CHAPTER 5. Administration and Powers of the Commissioner [18339. - 18427.11.]

Chapter 5 added by Stats. 1976, Ch. 964.

§§ 18339–18427.11 · 104 sections

1. ARTICLE 1. General §§ 18339–18368 · 31 sections

   • § 18339 As of the operative date of this section: (a) There is established an Industrial Loan Account in the Financial Institutions Fund in the State Treasury. (b) All…
   • § 18340 All money received or collected by the commissioner under this division or any other law relating to industrial loan companies or the industrial loan business…
   • § 18340.5 All expenses of the department in administering this division and other laws relating to industrial loan companies or the industrial loan business shall be…
   • § 18342 Industrial loan companies have the powers specified in this division. In addition, industrial loan companies have the general powers conferred upon…
   • § 18343 The commissioner may require an industrial loan company to establish and maintain reasonable reserves for loans made, and contracts or other obligations…
   • § 18344 An industrial loan company shall not conduct the business of making loans under this division, within any office, room, or place of business in which any other…
   • § 18345 An industrial loan company shall notify the commissioner of every change in the officers, directors and management personnel of the company and of each branch…
   • § 18346 The commissioner may require each industrial loan company to file with the commissioner a fidelity bond indemnifying the industrial loan company against loss…
   • § 18346.1 (a) In lieu of providing a bond required pursuant to Section 18346, a licensee may deposit with the commissioner security in an amount as the commissioner may…
   • § 18347 The commissioner may establish rules and regulations which are reasonable and necessary to carry out the purposes and provisions of this division, including…
   • § 18349 The commissioner may, upon reasonable notice and opportunity to be heard, suspend or revoke the license of an industrial loan company if the commissioner finds…
   • § 18349.5 (a) For the purposes of this section, the following definitions are applicable: (1) “Account holder” includes, in the case of an investment certificate…
   • § 18350 Each industrial loan company shall pay to the commissioner its pro rata share of all costs and expenses of the department in administering this division and…
   • § 18351 On or before the 30th day of November in each year, the commissioner shall notify each industrial loan company by mail of the amount assessed and levied…
   • § 18352 In the levying and collection of an assessment pursuant to Section 18350, an industrial loan company shall not be assessed for nor be permitted to pay less…
   • § 18353 If an industrial loan company fails to pay the assessment provided in Section 18350 on or before the 30th day of December following the day upon which payment…
   • § 18354 The commissioner may require the attendance of witnesses and examine under oath all persons whose testimony he requires relative to the affairs of an…
   • § 18355 Whenever, after an examination, investigation or hearing under this division, the commissioner deems it of public interest or advantage, he may certify a…
   • § 18356 The commissioner may order any industrial loan company to desist from any conduct which the commissioner finds in violation of this division or any rule or…
   • § 18357 (a) If it appears to the commissioner that an industrial loan company has violated or failed to comply with the provisions of its articles of incorporation, or…
   • § 18358 If it appears to the commissioner that an industrial loan company is conducting business in an unsafe, unsound, or injurious manner, the commissioner may, by…
   • § 18359 Whenever the commissioner is authorized to issue an order pursuant to Section 18357 or Section 18358 of this division, the commissioner may issue an order…
   • § 18360 The company named in any order issued pursuant to this division for which no express hearing right is provided, including Sections 18356, 18357, 18358, 18359,…
   • § 18361 After any order is made final, the industrial loan company shall have 10 days in which suit may be commenced to restrain enforcement of such order and unless…
   • § 18362 (a) If the commissioner believes that an industrial loan company or its directors, officers, agents, or employees have violated or are about to violate any of…
   • § 18363 The commissioner may order an industrial loan company to suspend the redemption of investment certificates or the payment of the liabilities of the company or…
   • § 18364 After an order of suspending or limiting the payment of liabilities is effective and until that order is rescinded, the industrial loan company shall make no…
   • § 18365 The authority granted to the commissioner by Section 18363, may be exercised by him in conjunction with all other powers granted by this chapter, or…
   • § 18366 Every order, decision, license, or other official act of the commissioner is subject to review in accordance with law. Upon review, the burden of proof lies…
   • § 18367 (a) If at any time the commissioner is of the opinion that the further sale of investment certificates by an industrial loan company would be unfair, unjust or…
   • § 18368 (a) The commissioner may make the agreements that he or she deems necessary or appropriate in exercising his or her powers. (b) (1) The agreements authorized…
2. ARTICLE 2. Examinations §§ 18390–18396 · 6 sections

   • § 18390 For the purpose of discovering violations of this division or securing information required, the commissioner may at any time investigate the affairs and…
   • § 18391 Whenever in the judgment of the commissioner the condition of any industrial loan company renders it necessary or expedient to devote any extraordinary…
   • § 18392 The industrial loan company examined shall pay to the commissioner the cost of any examination, investigation or services, including the salary or other…
   • § 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…
   • § 18394 Investigation and examination reports prepared by the commissioner’s duly designated representatives shall not be public records. Those reports may be…
   • § 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…
3. ARTICLE 3. Reports and Financial Statements §§ 18405–18412 · 8 sections

   • § 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…
   • § 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…
   • § 18407 An industrial loan company shall, when requested by the commissioner, submit its unaudited financial statements, prepared in accordance with generally accepted…
   • § 18408 An industrial loan company shall make other special reports to the commissioner as the commissioner may from time to time require.
   • § 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…
   • § 18410 For the purposes of the composite report provided for by Section 18409, an industrial loan company shall furnish statistical information as is reasonably…
   • § 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…
   • § 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…
4. ARTICLE 4. Possession, Conservatorship, and Liquidation by the Commissioner §§ 18415–18425.17 · 47 sections

   • § 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…
   • § 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…
   • § 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…
   • § 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…
   • § 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…
   • § 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…
   • § 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…
   • § 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…
   • § 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…
   • § 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…
   • § 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…
   • § 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…
   • § 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…
   • § 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…
   • § 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…
   • § 18415.15 The commissioner may make examinations of the seized company and review the activities of any conservator or liquidator.
   • § 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…
   • § 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…
   • § 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…
   • § 18415.19 All expenses of taking possession of, conserving, conducting, liquidating, disposing of or otherwise dealing with the business and property of any company…
   • § 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…
   • § 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…
   • § 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.
   • § 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…
   • § 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…
   • § 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…
   • § 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…
   • § 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…
   • § 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…
   • § 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…
   • § 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…
   • § 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…
   • § 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…
   • § 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…
   • § 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…
   • § 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…
   • § 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,…
   • § 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,…
   • § 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…
   • § 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…
   • § 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…
   • § 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…
   • § 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,…
   • § 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,…
   • § 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,…
   • § 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…
   • § 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…
5. ARTICLE 5. Securities Transactions §§ 18427–18427.11 · 12 sections

   • § 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…
   • § 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…
   • § 18427.2 An application for a permit shall be in such form and contain such information as the commissioner may prescribe.
   • § 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…
   • § 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…
   • § 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…
   • § 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…
   • § 18427.7 The commissioner may amend, alter, suspend, or revoke any permit issued pursuant to Section 18427.4.
   • § 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…
   • § 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…
   • § 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…
   • § 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…