All claims, demands, or causes of action of creditors, and persons other than investors against any property owned or held by it in trust, or otherwise, must be presented to the liquidator in writing, verified by the claimant, or someone on his or her behalf, within the period specified in the notice for the presentation of claims, whether or not an action is pending to enforce any such claim or demand. The liquidator shall not approve any claim not so presented, and any such claim, demand, or cause of action not so presented is forever barred. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  108. 18425.3.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    The liquidator may reject a doubtful claim and give notice of rejection; a challenge to the rejected claim must be filed within 30 days, or it is forever barred.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18425.3. If the liquidator doubts the validity of any claim, the liquidator may reject the claim and serve notice of rejection upon the claimant either by certified mail or personally. A notice of rejection given by mail, addressed to the claimant at the address set forth in the claim, shall constitute sufficient notice of the rejection. Any action upon a claim so rejected must be brought within 30 days after the mailing of the notice or personal service of the notice in the court in which the liquidation proceeding is pending for an order to show cause why the claim should not be allowed. Failure to bring such action within 30 days to enforce the payment of or establish any rejected claim shall forever bar any such action. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  109. 18425.4.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    A claimant must file a claim under oath on the commissioner’s form and include specified details about the claim.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18425.4. A claim shall set forth, under oath, on the form prescribed by the commissioner, all of the following: (a) The particulars of the claim, and the consideration for the claim. (b) Whether the claim is secured or unsecured, and, if secured, the nature and amount of the security. (c) The payments, if any, made thereon. (d) That the sum claimed is justly owing from such person to the claimant. (e) That there is no offset to the claim. (f) Such other data or supporting documents as the liquidator requires. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  110. 18425.5.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    If an investment certificate holder is also a debtor, the liquidator may set off amounts owed against that person’s debt and related interest, subject to a cap.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18425.5. When an investment certificate holder is also a debtor, the liquidator may offset any balance due the investment certificate holder against the debt and the interest due on that debt up to the date of offset, in an amount not to exceed the amount of the debt or the amount of the thrift obligation guaranteed by the Thrift Guaranty Corporation of California, whichever is less. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  111. 18425.6.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    A liquidator must notify each investment certificate holder of the claim amount, and the holder usually does not need to file a claim unless they dispute that amount.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18425.6. The amount of a claim of an investment certificate holder shall be the amount which the investment certificate holder would have been entitled to withdraw as of the date of taking possession, pursuant to Section 18415, plus interest thereon accrued to that date, without regard to whether the account is subject to any pledge. In the case of an account with a fixed or minimum term or a qualifying or notice period that has not expired as of the date of taking possession, interest shall be computed as if the account had been withdrawn on that date without penalty or reduction in interest. The liquidator shall give notice to each investment certificate holder of the amount of his or her claim and the investment certificate holder shall not be required to file a claim unless he or she disputes the amount of the liquidator’s determination. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  112. 18425.7.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    The liquidator must prepare and file claim lists, including rejected claims, and keep those lists open for inspection.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18425.7. When the time fixed for the presentation of claims has expired, the liquidator shall make in duplicate a full and complete list of all claims presented, including and specifying those claims that have been rejected by the liquidator, and a list of all claims of investment certificate holders as shown by the books or records of the company, and shall file one copy of the list in the commissioner’s office and one with the clerk of the superior court in which the liquidation proceedings are being held. Before each application to the court for leave to declare a dividend, the liquidator shall file a supplemental list of claims presented since the last preceding list was filed, including and specifying the claims as have been rejected by the liquidator. The list of claims and of claims of investment certificate holders as shown by the books or records of the company shall be open for inspection at all reasonable times. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  113. 18425.8.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    People interested in a claim may file written objections, and the liquidator must pass them to the court.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18425.8. Objections to any claim not rejected by the liquidator may be made by any person interested by filing his or her objections, in writing, with the liquidator, who shall present the objections to the court. The court shall dispose of the objections or may order reference for that purpose, and should the objections to any claim be sustained by the court or by the referee, that claim shall not be allowed by the liquidator until the claimant has established his or her claim by judgment. Any objections to a claim shall be filed within 60 days from the date of filing of the schedule of claims as required by this article with the court or be forever barred. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  114. 18425.9.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. )

    Verify source ↗

    The liquidator may pay dividends and a final distribution only with court approval and subject to the timing and fund-set-aside rules in this section.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner [18415 - 18425.17] ( Article 4 added by Stats. 1985, Ch. 140, Sec. 1. ) ## 18425.9. The liquidator, with the approval of the court, may pay one or more dividends to investment certificate holders prior to the expiration of the time for filing claims. After the time for filing of claims has elapsed, the liquidator, after obtaining approval of the court, may pay one or more dividends upon all approved claims out of the funds remaining in the liquidator’s possession after the payment of expenses and after setting aside an amount to pay creditors whose claims have been rejected and whose time for filing an application to show cause under this article has not yet elapsed or whose application is still pending. At any time after the expiration of one year from the date of the first publication of notice of creditors, and with court approval, the liquidator may pay a final distribution which shall consist of the remaining funds available for distribution, being distributed pro rata to all approved creditor claims. (Added by Stats. 1985, Ch. 140, Sec. 1. Effective July 1, 1985.)
  115. 18427.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Securities Transactions [18427 - 18427.11] ( Article 5 added by Stats. 1989, Ch. 663, Sec. 17. )

    Verify source ↗

    This section defines “offer,” “sale,” and “security” for this article, and it excludes certain stock dividends from the definitions of offer and sale.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Securities Transactions [18427 - 18427.11] ( Article 5 added by Stats. 1989, Ch. 663, Sec. 17. ) ## 18427. Unless the context otherwise requires, in this article: (a) “Offer” or “offer to sell” includes every attempt or offer to dispose of, or solicitation of an offer to buy, a security for value. (b) “Sale” or “sell” includes every contract of sale of, contract to sell, or disposition of, a security for value. “Sale” or “sell” includes any exchange of securities and any change in the rights, preferences, privileges, or restrictions of or on outstanding securities. (c) “Security” means any stock or debenture, or any warrant, right, or option to subscribe to or purchase any of the foregoing. (d) The terms defined in subdivisions (a) and (b) of this section do not include any stock dividend payable with respect to common stock of an industrial loan company solely (except for any cash or script paid for fractional shares) in shares of such common stock, if such industrial loan company has no other class of voting stock outstanding; provided, that shares issued in any such dividend shall be subject to any conditions previously imposed by the commissioner applicable to the shares with respect to which they are issued. (Repealed and added by Stats. 1996, Ch. 1064, Sec. 598. Effective January 1, 1997. Operative July 1, 1997.)
  116. 18427.1.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Securities Transactions [18427 - 18427.11] ( Article 5 added by Stats. 1989, Ch. 663, Sec. 17. )

    Verify source ↗

    An industrial loan company in this state may not offer or sell its own securities unless the commissioner has issued a permit for that sale.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Securities Transactions [18427 - 18427.11] ( Article 5 added by Stats. 1989, Ch. 663, Sec. 17. ) ## 18427.1. No industrial loan company organized under the laws of this state shall offer or sell any security issued by it unless the commissioner has issued a permit authorizing such sale. (Repealed and added by Stats. 1996, Ch. 1064, Sec. 600. Effective January 1, 1997. Operative July 1, 1997.)
  117. 18427.10.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Securities Transactions [18427 - 18427.11] ( Article 5 added by Stats. 1989, Ch. 663, Sec. 17. )

    Verify source ↗

    This article does not change or affect the Corporate Securities Law of 1968.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Securities Transactions [18427 - 18427.11] ( Article 5 added by Stats. 1989, Ch. 663, Sec. 17. ) ## 18427.10. Nothing contained in this article shall affect the Corporate Securities Law of 1968, Division 1 (commencing with Section 25000) of Title 4 of the Corporations Code. (Added by Stats. 1996, Ch. 1064, Sec. 612. Effective January 1, 1997. Operative July 1, 1997.)
  118. 18427.11.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Securities Transactions [18427 - 18427.11] ( Article 5 added by Stats. 1989, Ch. 663, Sec. 17. )

    Verify source ↗

    The commissioner may use regulation or order to restrict, limit, prohibit, or condition certain securities-related uses and calculations.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Securities Transactions [18427 - 18427.11] ( Article 5 added by Stats. 1989, Ch. 663, Sec. 17. ) ## 18427.11. The commissioner may by regulation or order restrict, limit, prohibit or otherwise condition the uses of the proceeds from the sale of securities, the extent to which a security may be included within the definition of capital, or the extent to which the proceeds from the sale of securities may be included in the investment certificate ratio as defined by Section 18016, or used to increase outstanding investment certificates. (Added by Stats. 1996, Ch. 1064, Sec. 613. Effective January 1, 1997. Operative July 1, 1997.)
  119. 18427.2.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Securities Transactions [18427 - 18427.11] ( Article 5 added by Stats. 1989, Ch. 663, Sec. 17. )

    Verify source ↗

    A permit application must be in the form and include the information the commissioner requires.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Securities Transactions [18427 - 18427.11] ( Article 5 added by Stats. 1989, Ch. 663, Sec. 17. ) ## 18427.2. An application for a permit shall be in such form and contain such information as the commissioner may prescribe. (Repealed and added by Stats. 1996, Ch. 1064, Sec. 602. Effective January 1, 1997. Operative July 1, 1997.)
  120. 18427.3.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Securities Transactions [18427 - 18427.11] ( Article 5 added by Stats. 1989, Ch. 663, Sec. 17. )

    Verify source ↗

    The commissioner must charge and collect application fees set by this section.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Securities Transactions [18427 - 18427.11] ( Article 5 added by Stats. 1989, Ch. 663, Sec. 17. ) ## 18427.3. The commissioner shall charge and collect fees for applications filed under this article as fixed in this section. (a) The fee for a negotiating permit shall be fifty dollars ($50). (b) The fee for a permit to exchange a security or to make any change in the rights, preferences, privileges, or restrictions of or on outstanding securities shall be fifty dollars ($50). (c) The fee for any permit to sell securities other than as specified in subdivision (b) shall be one hundred dollars ($100) plus one-tenth of one percent of the aggregate value of the securities sought to be sold, up to a maximum aggregate fee of one thousand seven hundred fifty dollars ($1,750). (Repealed and added by Stats. 1996, Ch. 1064, Sec. 604. Effective January 1, 1997. Operative July 1, 1997.)
  121. 18427.4.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Securities Transactions [18427 - 18427.11] ( Article 5 added by Stats. 1989, Ch. 663, Sec. 17. )

    Verify source ↗

    If the commissioner finds a proposed securities sale fair, just, and equitable, the commissioner must issue the applicant a permit; otherwise, the application must be denied.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Securities Transactions [18427 - 18427.11] ( Article 5 added by Stats. 1989, Ch. 663, Sec. 17. ) ## 18427.4. If the commissioner finds that the proposed sale of securities is fair, just, and equitable, he or she shall issue to the applicant a permit authorizing it to offer and sell the securities in such amount and upon such terms and conditions as he or she may provide in the permit. If the commissioner finds otherwise, he or she shall deny the application. (Repealed and added by Stats. 1996, Ch. 1064, Sec. 606. Effective January 1, 1997. Operative July 1, 1997.)
  122. 18427.5.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Securities Transactions [18427 - 18427.11] ( Article 5 added by Stats. 1989, Ch. 663, Sec. 17. )

    Verify source ↗

    The commissioner may place conditions on permits issued under Section 18427.4.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Securities Transactions [18427 - 18427.11] ( Article 5 added by Stats. 1989, Ch. 663, Sec. 17. ) ## 18427.5. The commissioner may impose conditions in any permit issued under Section 18427.4, requiring the deposit in escrow of securities, imposing a legend condition restricting the transferability thereof, impounding the proceeds from the sale thereof, limiting the expense in connection with the sale thereof, or such other conditions as he or she deems reasonable and necessary or advisable in the public interest. (Added by Stats. 1996, Ch. 1064, Sec. 607. Effective January 1, 1997. Operative July 1, 1997.)
  123. 18427.6.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Securities Transactions [18427 - 18427.11] ( Article 5 added by Stats. 1989, Ch. 663, Sec. 17. )

    Verify source ↗

    A permit issued under Section 18427.4 must state that it is permissive only and is not a recommendation or endorsement of the securities that may be sold.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Securities Transactions [18427 - 18427.11] ( Article 5 added by Stats. 1989, Ch. 663, Sec. 17. ) ## 18427.6. Every permit issued pursuant to Section 18427.4 shall recite that it is permissive only and does not constitute a recommendation or endorsement of the securities permitted to be sold. (Added by Stats. 1996, Ch. 1064, Sec. 608. Effective January 1, 1997. Operative July 1, 1997.)
  124. 18427.7.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Securities Transactions [18427 - 18427.11] ( Article 5 added by Stats. 1989, Ch. 663, Sec. 17. )

    Verify source ↗

    The commissioner may amend, alter, suspend, or revoke any permit issued under Section 18427.4.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Securities Transactions [18427 - 18427.11] ( Article 5 added by Stats. 1989, Ch. 663, Sec. 17. ) ## 18427.7. The commissioner may amend, alter, suspend, or revoke any permit issued pursuant to Section 18427.4. (Added by Stats. 1996, Ch. 1064, Sec. 609. Effective January 1, 1997. Operative July 1, 1997.)
  125. 18427.8.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Securities Transactions [18427 - 18427.11] ( Article 5 added by Stats. 1989, Ch. 663, Sec. 17. )

    Verify source ↗

    If an industrial loan company applies for a permit to issue securities or other consideration in exchange for certain outstanding securities, claims, or property interests, the commissioner may approve the terms and fairness of the exchange and may hold a hearing.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Securities Transactions [18427 - 18427.11] ( Article 5 added by Stats. 1989, Ch. 663, Sec. 17. ) ## 18427.8. Whenever an industrial loan company applies for a permit to issue any security or to deliver any other consideration (whether or not such security or such transaction is exempt from, or not subject to, the provisions of Section 18427.1) in exchange for one or more bona fide outstanding securities (as defined in Section 25019 of the Corporations Code), claims, or property interests, or partly in such exchange and partly for cash, the commissioner is authorized to approve the terms and conditions of such issuance and exchange or such delivery and exchange and the fairness of such terms and conditions and is authorized to hold a hearing on the fairness of such terms and conditions, at which all persons to whom it is proposed to issue any security or to deliver any other consideration in such exchange shall have the right to appear. (Added by Stats. 1996, Ch. 1064, Sec. 610. Effective January 1, 1997. Operative July 1, 1997.)
  126. 18427.9.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Securities Transactions [18427 - 18427.11] ( Article 5 added by Stats. 1989, Ch. 663, Sec. 17. )

    Verify source ↗

    This section exempts certain securities offers and related transactions from Section 18427.1, and allows the commissioner to exempt others by regulation or order.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 5. Administration and Powers of the Commissioner [18339 - 18427.11] ( Chapter 5 added by Stats. 1976, Ch. 964. ) ## ARTICLE 5. Securities Transactions [18427 - 18427.11] ( Article 5 added by Stats. 1989, Ch. 663, Sec. 17. ) ## 18427.9. There shall be exempted from the provisions of Section 18427.1 all of the following: (a) (1) Any offer, not involving a public offering, to an affiliate or to a person of the type described in subdivision (i) of Section 25102 of the Corporations Code or in the regulations of the Commissioner of Financial Protection and Innovation adopted thereunder. (2) The execution and delivery of an agreement for the sale of securities to any person of the type described in paragraph (1), subject to all of the following: (A) The agreement shall contain substantially the following provision: “The sale of the securities which are the subject of this agreement has not been authorized by a permit issued by the Commissioner of Financial Protection and Innovation. The issuance of the securities or the payment or receipt of any part of the consideration therefor prior to the issuance of a permit is unlawful, unless the sale of securities is exempt from Section 18427.1 of the California Financial Code. The rights of all parties to this agreement are expressly conditioned upon the issuance of a permit, unless the sale is so exempt.” (B) No part of the purchase price may be paid or received, and none of the securities may be issued, until a permit authorizing the sale of the securities is issued, unless the sale is exempt from Section 18427.1. (b) Any transaction or security that the commissioner by regulation or order exempts as not being comprehended within the purposes of this article and the regulation of which they find is not necessary or appropriate in the public interest or for the protection of investors. (Amended by Stats. 2022, Ch. 452, Sec. 130. (SB 1498) Effective January 1, 2023.)
  127. 18435.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    A person who willfully violates this division or a rule or order under it may be fined, jailed, or both.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. ) ## 18435. Except as otherwise provided in this division, any person who willfully violates any provision of this division, or who willfully violates any rule or order adopted pursuant to this division, shall, upon conviction, be punished by a fine of not more than ten thousand dollars ($10,000), by imprisonment in a county jail for not more than one year or pursuant to subdivision (h) of Section 1170 of the Penal Code, or by both that fine and imprisonment. However, no person may be imprisoned for the violation of any rule or order unless he or she had knowledge of the rule or order. Conviction under this section shall not preclude the commissioner from exercising the authority provided in Section 18349.5. (Amended by Stats. 2011, Ch. 15, Sec. 111. (AB 109) Effective April 4, 2011. Operative October 1, 2011, by Sec. 636 of Ch. 15, as amended by Stats. 2011, Ch. 39, Sec. 68.)
  128. 18436.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    An industrial loan company must not make loans or guarantee obligations for its directors, officers, or the directors and officers of its holding company or affiliates.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. ) ## 18436. An industrial loan company shall not, directly or indirectly, make any loan of money or property to or guarantee the obligation of any of its directors or officers, or officers and directors of its holding company, or officers and directors of its affiliates. (Amended by Stats. 1980, Ch. 418, Sec. 4.)
  129. 18437.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    An industrial loan company generally may not make or buy loans or obligations involving non-California residents or businesses unless the listed conditions or exceptions are met.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. ) ## 18437. (a) Except as provided in subdivision (b), an industrial loan company shall not make loans to, or purchase any obligations from, persons who do not reside or have a place of business in the State of California, unless those loans or obligations comply with all of the following conditions: (1) If the loan or obligation is unsecured, then only if the loan or obligation bears the unqualified written guaranty of a financially responsible person, considering the amount of the obligation, who resides or has a place of business in the State of California. (2) If the documents and security for the loan or obligation and all records relating to the transaction are in California at the time the loan or obligation is made or acquired and are thereafter kept in California while the loan or obligation remains unsatisfied, except that where the security is aircraft, the security need not be in California at the time the loan or obligation is made or acquired, nor need it thereafter be held in California while the loan or obligation remains unsatisfied. (b) Notwithstanding subdivision (a), an industrial loan company may make loans to, or purchase any obligations from, persons who do not reside or have a place of business in the State of California not to exceed 25 percent, in the aggregate, of an industrial loan company’s total assets. Upon application to and approval by the commissioner, an industrial loan company may increase its loans to, or purchases of obligations from, persons who do not reside or have a place of business in this state not to exceed 50 percent, in the aggregate, of an industrial loan company’s total assets. The application shall include all of the following information: (1) A description of the company’s proposed plan of business. (2) The character, business qualifications, and other experience of the proposed officers and managers directing the line of business for which authorization is requested. (3) Any other facts and circumstances bearing on the proposal that, as determined by the commissioner, may be relevant. (c) This section does not apply to loans made to, or acquired from, persons who do not reside or have a place of business in this state if all of the following conditions are met: (1) The loans are for the purchase or refinance of single- or multi-family residential property or nonresidential property. (2) The loans are salable in the secondary market as evidenced by commitments to buy by a buyer in the secondary market. (3) The loans are owned by the industrial loan company for 90 days or less. (Amended by Stats. 1999, Ch. 345, Sec. 4. Effective January 1, 2000.)
  130. 18438.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    Certain officers, directors, and shareholders can be personally liable for losses caused by specified loan-related violations.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. ) ## 18438. If a loan is made or other thing is purchased or discounted in violation of Section 18271, 18272, 18273, 18274, or 18437, the officers, directors and shareholders of the industrial loan company, its holding company, or its affiliates participating therein or knowingly approving the same shall be personally liable for any loss suffered by the industrial loan company by reason thereof. (Amended by Stats. 1980, Ch. 418, Sec. 5.)
  131. 18439.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    If a loan contract includes charges above the amount allowed by this division, the contract is void unless the excess results from an accidental and bona fide computation error.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. ) ## 18439. If any amount in excess of the charges permitted by this division, including interest, is charged, contracted for, or received in the making or collection of a contract of loan, except as a result of an accidental and bona fide error in computation, such contract is void and no person has any right to collect or receive the principal, interest, or charges. (Added by Stats. 1976, Ch. 964.)
  132. 18440.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    An industrial loan company must not take a confession of judgment or a power of attorney when making a loan, except for certain powers of attorney tied to vehicle transfers, securities transfers, or cancelling an insurance policy in a loan default situation.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. ) ## 18440. An industrial loan company shall not take any confession of judgment or any power of attorney at the time of making the loan except a power of attorney taken to effectuate the transfer of the ownership of any motor vehicle, the transfer of the ownership of securities, or the cancellation of an insurance policy and the receipt and distribution of any unearned premiums in the event of default in the payment of a loan made to finance the purchase of any such insurance policy. (Added by Stats. 1976, Ch. 964.)
  133. 18441.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    A person involved in making a loan under this division must not require the borrower to buy or agree to buy anything connected to the loan, and must not require a collateral sales agreement or contract unless expressly permitted. Certain specified insurance policies are not prohibited.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. ) ## 18441. No person in connection with or incidental to the making of any loan under this division, shall require the borrower to contract for, purchase, or agree to purchase anything in connection with the loan. A policy of insurance of the type specified in Article 6 (commencing with Section 18290) of Chapter 3 of this division is not prohibited by this section. No person shall require a borrower to enter into any collateral sales agreement or contract except as expressly permitted by this division. (Added by Stats. 1976, Ch. 964.)
  134. 18442.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    An industrial loan company must not make loans or guarantee obligations secured by its own capital, its holding company’s capital, or its affiliates’ capital.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. ) ## 18442. An industrial loan company shall not make any loan of money or property to or guarantee the obligation of any person upon the security of its capital (including the shares of capital stock) of the company, its holding company, or its affiliates. (Amended by Stats. 1989, Ch. 663, Sec. 18. Operative January 1, 1991, by Sec. 20 of Ch. 663.)
  135. 18443.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    If a loan or guaranty violates Section 18436 or 18442, the directors and officers who authorized or assented to it are liable to the company as guarantors, including 6% yearly interest until paid.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. ) ## 18443. If any loan or guaranty is made in violation of Section 18436 or 18442, the directors and officers who authorize it or assent thereto are jointly and severally liable to the company as guarantors for the repayment or return of the sum or value so loaned with interest thereon at the rate of 6 percent per year until paid. (Added by Stats. 1976, Ch. 964.)
  136. 18444.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    An officer or director who is liable under Section 18443 and pays that liability may seek contribution from other participating officers or directors and takes over the corporation’s rights against the borrower or principal obligor.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. ) ## 18444. Any officer or director held liable under Section 18443, who satisfies such liability is entitled to contribution from any other officer or director who participates in authorizing, making or allowing any such loan or guaranty, and is subrogated to all rights of the corporation against the borrower or principal obligor. (Added by Stats. 1976, Ch. 964.)
  137. 18445.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    Certain directors, officers, and employees of industrial loan companies and related entities must not ask for or accept value for helping procure loans or related purchases/discounts; doing so is a felony.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. ) ## 18445. Any director, officer, or employee of an industrial loan company, its holding company, or its affiliates who asks for or receives, or consents or agrees to receive any commission, emolument, or gratuity or any money, property, or thing of value for procuring or endeavoring to procure for any person any loan from such company, or the purchase or discount of any note, contract, or other obligation or property by such company, is guilty of a felony. (Amended by Stats. 1980, Ch. 418, Sec. 7.)
  138. 18446.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    Directors, officers, or employees of an industrial loan company, its holding company, or its affiliates commit a felony if they knowingly misappropriate company property or falsify/omit material book entries.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. ) ## 18446. Any director, officer, or employee of an industrial loan company, its holding company, or its affiliates who knowingly receives or possesses himself of any of its property otherwise than in payment of a just demand, or with intent to defraud, omits to make or causes to be made a full and true entry thereof in its books and accounts or concurs in omitting to make any material entry thereof, is guilty of a felony. (Amended by Stats. 1980, Ch. 418, Sec. 8.)
  139. 18447.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    Certain directors, officers, and employees of industrial loan companies and related entities must not make false entries or false statements in books, records, or reports, and must cooperate with commissioner inspections of the books; violating this section is a felony.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. ) ## 18447. Any director, officer, or employee of an industrial loan company, its holding company, or its affiliates who knowingly makes or concurs in making or publishing any false entry in its books or records, any written report, exhibit, or statement of its affairs or pecuniary condition containing any material statement which is false, or having the custody of its books, willfully refuses or neglects to make any proper entry in such books as required by law, or to exhibit or allow the same to be inspected or extracts to be taken therefrom by the commissioner or his deputies or investigators, is guilty of a felony. (Amended by Stats. 1980, Ch. 418, Sec. 9.)
  140. 18448.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    Certain insiders of an industrial loan company and its related entities may not buy company assets below current market value, unless the board expressly approves the purchase, and title cannot pass until cash is fully received.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. ) ## 18448. No director, officer, stockholder, or employee of an industrial loan company, its holding company, or its affiliates shall purchase, directly or indirectly, or be interested in the purchase of, any of the company’s assets for an amount less than the then current market value thereof and any such purchase may not be made without the express approval of the board of directors of the company. Title and possession of assets shall not be transferred to the purchaser until full consideration in cash has been received by the industrial loan company. Every person violating this section shall be liable to the company for twice the market value of the assets so purchased. (Amended by Stats. 1980, Ch. 418, Sec. 10.)
  141. 18449.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    A director of an industrial loan company commits a misdemeanor if they participate in fraudulent insolvency, willfully do an act forbidden by law, or willfully fail to perform a legal duty as director.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. ) ## 18449. Every director of an industrial loan company who: (a) In the case of the fraudulent insolvency of such company, shall have participated in such fraud; or (b) Willfully does any act as such director which is expressly forbidden by law or willfully omits to perform any duty imposed upon him as such director by law, is guilty of a misdemeanor. The insolvency of a company is deemed fraudulent for the purposes of this section, unless its affairs appear upon investigation to have been administered clearly, legally, and with the same care and diligence that agents receiving a compensation for their services are bound by law, to observe. (Added by Stats. 1976, Ch. 964.)
  142. 18450.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    A director, officer, or employee of an industrial loan company, its holding company, or its affiliates is guilty of a misdemeanor if they concur in a vote or act intended to make a loan or buy a contract that violates this division.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. ) ## 18450. A director, officer, or employee of an industrial loan company, its holding company, or its affiliates who concurs in any vote or act by which it is intended to make a loan or purchase a contract in violation of this division, is guilty of a misdemeanor. (Amended by Stats. 1980, Ch. 418, Sec. 11.)
  143. 18451.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    Certain directors, officers, and employees of industrial loan companies, their holding companies, and affiliates must not place company funds with a person if that deposit is tied to a loan or advance back to them.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. ) ## 18451. A director, officer, or employee of an industrial loan company, its holding company, or its affiliates who makes or maintains, or attempts to make or maintain, a deposit of such company’s funds with any other person on condition, or with the understanding, express or implied, that the person receiving such deposit make a loan or advance, directly or indirectly, to any director, officer, or employee of the company so making or maintaining or attempting to make or maintain such deposit, is guilty of a misdemeanor. (Amended by Stats. 1980, Ch. 418, Sec. 12.)
  144. 18452.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    Officers or employees of an industrial loan company, its holding company, or affiliates must not sell investment or thrift certificates if they know the company is insolvent.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. ) ## 18452. Every officer or employee of an industrial loan company, its holding company, or its affiliates who sells investment or thrift certificates knowing that the company is insolvent, is guilty of a misdemeanor. (Amended by Stats. 1980, Ch. 418, Sec. 13.)
  145. 18453.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    A person who knowingly sells investment certificates in violation of this division or of any commissioner order or regulation commits a felony.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. ) ## 18453. Any person who knowingly sells investment certificates in violation of any provision of this division or any order or regulation of the commissioner, is guilty of a felony. (Added by Stats. 1976, Ch. 964.)
  146. 18454.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    Certain directors, officers, agents, and employees of industrial loan companies and related entities must not make false entries, omit required entries, or alter, hide, or destroy company records when intending to deceive specified examiners or officers; doing so is a felony.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. ) ## 18454. Any director, officer, agent or employee of an industrial loan company, its holding company, or its affiliates who willfully makes a false or untrue entry in any book or record or in any report, tag, or statement of the business, affairs, or condition, or in connection with any transaction of such company, with intent to deceive any officer, director, or employee thereof, or any agent or examiner, private or official, employed or lawfully appointed to examine into its condition or any of its affairs or transactions, or to any public officer who has authority to examine into its affairs or transactions, or who, with like intent, willfully omits to make a new entry of any matter particularly pertaining to the business property condition, affairs, transactions, assets or accounts of such company in any book, record, report, statement, or tag of such company, or who, with like intent, alters, abstracts, conceals, or destroys any book, record, report, statement, or tag of such company made, written, or kept, or required to be made, written, or kept by him or under his direction, is guilty of a felony. (Amended by Stats. 1980, Ch. 418, Sec. 14.)
  147. 18454.5.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    A person must not willfully make a false material statement, or willfully leave out a required material fact, in a document filed with the commissioner under this division.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. ) ## 18454.5. It is unlawful for any person to willfully make any untrue statement of a material fact in any document filed with the commissioner under this division, or to willfully omit to state in any document any material fact which is required to be stated therein. (Added by Stats. 1988, Ch. 537, Sec. 2.)
  148. 18455.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    An industrial loan company is generally prohibited from making or acquiring loans and related contracts with certain insiders and related persons, but several exceptions apply.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. ) ## 18455. An industrial loan company shall not, directly or indirectly, make any loan to, or purchase a contract, loan, or chose in action from, hold a lease obligation of, or purchase a lease contract from, any of the following: (a) A person who is an officer or director of the industrial loan company or of its holding or affiliated company. (b) A person who is a holder of record or beneficiary of the shares of the industrial loan company or of any holding or affiliated company. This restriction shall not apply to persons holding less than 10 percent of the shares of a holding company or affiliated company that is exempt from the qualification requirements of the Corporate Securities Law of 1968 contained in Section 25130 of the Corporations Code, pursuant to subdivision (a) or (b) of Section 25101 of the Corporations Code. (c) A person in which an officer or director of the industrial loan company or of any holding or affiliated company directly or indirectly is financially interested, directly or indirectly. (d) A person in which the holder of record or beneficiary of the shares of the industrial loan company or of any holding or affiliated company directly or indirectly is financially interested, directly or indirectly. This restriction shall not apply to persons holding less than 10 percent of the shares of a holding company or affiliated company that is exempt from the qualification requirements of the Corporate Securities Law of 1968 contained in Section 25130 of the Corporations Code, pursuant to subdivision (a) or (b) of Section 25101 of the Corporations Code. (e) A person who acquired those contracts directly or indirectly or through intervening assignments from a person described in subdivision (a), (b), (c), or (d). Any officer, director, or shareholder of an industrial loan company who directly or indirectly makes or procures, or participates in making or procuring, a loan or contract in violation of this section or knowingly approves the same is personally liable for any loss resulting to an industrial loan company from the loan or contract, in addition to any other penalties provided by law. (f) The prohibition contained in this section shall not apply to the purchase by an industrial loan company of a contract, loan, or chose in action from a finance lender, as described in Section 22009, a mortgage broker, a mortgage banker, a real estate broker or other licensed lender, provided written authorization for the purchase is obtained from the commissioner. (g) The prohibition contained in this section shall not apply to the purchase of life insurance by an industrial loan company on behalf of an officer or director as part of the officer’s or director’s employee benefit plan package. (h) The prohibition contained in this section shall not apply to the following transactions: (1) A transaction between an industrial loan company and a subsidiary corporation or other entity in which the industrial loan company is the owner of 50 percent or more of the common stock or equity interest, or directly controls the management of the corporation or other entity. (2) The purchase of loans or other obligations by an industrial loan company from an affiliated company pursuant to a sale and repurchase agreement. (Amended by Stats. 1997, Ch. 201, Sec. 6. Effective January 1, 1998.)
  149. 18456.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    This chapter applies to lease obligations.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. ) ## 18456. The provisions of this chapter shall be applicable to lease obligations. (Added by Stats. 1979, Ch. 911.)
  150. 18457.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    Certain company officers, directors, employees, or agents must not steal or misuse an industrial loan company’s money, property, funds, or credit; doing so is a felony.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 6. Prohibited Practices and Penalties [18435 - 18457] ( Chapter 6 added by Stats. 1976, Ch. 964. ) ## 18457. Any officer, director, employee, or agent of any company who abstracts or willfully misapplies any of the money, funds, or property of the industrial loan company, or willfully misapplies its credit, is guilty of a felony. Upon conviction, the court shall, in addition to any other punishment imposed, order the person to make full restitution to the industrial loan company. 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. (Added by Stats. 1990, Ch. 947, Sec. 5.)
  151. 18475.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 1. Definitions [18475 - 18481] ( Article 1 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    This section defines “guaranty corporation” as Thrift Guaranty Corporation of California.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 1. Definitions [18475 - 18481] ( Article 1 added by Stats. 1976, Ch. 964. ) ## 18475. “Guaranty corporation” means Thrift Guaranty Corporation of California which exists under the Nonprofit Mutual Benefit Corporation Law (Part 3 (commencing with Section 7110) of Division 2 of Title 1 of the Corporations Code). (Amended by Stats. 1978, Ch. 1305.)
  152. 18476.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 1. Definitions [18475 - 18481] ( Article 1 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    This section defines “Member” and “Special member” for the chapter.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 1. Definitions [18475 - 18481] ( Article 1 added by Stats. 1976, Ch. 964. ) ## 18476. (a) “Member” means an industrial loan company required by Section 18100.5 to be a member of Guaranty Corporation. “Member” includes “special member” except where the term “special member” is used in the same section of this chapter. (b) “Special member” means a member whose thrift obligations are insured by the Federal Deposit Insurance Corporation or by the Federal Savings and Loan Insurance Corporation or, subject to any rules promulgated by the commissioner, by a private insurer, surety or guarantee corporation acceptable to and approved by the commissioner. (Amended by Stats. 1985, Ch. 142, Sec. 8. Effective July 1, 1985.)
  153. 18477.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 1. Definitions [18475 - 18481] ( Article 1 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    This section defines “thrift obligations” for this chapter.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 1. Definitions [18475 - 18481] ( Article 1 added by Stats. 1976, Ch. 964. ) ## 18477. “Thrift obligations” as used in this chapter include principal invested in investment or thrift certificates however evidenced, and unpaid interest thereon accrued as of the last interest accrual date prior to the date the commissioner takes possession of the property and business of a member or the date such member is the subject of an order for relief in bankruptcy, whichever occurs sooner. (Amended by Stats. 2009, Ch. 500, Sec. 41. (AB 1059) Effective January 1, 2010.)
  154. 18478.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 1. Definitions [18475 - 18481] ( Article 1 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    “Fund” means the Guaranty Corporation Fund established under Section 18535.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 1. Definitions [18475 - 18481] ( Article 1 added by Stats. 1976, Ch. 964. ) ## 18478. “Fund” means the Guaranty Corporation Fund established pursuant to Section 18535. (Added by Stats. 1985, Ch. 142, Sec. 9. Effective July 1, 1985.)
  155. 18479.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 1. Definitions [18475 - 18481] ( Article 1 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    This section defines “capital contribution” as the amount each member must maintain as an investment in the corporation under Section 18535.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 1. Definitions [18475 - 18481] ( Article 1 added by Stats. 1976, Ch. 964. ) ## 18479. “Capital contribution” means the amount each member is required to maintain as an investment in the corporation pursuant to Section 18535. (Added by Stats. 1985, Ch. 142, Sec. 10. Effective July 1, 1985.)
  156. 18480.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 1. Definitions [18475 - 18481] ( Article 1 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    This section defines “member account” as the total amounts credited to a member for paid-in capital contributions and other credits, minus any charges.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 1. Definitions [18475 - 18481] ( Article 1 added by Stats. 1976, Ch. 964. ) ## 18480. “Member account” means the total of all amounts credited to a member for paid-in capital contributions, and other credits, net of any charges to that participating member. (Added by Stats. 1985, Ch. 142, Sec. 11. Effective July 1, 1985.)
  157. 18481.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 1. Definitions [18475 - 18481] ( Article 1 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    This section defines “guaranteed investment certificate” as a thrift obligation guaranteed by Guaranty Corporation under Section 18523.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 1. Definitions [18475 - 18481] ( Article 1 added by Stats. 1976, Ch. 964. ) ## 18481. “Guaranteed investment certificate” means a thrift obligation guaranteed by Guaranty Corporation pursuant to Section 18523. (Added by Stats. 1985, Ch. 142, Sec. 12. Effective July 1, 1985.)
  158. 18490.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    If liquidation proceeds are not enough, the commissioner must direct Guaranty Corporation to pay the shortfall, and Guaranty Corporation must pay it within 10 days after demand.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18490. When the property and business of a member, other than a special member, has been liquidated or is in the process of liquidation by the commissioner and the proceeds of liquidation distributed ratably are insufficient to pay up to fifty thousand dollars ($50,000) of each thrift obligation specified in Section 18523, the commissioner shall direct Guaranty Corporation to pay and Guaranty Corporation shall pay each such deficiency at the direction of and in amounts as directed by the commissioner within 10 days from the date the commissioner makes demand for payment. If the total funds available from Guaranty Corporation at that time are insufficient to pay in full the amounts provided by Section 18523, the amount paid to each thriftholder shall be ratably reduced in proportion to the amount by which the fund is deficient, and thereafter further payments shall be made ratably to such thriftholders in accordance with the directions of the commissioner as additional funds are paid into the fund from assessments or otherwise. If the thrift obligations are paid, each member’s account and special member’s account shall be reduced ratably based on the account balance for the total amount paid. (Amended by Stats. 1985, Ch. 142, Sec. 13. Effective July 1, 1985.)
  159. 18491.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. )

    Verify source ↗

    If a member is being liquidated, the commissioner may direct Guaranty Corporation to pay covered thrift obligations, and Guaranty Corporation must pay within 10 days after demand.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18491. (a) When the property and business of a member, other than a special member, is being liquidated, the commissioner may direct Guaranty Corporation to pay each thrift obligation of the member specified in Section 18523 up to fifty thousand dollars ($50,000). Guaranty Corporation shall pay the thrift obligations at the direction of, and in the amounts directed by, the commissioner within 10 days from the date the commissioner makes demand for payment under this section. If the total funds available from Guaranty Corporation at that time are insufficient to pay in full the amounts provided by Section 18523, the amount paid to each thriftholder shall be ratably reduced in proportion to the amount by which the fund is deficient, and thereafter further payments shall be made ratably to those thriftholders in accordance with the directions of the commissioner as additional funds become available to Guaranty Corporation. (b) When any thrift obligation is paid up to the guaranteed amount as provided in subdivision (a), Guaranty Corporation shall be assigned all rights, title, and interest to each individual thrift obligation up to the amount paid by Guaranty Corporation to each individual thriftholder. (c) Guaranty Corporation shall first receive ratable liquidation proceeds up to the amount paid by Guaranty Corporation to a thriftholder prior to any payment of liquidation proceeds to a thriftholder whose account was in excess of fifty thousand dollars ($50,000). (d) Each member’s account and each special member’s account shall be reduced ratably based on the account balance for the total amount paid pursuant to subdivision (a). Liquidation proceeds paid to Guaranty Corporation pursuant to subdivision (c) shall ratably increase each member and special member account based on the account balance for the total amount paid pursuant to subdivision (a). (Amended by Stats. 1985, Ch. 142, Sec. 14. Effective July 1, 1985.)
  160. 18493.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. )

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    If the commissioner finds certain violations or refusals by Guaranty Corporation, the commissioner may take possession of its property and business, and while doing so must carry out Guaranty Corporation’s duties and obligations.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18493. Whenever it appears to the commissioner that Guaranty Corporation has: (a) Violated its articles of incorporation or any law of this state; (b) Not paid amounts as directed by the commissioner pursuant to Section 18490; (c) Invested its funds in violation of Section 18497; (d) Not levied assessments as required by Sections 18535 and 18536; (e) Has not brought and diligently prosecuted an action to enforce payment as required by Section 18538; (f) Violated any section of this chapter; or (g) Neglected or refused to submit its books, papers, and affairs to the inspection of any examiner; the commissioner may forthwith take possession of the property and business of Guaranty Corporation and retain possession until Guaranty Corporation satisfies the commissioner that it will operate in conformity with this chapter. During the time the commissioner has such possession he shall perform the duties and carry out the obligations of Guaranty Corporation. (Added by Stats. 1976, Ch. 964.)
  161. 18494.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. )

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    If the commissioner takes possession of Guaranty Corporation’s property and business, Guaranty Corporation may ask the superior court within 10 days to stop further proceedings.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18494. Whenever the commissioner has taken possession of the property and business of Guaranty Corporation, Guaranty Corporation within 10 days after such taking, if it deems itself aggrieved thereby, may apply to the superior court in the county in which the head office of Guaranty 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 such application or enjoin the commissioner from further proceedings and direct him to surrender the property and business to Guaranty Corporation, or make such further order as may be just. (Added by Stats. 1976, Ch. 964.)
  162. 18495.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. )

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    The commissioner or Guaranty Corporation may appeal the court’s judgment, and the appeal does not automatically stay the judgment unless the court orders a stay for good cause.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18495. An appeal may be taken from the judgment of the court by the commissioner or by Guaranty 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. (Amended by Stats. 1998, Ch. 931, Sec. 150. Effective September 28, 1998.)
  163. 18496.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. )

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    Guaranty Corporation can approve, suspend, or revoke member participation, and it can obtain and use member financial information for its duties. Certain reports and information are confidential, and misuse of the information can be a misdemeanor.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18496. (a) Guaranty Corporation shall have independent authority to approve membership, or suspend or revoke the right to participate in Guaranty Corporation by any member for cause and to submit reports and make recommendations to the commissioner regarding the financial condition of any member and shall also do so if requested by the commissioner. These reports and recommendations shall not be public documents. There shall be no liability on the part of, and no cause of action of any nature shall arise against, Guaranty Corporation or its members, directors, officers, employees or agents, or the commissioner or his or her authorized representatives, for any statements made by them in any reports or recommendations made hereunder. (b) In order to permit Guaranty Corporation to fulfill its obligations under subdivision (a), upon the written request of Guaranty Corporation the commissioner may furnish to Guaranty Corporation a copy of financial statements or reports filed by a member or an industrial loan company making application to participate in Guaranty Corporation and a copy of the commissioner’s analysis of an industrial loan company’s receivables. Except for reports filed under Sections 18407 and 18410, such statements and reports shall not be public documents, and the information contained therein shall be privileged, and confidential to Guaranty Corporation for its sole use in carrying out its statutory functions. 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 representatives, for the release of any information furnished to Guaranty Corporation pursuant to this subdivision. (c) By written consent of a majority of its directors, Guaranty Corporation, in order to fulfill its obligations under subdivision (a), may appoint an independent certified public accountant or public accountant to prepare an audit report containing audited financial statements, together with such other information as Guaranty Corporation, in good faith, requires regarding the financial condition of any member. For the purposes of examination and investigation the certified public accountant or public accountant appointed by Guaranty Corporation shall have free access to the offices and places of business, books, accounts, papers, records, files, safes and vaults of the member. (d) By written consent of a majority of its directors, Guaranty Corporation, in order to fulfill its obligations under subdivision (a), may hire or appoint specialized committees or employees to investigate the operations of a member company. Guaranty Corporation may have its specialized employees or committees investigate the affairs and examine the books, accounts, records and files used in the business of the member. For the purposes of examination and investigation the specialized employees and committees of Guaranty Corporation shall have free access to the offices and places of business, books, accounts, papers, records, files, safes, and vaults of the member. (e) Costs and expenses for such audit report or special investigation report shall be paid by Guaranty Corporation. (f) Any person who uses any information obtained under subdivision (b), (c) or (d) for any purpose not authorized by subdivision (a) is guilty of a misdemeanor. (g) The powers granted to the Guaranty Corporation by this section may not be exercised in connection with special members. (Amended by Stats. 1985, Ch. 142, Sec. 16. Effective July 1, 1985.)
  164. 18496.1.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. )

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    The board of directors must try to obtain errors and omissions liability insurance and, if it is available, report the coverage terms and costs to the commissioner within 30 days after each fiscal year end.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18496.1. (a) A director, officer, employee, or agent of Thrift Guaranty Corporation shall be subject to liability for acts of fraud, willful misconduct, or reckless or criminal acts arising out of, or in connection with, the performance of his or her duties on behalf of Thrift Guaranty Corporation, but shall not be subject to liability or causes of action for acts other than those set forth in this section. (b) The board of directors shall exercise reasonable efforts to obtain directors, officers, employees, and agents, errors and omissions liability insurance coverage and shall within 30 days from the end of each fiscal year submit to the commissioner its reports, advising the commissioner of the terms and costs of such coverage, if available. (Added by Stats. 1985, Ch. 1349, Sec. 1. Effective October 1, 1985.)
  165. 18497.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. )

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    Guaranty Corporation may invest only in readily marketable securities under the commissioner’s rules and must provide a disclosure authorization if the commissioner asks.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18497. Guaranty Corporation may invest its funds only in readily marketable securities as provided by rules of the commissioner. Upon request of the commissioner, Guaranty Corporation shall furnish an authorization for disclosure to the commissioner of financial records of such funds pursuant to Section 7473 of the Government Code. (Amended by Stats. 1985, Ch. 142, Sec. 17. Effective July 1, 1985.)
  166. 18498.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. )

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    Investment income must be recorded in an income account and used for administration expenses. Excess income may be credited to members’ accounts, and Guaranty Corporation’s income may be demanded by the commissioner except for the amount reserved for administration expenses during the calendar year.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18498. Income from investments shall be recorded in an income account and be used to defray expenses of administration. Income from investments that exceeds an amount determined by the board of directors to be adequate to provide for current expenses may be credited to members’ accounts. Each member’s account shall receive credit ratably based on the account balance, for the amount of the excess. Income received by Guaranty Corporation, whether or not credited to members’ accounts, shall be subject to a demand of the commissioner made pursuant to Section 18490 except as to that portion reserved by the board of directors for expenses of administration during the calendar year. (Added by Stats. 1976, Ch. 964.)
  167. 18499.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. )

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    Year-end administration expenses that exceed investment income must be charged to members’ accounts.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18499. Expenses of administration that exceed income from investments at year end shall be charged to members’ accounts. Each member’s account shall be charged ratably based on the account balance for the amount of the excess. (Added by Stats. 1976, Ch. 964.)
  168. 185.

    ## 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. )

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    This section defines “licensee” to include several categories of institutions and persons licensed or authorized by the commissioner.

    ## 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. ) ## 185. “Licensee” has the following meanings: (a) Any bank authorized by the commissioner pursuant to Section 1042 to transact banking or trust business. (b) Any industrial bank authorized by the commissioner pursuant to Section 1042 to transact industrial banking business. (c) Any trust company authorized by the commissioner pursuant to Section 1042 to transact trust business. (d) Any foreign (other nation) bank that is licensed under Article 2 (commencing with Section 1780) of Chapter 20 or under Article 3 (commencing with Section 1800) of Chapter 20. (e) Any person licensed by the commissioner as a money transmitter pursuant to Division 1.2 (commencing with Section 2000). (f) Any person authorized by the commissioner to conduct the business of a savings association pursuant to Division 2 (commencing with Section 5000). (g) Any credit union authorized by the commissioner to conduct business pursuant to Section 14154. (h) Any foreign (other state) credit union licensed by the commissioner to conduct business pursuant to Chapter 11 (commencing with Section 16000) of Division 5. (i) Any foreign (other nation) credit union licensed by the commissioner to conduct business pursuant to Chapter 12 (commencing with Section 16500) of Division 5. (j) Any industrial loan company authorized by the commissioner to conduct insurance premium finance business pursuant to Division 7 (commencing with Section 18000). (k) Any corporation licensed by the commissioner as a business and industrial development corporation pursuant to Section 31154. (Amended by Stats. 2013, Ch. 334, Sec. 12. (SB 537) Effective January 1, 2014.)
  169. 1850.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 21. International and Foreign Banking and Financing [1850 - 1910] ( Chapter 21 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. International and Foreign Banking and Financing Corporations [1850 - 1897] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. )

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    This section defines “corporation” for this article.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 21. International and Foreign Banking and Financing [1850 - 1910] ( Chapter 21 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. International and Foreign Banking and Financing Corporations [1850 - 1897] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1850. As used in this article, unless the context otherwise requires, “corporation” means a corporation organized under the laws of this state for the purpose of transacting business pursuant to this article. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  170. 18500.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. )

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    Guaranty Corporation has authority to borrow, make financial transactions with members, organize a new thrift company, act as conservator or receiver, use the fund, and hire help; the commissioner may waive Industrial Loan Law provisions needed for the new thrift company.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18500. Guaranty Corporation shall have authority to: (a) Borrow funds when necessary to effectuate the provisions of this chapter. (b) Make loans to, deposits in, purchase assets or securities of, assume liabilities of, or make contributions to any Guaranty Corporation member to minimize the deficiency payments that might be required under Article 2 (commencing with Section 18490). (c) Organize a new thrift company to assume the thrift obligations and temporarily perform the functions of the closed company. The commissioner may waive any provision of the Industrial Loan Law necessary to enable Guaranty Corporation to organize a new thrift company. (d) Act as a conservator or receiver of a member company that the commissioner has taken possession of. (e) Guaranty Corporation may use the fund, or any portion of the fund, in exercising its authority. (f) Employ consultants, advisors, and others to assist Guaranty Corporation in fulfilling its obligations and objectives. (Amended by Stats. 1985, Ch. 142, Sec. 18. Effective July 1, 1985.)
  171. 18501.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. )

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

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18501. The commissioner shall give prompt notice to Guaranty 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. (Added by Stats. 1976, Ch. 964.)
  172. 18502.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. )

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

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18502. Memberships issued by Guaranty Corporation shall be nontransferable and shall be exempt from the provisions of the Corporate Securities Law of 1968. (Added by Stats. 1976, Ch. 964.)
  173. 18503.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. )

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    The commissioner and designated representatives may investigate Guaranty Corporation and inspect its books and records at any time.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18503. 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 Guaranty 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 Guaranty Corporation. (Amended by Stats. 1985, Ch. 142, Sec. 19. Effective July 1, 1985.)
  174. 18504.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. )

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    Certain members or industrial loan companies may appeal Guaranty Corporation decisions to the commissioner within 30 days if they are aggrieved.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18504. Any member or industrial loan company making application to participate in Guaranty Corporation aggrieved by any action or decision of Guaranty Corporation may appeal to the commissioner within 30 days from the action or decision. (Amended by Stats. 1985, Ch. 142, Sec. 20. Effective July 1, 1985.)
  175. 18505.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. )

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    The commissioner must adopt emergency rules and regulations about information given to industrial loan company investment certificate holders, including references to guarantees or insurance, payment timing and conditions, and how holders are informed of their rights.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18505. (a) After consultation with, and approval by, the Thrift Guaranty Corporation, the commissioner shall adopt rules and regulations regarding information to be given to holders of investment certificates of industrial loan companies including, but not limited to, information containing any reference to a guarantee or insurance program of investment certificates, and the time and conditions for payments to the holders of investment certificates, in the event an industrial loan company is taken over by the commissioner. These regulations shall include the means for informing investment certificate holders of their rights. (b) It is the intent of the Legislature that the commissioner authorize information which can be clearly understood by a typical investment certificate holder. In addition, the information may in no way imply that the State of California stands behind or is involved with any type of guarantee or insurance program for industrial loan companies investment certificate holders. (c) These rules and regulations shall be adopted on an emergency basis within 60 days of the effective date of this section. (Repealed and added by Stats. 1985, Ch. 142, Sec. 21.5. Effective July 1, 1985.)
  176. 18506.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. )

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    A person must not advertise or distribute statements claiming membership in Guaranty Corporation or saying thrift obligations are guaranteed.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18506. No person shall 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 its membership in Guaranty Corporation or that any of its thrift obligations are in any manner guaranteed. (Amended by Stats. 1989, Ch. 583, Sec. 3.)
  177. 18507.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. )

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    The commissioner must give Guaranty Corporation, by April 1 each year, a list of certain industrial loan companies and a copy of each company’s independent audit report.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18507. In order to permit Guaranty Corporation to fulfill its obligations under this chapter, the commissioner shall furnish to Guaranty Corporation a list of all industrial loan companies that are not insured companies which have outstanding thrift obligations and one copy of the independent audit report on each such industrial loan company filed with him as of the preceding December 31 and not later than April 1 of each year. (Amended by Stats. 1986, Ch. 1011, Sec. 5. Effective September 23, 1986.)
  178. 18508.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. )

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    An industrial loan company or its successor may not receive certain refunds, returns, withdrawals, or distributions from member accounts or paid assessments, except when Guaranty Corporation is being liquidated.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18508. An industrial loan company or its successor shall not be entitled to receive a refund, return, withdrawal, or distribution of the amount in its member’s account or of any assessments paid by it except upon liquidation of Guaranty Corporation. (Repealed and added by Stats. 1989, Ch. 583, Sec. 5.)
  179. 18509.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. )

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    Guaranty Corporation may choose to wind up and dissolve if it gets the required approvals and the stated member/guarantee conditions are met.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18509. (a) Guaranty Corporation may elect to wind up and dissolve upon approval of the commissioner, the board, and the members in accordance with Section 8610 of the Corporations Code, after (1) each industrial loan company has become a member of the Federal Deposit Insurance Corporation or redeemed all of its outstanding thrift obligations or (2) Guaranty Corporation has satisfied its guarantee of thrift obligations as provided in this chapter. (b) Upon liquidation, after complying with the provisions of Section 8713 of the Corporations Code and notwithstanding Section 8717 of the Corporations Code, the assets of Guaranty Corporation shall be distributed to its members, past and present, including special members, ratably based on the balance of the members’ accounts, as established by resolution of the Board of Directors of Guaranty Corporation in accordance with the following: (1) The account of each member, past and present, including special members, shall be credited with all assessments paid by the member to Guaranty Corporation. (2) For each fiscal year, all current and prior expenses of administration of Guaranty Corporation shall be charged to the accounts of all members, past and present, including special members, ratably based on the balance of each account. (3) With respect to the account of each member to whom Guaranty Corporation has advanced funds or on whose behalf Guaranty Corporation has paid claims and expenses, the following adjustments shall be made: (A) The member’s account shall be charged in the amount of the funds advanced or paid as of the date of advance or payment. (B) If the amount advanced or paid exceeds the balance of the member’s account, then (i) the member’s account shall be deemed to have been closed, and the excess shall be allocated and charged ratably to the accounts of all other members, past and present, including special members, and (ii) if the member continued to operate after the date of the advance or payment, whether under new ownership or management or under the management of Guaranty Corporation, then a new member account shall, for purposes of this section, be deemed to have been established for the member with a zero balance, which shall be credited with subsequent assessments paid. (Repealed and added by Stats. 1989, Ch. 583, Sec. 7.)
  180. 1851.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 21. International and Foreign Banking and Financing [1850 - 1910] ( Chapter 21 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. International and Foreign Banking and Financing Corporations [1850 - 1897] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. )

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    This section says the Chapter 1 rules that apply to banks also apply to corporations.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 21. International and Foreign Banking and Financing [1850 - 1910] ( Chapter 21 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. International and Foreign Banking and Financing Corporations [1850 - 1897] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1851. The provisions of Chapter 1 (commencing with Section 99) of Division 1 applicable to, or with respect to, banks shall apply to, or with respect to, as the case may be, corporations. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  181. 18510.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. )

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    The Board of Directors of Guaranty Corporation must have five members, at least two of whom are public members. The commissioner appoints the five members and must consult the President of Thrift Guaranty Corporation before making an appointment.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18510. The Board of Directors of Guaranty Corporation shall be composed of five members, at least two of which shall be public members. The five members shall be appointed by the commissioner. The commissioner shall consult with the President of Thrift Guaranty Corporation before making an appointment. Public members shall not be affiliated with any company or affiliate of any company or employed by any state agency. A public member shall not be a relative of any officer or director of any company or its affiliates. (Amended by Stats. 1996, Ch. 1064, Sec. 614. Effective January 1, 1997. Operative July 1, 1997.)
  182. 18511.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. )

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    Guaranty Corporation must establish a permanent office in this state.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18511. Guaranty Corporation shall establish a permanent office in this state. (Added by Stats. 1985, Ch. 142, Sec. 25. Effective July 1, 1985.)
  183. 18512.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. )

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    The commissioner may require Guaranty Corporation to get a bond, insurance, or reinsurance to protect members’ thriftholders from losses.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 2. General [18490 - 18512] ( Article 2 added by Stats. 1976, Ch. 964. ) ## 18512. The commissioner may require Guaranty Corporation to obtain a bond, insurance, or reinsurance which provides additional protection against losses to its members’ thriftholders. The type, amount, and form of this protection is subject to the commissioner’s written approval. (Added by Stats. 1985, Ch. 142, Sec. 26. Effective July 1, 1985.)
  184. 1852.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 21. International and Foreign Banking and Financing [1850 - 1910] ( Chapter 21 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. International and Foreign Banking and Financing Corporations [1850 - 1897] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. )

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    One or more persons may organize a corporation if they first get the commissioner’s written consent, as provided by Chapter 3.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 21. International and Foreign Banking and Financing [1850 - 1910] ( Chapter 21 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. International and Foreign Banking and Financing Corporations [1850 - 1897] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1852. When authorized by the previous written consent of the commissioner as provided by Chapter 3 (commencing with Section 1040) one or more persons may organize a corporation. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  185. 18520.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Purpose and Scope of Guaranty Corporation [18520 - 18525] ( Article 3 added by Stats. 1976, Ch. 964. )

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    The Guaranty Corporation’s purpose is to guarantee full payment of members’ guaranteed accounts, except special members, up to $50,000 per account and subject to chapter limitations.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Purpose and Scope of Guaranty Corporation [18520 - 18525] ( Article 3 added by Stats. 1976, Ch. 964. ) ## 18520. It shall be the purpose of Guaranty Corporation to guarantee full payment of guaranteed accounts of members, exclusive of special members, up to fifty thousand dollars ($50,000) for each account, subject to the express limitations provided in this chapter. (Amended by Stats. 1985, Ch. 142, Sec. 27. Effective July 1, 1985.)
  186. 18521.5.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Purpose and Scope of Guaranty Corporation [18520 - 18525] ( Article 3 added by Stats. 1976, Ch. 964. )

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    Industrial loan companies with outstanding thrift obligations must keep those obligations insured/guaranteed or in federal deposit insurance coverage, with a transition to FDIC membership after July 1, 1990.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Purpose and Scope of Guaranty Corporation [18520 - 18525] ( Article 3 added by Stats. 1976, Ch. 964. ) ## 18521.5. (a) Notwithstanding Section 18521 or 18100.5, until July 1, 1990, each industrial loan company, other than a premium finance agency, which has issued and has outstanding thrift obligations shall, as a condition of its authority to continue to conduct business under this division, have its outstanding thrift obligations insured or guaranteed by Thrift Guaranty Corporation, or participate as a member of the Federal Deposit Insurance Corporation; however, each industrial loan company shall, as a condition of its authority to continue to conduct business under this division, continue to participate as a member or a special member as defined in Section 18476, in Thrift Guaranty Corporation in accordance with this chapter and rules established by the Board of Directors of Thrift Guaranty Corporation until it has paid assessments required by Section 18537. (b) On and after July 1, 1990, each industrial loan company, other than a premium finance agency, which has issued and has outstanding thrift obligations, shall, as a condition of its authority to continue to conduct business under this division, participate as a member of the Federal Deposit Insurance Corporation. (c) Any person not transacting the business of an industrial loan company prior to the effective date of this section, who thereafter commences business under the provisions of this division, shall, upon commencement of its business, participate as a member of the Federal Deposit Insurance Corporation. (d) Thrift Guaranty Corporation shall have the power to seek insurance, guarantee, or surety, with an insurer or surety, or guarantor authorized to transact business in this state. The insurance shall be subject to the approval of the commissioner after consultation with the Insurance Commissioner. It is the intent of the Legislature to permit Thrift Guaranty Corporation to seek insurance and Thrift Guaranty Corporation’s insurer to seek reinsurance. Thrift Guaranty Corporation shall remain in existence after July 1, 1990, to assist in the winding up, liquidation, or merger of industrial loan companies unable to comply with the requirements of subdivision (b) by that date. Thrift Guaranty Corporation shall continue to guarantee outstanding thrift obligations sold and issued prior to July 1, 1990, by an industrial loan company which has not complied with the requirements of subdivision (b) by July 1, 1990, until all outstanding thrift obligations have been redeemed by the issuer, a successor to the issuer in compliance with the requirements of subdivision (b), or Thrift Guaranty Corporation. (e) In addition to any other provision of this section, if during that period of time ending July 1, 1990, the United States Congress or the Board of Governors of the Federal Reserve System adopt or amend a law or regulations which pertain to an industrial loan company applying for and obtaining membership in the Federal Deposit Insurance Corporation, and the new federal law or regulations prevent an industrial loan company from obtaining Federal Deposit Insurance Corporation coverage solely because the company’s holding company status prevents Federal Deposit Insurance Corporation membership, a successor to the Thrift Guaranty Corporation approved by the commissioner, or some other institutional mechanism approved by the commissioner, which obtains insurance in accordance with this subdivision, may continue to discharge its function so long as the insurance remains in effect. (f) Within one year of the effective date of the act which adds this section, and annually thereafter until July 1, 1990, the commissioner shall report to the Legislature on the following: (1) The progress of Thrift Guaranty Corporation in obtaining reinsurance. (2) The progress of licensees in converting to coverage by an instrumentality of the United States government or by a private insurer, surety, or guarantor. (3) Recommendations for additional legislation if, in the commissioner’s opinion, additional legislation would be desirable to encourage industrial loan companies to seek coverage for investment certificates from sources other than Thrift Guaranty Corporation. The commissioner shall submit special reports on these matters as may be required by the circumstances. (Amended by Stats. 1987, Ch. 787, Sec. 5.)
  187. 18521.6.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Purpose and Scope of Guaranty Corporation [18520 - 18525] ( Article 3 added by Stats. 1976, Ch. 964. )

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    An industrial loan company that does not comply with subdivision (b) of Section 18521.5 by June 30, 1990, may not continue selling or issuing investment certificates after that date.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Purpose and Scope of Guaranty Corporation [18520 - 18525] ( Article 3 added by Stats. 1976, Ch. 964. ) ## 18521.6. No industrial loan company which fails to comply with the requirements of subdivision (b) of Section 18521.5 by June 30, 1990, may continue to sell and issue investment certificates beyond that date. (Added by Stats. 1987, Ch. 787, Sec. 6.)
  188. 18523.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Purpose and Scope of Guaranty Corporation [18520 - 18525] ( Article 3 added by Stats. 1976, Ch. 964. )

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    Guaranty Corporation guarantees specified thrift obligations, generally up to $50,000 in the aggregate for each covered category.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Purpose and Scope of Guaranty Corporation [18520 - 18525] ( Article 3 added by Stats. 1976, Ch. 964. ) ## 18523. The following described thrift obligations will be guaranteed by Guaranty Corporation in the amounts hereinafter set forth below: (a) Single ownership investment certificates. Funds owned by an individual and invested in the manner set forth below shall be added together and guaranteed up to fifty thousand dollars ($50,000) in the aggregate. (1) Individual investment certificates (or investment certificates of the marital or domestic partnership community of which the individual is a member) and invested in one or more investment certificates in his or her own name shall be guaranteed up to fifty thousand dollars ($50,000) in the aggregate. (2) Funds owned by a principal and invested in one or more investment certificates in the name or names of agents or nominees shall be added to any individual investment certificates of the principal and guaranteed up to fifty thousand dollars ($50,000) in the aggregate. (3) Investment certificates held by guardians, custodians, or conservators for the benefit of their wards or for the benefit of a minor under a Uniform Gifts to Minors Act and invested in one or more investment certificates in the name of the guardian, custodian, or conservator shall be added to any individual investment certificates of the ward or minor and guaranteed up to fifty thousand dollars ($50,000) in the aggregate. (b) Testamentary investment certificates. (1) Funds owned by an individual and invested in a revocable trust investment certificate, tentative trust investment certificate, payable-on-death investment certificate, or similar investment certificate evidencing an intention that on his or her death the funds shall belong to his or her spouse, child, or grandchild, shall be guaranteed up to fifty thousand dollars ($50,000) in the aggregate, as to each such named beneficiary, separately from any other investment certificates of the owner. (2) If the named beneficiary of such an investment certificate is other than the owner’s spouse, child, or grandchild, the funds in the investment certificate shall be added to any individual investment certificates of such owner and guaranteed up to fifty thousand dollars ($50,000) in the aggregate, separately from the individual investment certificates of the beneficiaries of the estate or of the executor or administrator. (c) Investment certificates held by executors or administrators. Funds of a decedent held in the name of the decedent or in the name of the executor or administrator of his or her estate and invested in one or more investment certificates shall be guaranteed up to fifty thousand dollars ($50,000) in the aggregate, separately from the individual investment certificates of the beneficiaries of the estate or of the executor or administrator. (d) Corporation or partnership investment certificates. Investment certificates of a corporation or partnership engaged in any independent activity shall be guaranteed up to fifty thousand dollars ($50,000) in the aggregate. An investment certificate of a corporation or partnership not engaged in an independent activity shall be deemed to be owned by the person or persons owning such corporation or comprising such partnership and, for guarantee purposes, the interest of each person in the investment certificate shall be added to any other investment certificates individually owned by such person and guaranteed up to fifty thousand dollars ($50,000) in the aggregate. The term “independent activity” means any activity other than one directed solely at increasing guarantee coverage under this chapter. (e) Unincorporated associations. Investment certificates of an unincorporated association engaged in any independent activity shall be guaranteed up to fifty thousand dollars ($50,000) in the aggregate. An investment certificate of an unincorporated association not engaged in an independent activity shall be deemed to be owned by the persons comprising such association and, for guarantee purposes, the interest of each owner in the investment certificate shall be added to any other investment certificates individually owned by such person and guaranteed up to fifty thousand dollars ($50,000) in the aggregate. (f) Joint investment certificates. (1) Investment certificates owned jointly, whether as joint tenants with right of survivorship, as tenants by the entireties, as tenants in common, or by spouses as community property, shall be guaranteed separately from investment certificates individually owned by the coowners. (2) A joint investment certificate shall be deemed to exist, for purposes of guarantee of investment certificates, only if each coowner has personally executed an investment certificate signature card and possesses redemption rights. (3) An investment certificate owned jointly which does not qualify as a joint investment certificate for purposes of guarantee of investment certificates shall be treated as owned by the named persons as individuals and the actual ownership interest of each such person in such investment certificate shall be added to any other investment certificates individually owned by such person and guaranteed up to fifty thousand dollars ($50,000) in the aggregate. (4) All joint investment certificates owned by the same combination of individuals shall first be added together and guaranteed up to fifty thousand dollars ($50,000) in the aggregate. (5) The interest of each coowner in all joint investment certificates owned by different combinations of individuals shall then be added together and guaranteed up to fifty thousand dollars ($50,000) in the aggregate. (g) Trust investment certificates. All trust interests for the same beneficiary invested in investment certificates established pursuant to valid trust arrangements created by the same settlor (grantor) shall be added together and guaranteed up to fifty thousand dollars ($50,000) in the aggregate, separately from other investment certificates of the trustee of such trust funds or the settlor or beneficiary of such trust arrangements. (h) Thrift obligations withdrawn by checks that have not cleared a member’s bank account at the time the commissioner has taken possession of the property and business of a member. The owner of the funds represented by such a check shall be recognized for all purposes of a claim for guaranteed thrift obligations to the same extent as if his or her name and interest were disclosed on the records of the member. (Amended by Stats. 2016, Ch. 50, Sec. 39. (SB 1005) Effective January 1, 2017.)
  189. 18525.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Purpose and Scope of Guaranty Corporation [18520 - 18525] ( Article 3 added by Stats. 1976, Ch. 964. )

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    Guaranty Corporation may take on obligations, make contracts, borrow and lend money, use credit, and secure its obligations and liabilities, but only with the commissioner’s written consent.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 3. Purpose and Scope of Guaranty Corporation [18520 - 18525] ( Article 3 added by Stats. 1976, Ch. 964. ) ## 18525. Notwithstanding any other provision of this division, Guaranty Corporation, with the written consent of the commissioner, shall have the power to assume obligations, enter into contracts, including contracts of guarantee or suretyship, incur liabilities, borrow money, lend money or otherwise use its credit, and secure any of its obligations, contracts, or liabilities by mortgage, pledge, security interest, or other encumbrances of all or any part of its property and assets, including, but not limited to, income from assessments of members or rights thereto, and income. (Amended by Stats. 1985, Ch. 142, Sec. 34. Effective July 1, 1985.)
  190. 1853.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 21. International and Foreign Banking and Financing [1850 - 1910] ( Chapter 21 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. International and Foreign Banking and Financing Corporations [1850 - 1897] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. )

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    A corporation’s articles must state that its purpose is to conduct international and foreign banking and other permitted financial activities.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 21. International and Foreign Banking and Financing [1850 - 1910] ( Chapter 21 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. International and Foreign Banking and Financing Corporations [1850 - 1897] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1853. The articles of a corporation shall provide that the purpose of the corporation is to engage in the business of international and foreign banking and other international and foreign financial operations, the business of banking and other financial operations in any dependency or insular possession of the United States, and any other lawful activities which are not, by applicable laws or regulations, prohibited to a corporation transacting business under this article. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  191. 18535.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Assessments [18535 - 18538] ( Article 4 added by Stats. 1976, Ch. 964. )

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    Guaranty Corporation must maintain a guarantee fund, and members must make required payments or assessments based on member status, stock transfers, fund levels, and mergers.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Assessments [18535 - 18538] ( Article 4 added by Stats. 1976, Ch. 964. ) ## 18535. Guaranty Corporation shall establish and maintain a guarantee fund as follows: (a) Each new member, other than a new special member, shall pay one hundred thousand dollars ($100,000) to the guarantee fund to become a member. (b) Whenever the commissioner finds that the controlling interest or 50 percent or more of the stock of a member which paid less than one hundred thousand dollars ($100,000) to become a member has been transferred, the member shall pay to the fund whatever sums are necessary to bring the member’s total contribution pursuant to subdivision (a) to one hundred thousand dollars ($100,000) or 1 percent of the member’s total outstanding thrift obligations on the date of transfer, whichever is less. As used in this subdivision “controlling interest” means any percentage of stock which allows the stockholder to have control of management of the member company. The provisions of this subdivision shall not be applicable (1) if the transfer of stock is between affiliated companies of a holding company and the holding company is exempt from the qualification requirement of Section 25130 of the Corporate Securities Law of 1968 by subdivision (a) or (b) of Section 25101 of the Corporations Code, or (2) if 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, or to a transferee by a trustee or custodian for the account of the transferee or the transferee’s ancestors, descendants, or spouse. This subdivision shall apply, commencing January 1, 1987, to any member in existence prior to January 1, 1982. All other members shall be subject to this subdivision on and after January 1, 1982. (c) If the total amount in the fund (less any then unpaid demand made by the commissioner pursuant to Section 18492) on March 15 of any year is less than 11/2 percent of the total outstanding thrift obligations of all members, other than special members, as shown on the most recent independent audit reports required by Section 18405, then on or before May 1 of that year Guaranty Corporation shall levy an assessment. Each member, other than a special member, shall be assessed an amount equal to fifteen-hundredths of 1 percent of its outstanding thrift obligations as shown on its most recent independent audit report required by Section 18405. Guaranty Corporation may levy this assessment quarterly, based on members’ quarterly reports, at one quarter of the annual assessment rate authorized by this subdivision. (d) If the total amount in the fund (less any then unpaid demand made by the commissioner pursuant to Section 18492) on March 15 of any year hereafter is equal to or in excess of 11/2 percent of the total outstanding thrift obligations of all members, other than special members, as shown on the most recent independent audit reports required by Section 18405, then on or before May 1 of that year Guaranty Corporation shall levy an assessment on each member, other than a special member, that has not fulfilled both the following conditions as of March 15 of that year: (1) Paid total cumulative assessment payments to Guaranty Corporation exceeding in the aggregate 11/2 percent of the total outstanding thrift obligations of that member shown on its most recent independent audit report required by Section 18405; (2) Has a member’s account balance in Guaranty Corporation exceeding 11/2 percent of the total outstanding thrift obligations of that member shown on its most recent independent audit report required by Section 18405. Each member who has failed to fulfill both the preceding conditions as of March 15 of that year shall be assessed an amount equal to fifteen-hundredths of 1 percent of its outstanding thrift obligations as shown on its most recent independent audit report required by Section 18405. (e) If two members merge prior to May 1 of any year, the surviving member shall be liable for the assessment of the disappearing member that would have been payable to Guaranty Corporation pursuant to subdivision (c) or (d) had the merger not occurred prior to May 1. (Amended by Stats. 1985, Ch. 142, Sec. 34.5. Effective July 1, 1985.)
  192. 18536.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Assessments [18535 - 18538] ( Article 4 added by Stats. 1976, Ch. 964. )

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    Guaranty Corporation must send each assessed member a written notice of assessment within 10 days after the assessment is levied, and each assessed member must pay the assessed amount within 90 days after that notice.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Assessments [18535 - 18538] ( Article 4 added by Stats. 1976, Ch. 964. ) ## 18536. Guaranty Corporation shall send a written notice of assessment to each member assessed within 10 days after the levy of any assessment. Amounts assessed shall be paid to Guaranty Corporation by each member assessed not later than 90 days following written notice of assessment. (Added by Stats. 1976, Ch. 964.)
  193. 18538.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Assessments [18535 - 18538] ( Article 4 added by Stats. 1976, Ch. 964. )

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    If a member misses an assessment, Guaranty Corporation must notify the commissioner and the member within 24 hours, suspend the member’s membership rights, stop the member from selling or issuing investment certificates until arrears are paid, and start an enforcement action within 30 days.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 7. Guarantee of Thrift Accounts [18475 - 18538] ( Chapter 7 added by Stats. 1976, Ch. 964. ) ## ARTICLE 4. Assessments [18535 - 18538] ( Article 4 added by Stats. 1976, Ch. 964. ) ## 18538. In the event any member fails to pay an assessment when due, Guaranty Corporation shall report such default in writing to the commissioner and the defaulting member within 24 hours of such default and thereafter the rights and benefits of membership of such defaulting member in Guaranty Corporation shall be suspended and the defaulting member shall not be authorized to sell or issue its investment certificates in any form until all delinquent assessments are paid in full; provided, however, that the thrift obligations of the defaulting member shall continue to be protected as provided in this chapter. Within 30 days after default, Guaranty Corporation shall bring an action in law or in equity to enforce payment. If Guaranty Corporation does not bring such action within the time specified, the commissioner may bring an action in law or in equity to enforce such payment. Upon payment of all sums due, the member shall be reinstated and thereafter may sell and issue its investment certificates. (Amended by Stats. 1983, Ch. 87, Sec. 2.)
  194. 1854.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 21. International and Foreign Banking and Financing [1850 - 1910] ( Chapter 21 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. International and Foreign Banking and Financing Corporations [1850 - 1897] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. )

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    A corporation must submit its articles of incorporation to the commissioner for approval before filing them with the Secretary of State, then file a certified copy of the articles and later a certified copy of its bylaws with the commissioner.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 21. International and Foreign Banking and Financing [1850 - 1910] ( Chapter 21 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. International and Foreign Banking and Financing Corporations [1850 - 1897] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1854. The articles of incorporation shall be submitted to the commissioner for his or her approval before they are filed with the Secretary of State pursuant to the Corporations Code. After the articles have been filed with the Secretary of State the corporation shall file with the commissioner a copy thereof, certified by the Secretary of State, and, after the organization meeting of the directors, a copy of its bylaws certified by its secretary. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  195. 1855.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 21. International and Foreign Banking and Financing [1850 - 1910] ( Chapter 21 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. International and Foreign Banking and Financing Corporations [1850 - 1897] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. )

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    Corporations covered by this section may carry out specified international and foreign banking activities, subject to rules and approvals from the commissioner.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 21. International and Foreign Banking and Financing [1850 - 1910] ( Chapter 21 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. International and Foreign Banking and Financing Corporations [1850 - 1897] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1855. Each corporation shall have power, under such rules and regulations as the commissioner may prescribe: (a) To purchase, sell, discount, and negotiate, with or without its endorsement or guaranty, notes, drafts, checks, bills of exchange, acceptances, including bankers’ acceptances, cable transfers, and other evidences of indebtedness; to purchase and sell, with or without its endorsement or guaranty, securities, including the obligations of the United States or of any state thereof but not including shares of stock in any corporation except as herein provided; to accept bills or drafts drawn upon it subject to such limitations and restrictions as the commissioner may impose; to issue letters of credit; to purchase and sell coin, bullion, and exchange; to borrow and to lend money; to issue debentures, bonds, and promissory notes under such general conditions as to security and such limitations as the commissioner may prescribe; to receive deposits outside of the United States and to receive only such deposits in this state or in any other state of the United States as may be incidental to or for the purpose of carrying out transactions in foreign countries or dependencies or insular possessions of the United States. (b) Generally, to exercise such powers as are incidental to the powers conferred by this article or as may be usual, in the determination of the commissioner, in connection with the transaction of the business of banking or other financial operations in the countries, colonies, dependencies, or possessions in which it shall transact business and not inconsistent with the power specifically granted herein. Nothing contained in this article shall be construed to prohibit the commissioner, under his or her power to prescribe rules and regulations, from limiting the aggregate amount of liabilities of any or all classes incurred by the corporation and outstanding at any one time. (c) To establish and maintain for the transaction of its business branches or agencies in foreign countries, their dependencies or colonies, and in any state of the United States, and in the dependencies or insular possessions of the United States, at such places as may be approved by the commissioner and under such rules and regulations as he or she may prescribe, including any state of the United States, or countries or dependencies not specified in the original organization certificate. (d) With the consent of the commissioner to purchase and hold stock or other certificates of ownership in any other corporation organized under the laws of this state for the purpose of transacting business pursuant to this article, or under the laws of the United States, or under the laws of any foreign country or a colony of dependency thereof, or under the laws of any state, dependency or insular possession of the United States but not engaged in the general business of buying or selling goods, wares, merchandise, or commodities in the United States, and not transacting any business in the United States except such as in the judgment of the commissioner may be incidental to its international or foreign business. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  196. 1856.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 21. International and Foreign Banking and Financing [1850 - 1910] ( Chapter 21 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. International and Foreign Banking and Financing Corporations [1850 - 1897] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. )

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    A corporation generally may not invest more than 10% of its shareholders’ equity in any one corporation unless the commissioner approves; investments in a banking corporation may go up to 15%.

    ## Financial Code - FIN ## DIVISION 1.1. BANKING [1000 - 1910] ( Division 1.1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## CHAPTER 21. International and Foreign Banking and Financing [1850 - 1910] ( Chapter 21 added by Stats. 2011, Ch. 243, Sec. 3. ) ## ARTICLE 1. International and Foreign Banking and Financing Corporations [1850 - 1897] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 3. ) ## 1856. Except with the approval of the commissioner, no corporation shall invest in any one corporation an amount in excess of 10 percent of its own shareholders’ equity, except in a corporation engaged in the business of banking, when 15 percent of its shareholders’ equity may be so invested. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)
  197. 18560.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 8. Insurance Premium Financing [18560 - 18643] ( Chapter 8 added by Stats. 1976, Ch. 964. ) ## ARTICLE 1. Definitions [18560 - 18567] ( Article 1 added by Stats. 1976, Ch. 964. )

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    This section defines “premium finance agency.”

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 8. Insurance Premium Financing [18560 - 18643] ( Chapter 8 added by Stats. 1976, Ch. 964. ) ## ARTICLE 1. Definitions [18560 - 18567] ( Article 1 added by Stats. 1976, Ch. 964. ) ## 18560. “Premium finance agency” means any industrial loan company incorporated under this division which, by the terms of its authority to engage in the industrial loan business, is permitted to issue or sell investment certificates subject to the limitations set forth in Section 18596 and its business is limited to that set forth in this chapter. (Added by Stats. 1976, Ch. 1296.)
  198. 18561.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 8. Insurance Premium Financing [18560 - 18643] ( Chapter 8 added by Stats. 1976, Ch. 964. ) ## ARTICLE 1. Definitions [18560 - 18567] ( Article 1 added by Stats. 1976, Ch. 964. )

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    Insurance-related terms used in this chapter are given the meaning set by the Insurance Code and insurance business practices.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 8. Insurance Premium Financing [18560 - 18643] ( Chapter 8 added by Stats. 1976, Ch. 964. ) ## ARTICLE 1. Definitions [18560 - 18567] ( Article 1 added by Stats. 1976, Ch. 964. ) ## 18561. Such terms relating to insurance as are used in this chapter shall have the meaning ascribed to them in the Insurance Code and in the practices of the insurance business. (Added by Stats. 1976, Ch. 964.)
  199. 18562.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 8. Insurance Premium Financing [18560 - 18643] ( Chapter 8 added by Stats. 1976, Ch. 964. ) ## ARTICLE 1. Definitions [18560 - 18567] ( Article 1 added by Stats. 1976, Ch. 964. )

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    This section defines “insured” for this chapter.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 8. Insurance Premium Financing [18560 - 18643] ( Chapter 8 added by Stats. 1976, Ch. 964. ) ## ARTICLE 1. Definitions [18560 - 18567] ( Article 1 added by Stats. 1976, Ch. 964. ) ## 18562. As used in this chapter, “insured” means the person who has purchased or arranged to purchase an insurance contract and who enters into a premium finance agreement with a premium finance agency. (Added by Stats. 1976, Ch. 964.)
  200. 18563.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 8. Insurance Premium Financing [18560 - 18643] ( Chapter 8 added by Stats. 1976, Ch. 964. ) ## ARTICLE 1. Definitions [18560 - 18567] ( Article 1 added by Stats. 1976, Ch. 964. )

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    This section defines “premium financing” and says the advanced amount must have a reasonable relationship to the premium being financed.

    ## Financial Code - FIN ## DIVISION 7. INDUSTRIAL LOAN COMPANIES [18000 - 18707] ( Division 7 repealed and added by Stats. 1976, Ch. 964. ) ## CHAPTER 8. Insurance Premium Financing [18560 - 18643] ( Chapter 8 added by Stats. 1976, Ch. 964. ) ## ARTICLE 1. Definitions [18560 - 18567] ( Article 1 added by Stats. 1976, Ch. 964. ) ## 18563. As used in this chapter, “premium financing” means the activities of a company engaging in the business of advancing money directly or indirectly to an insurer or producer at the request of an insured pursuant to the terms of a premium finance agreement, wherein the insured has assigned the unearned premiums, accrued dividends or loss payments as security for such advancement in payment of premiums on insurance contracts only, and acquiring premium finance agreements, and does not include the financing of insurance contract premiums purchased in connection with the financing of goods and services. The amount of such advancement in payment of premiums must bear a reasonable relationship to the premium or premiums being financed. (Amended by Stats. 1998, Ch. 827, Sec. 16. Effective January 1, 1999.)

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