2007 California Financial Code Article 3. Banking Business By Unauthorized Persons

CA Codes (fin:3390-3397)

3390.  No person which has not received a certificate from the
commissioner authorizing it to engage in the banking business shall
solicit or receive deposits, issue certificates of deposit with or
without provision for interest, make payments on check, or transact
business in the way or manner of a commercial bank, industrial bank,
or trust company.



3391.  No person which has not received a certificate from the
commissioner authorizing it to engage in the banking business shall
advertise that it is accepting deposits, and issuing notes or
certificates therefor, or make use of any office sign, at the place
where its business is transacted, having thereon any artificial or
corporate name, or other words indicating that the place or office is
the place or office of a bank or trust company, that deposits are
received there or payments made on check, or any other form of
banking business is transacted, nor shall any person make use of or
circulate any letterheads, billheads, blank notes, blank receipts,
certificates, or circulars, or any written or printed paper,
whatever, having thereon any artificial or corporate name or other
words indicating that the business is the business of a bank or trust
company, or transact business in a way or manner as to lead the
public to believe that its business is that of a bank or trust
company, except to the extent expressly authorized by this division.




3392.  No person which has not received a certificate from the
commissioner authorizing it to engage in the banking business shall
transact business under any name or title which contains the word
"bank" or "banker" or "banking" or "industrial bank" or "industrial
loan company" or "investment and loan" or "savings bank" or "thrift
and loan" or "trust" or "trustee" or "trust company" and which
indicates that the business is the business of a bank or trust
company.  Any building and loan association or savings association
having in its corporate name words not clearly indicating the nature
of its business shall state, on all signs, letterheads, and
advertising matter, "This is a building and loan association" or
"This is a savings association" or words to that effect.



3392.5.  No provision of Section 3390, 3391, or 3392 prohibits any
of the following from transacting any business or performing any
activity if it is authorized by applicable law to transact the
business or perform the activity and is not prohibited by any
applicable law (other than Sections 3390, 3391, and 3392) from
transacting the business or performing the activity:
   (a) Any California state commercial bank, industrial bank, or
trust company.
   (b) Any national bank.
   (c) Any insured foreign (other state) state bank.
   (d) Any foreign (other state) state bank that is licensed by the
commissioner under Article 4 (commencing with Section 3860) of
Chapter 22 to maintain a facility (as defined in Section 3800) in
this state.
   (e) Any foreign (other nation) bank that is licensed by the
commissioner under Chapter 13.5 (commencing with Section 1700) to
maintain an office in this state.
   (f) Any foreign (other nation) bank that maintains a federal
agency (as defined in subdivision (g) of Section 1700) or federal
branch (as defined in subdivision (h) of Section 1700) in this state.

   (g) Any California state corporation that is incorporated for the
purpose of engaging in, and that is authorized by the commissioner to
engage in, business under Article 1 (commencing with Section 3500)
of Chapter 19.
   (h) Any corporation incorporated under Section 25A of the Federal
Reserve Act (12 U.S.C. Sec. 612 et seq.).
   (i) Any foreign corporation that is licensed by the commissioner
under Article 1 (commencing with Section 3500) of Chapter 19 to
maintain an office in this state and to transact at that office
business under Article 1 (commencing with Section 3500) of Chapter
19.
   (j) Any industrial bank that is organized under the laws of
another state of the United States and is insured by the Federal
Deposit Insurance Corporation.



3393.  Any building and loan association may issue shares and
investment certificates and do such other business as may be
authorized by the laws of the State relating to building and loan
associations, but no building and loan association shall advertise or
hold itself out to the public as a savings bank.



3395.  Any person or any bank violating any provision of the
foregoing sections of this article shall be liable to the people of
the state in the amount of one hundred dollars (0) a day or part
thereof during which that violation continues.




3396.  No person shall represent by advertisement, circular, or
otherwise, or in any manner mislead anyone to believe, that any
securities are legal investments for savings banks in this state or
conform to the requirements of law relating to such investments,
unless such securities are in fact at such time legal investments for
such banks or do in fact so conform to such requirements or, unless
such person, in making such representation, has acted in good faith
and in reliance upon a certificate issued by the commissioner
pursuant to Section 1371 issued within one year, upon published
reports of the public or private corporations issuing such
securities, upon information furnished by a public official in his or
her official capacity or upon information furnished by any
established statistical agency approved for this purpose by the
commissioner.  Any person violating the provisions of this section
shall be guilty of a misdemeanor and shall be punishable by a fine of
not more than one thousand dollars (,000) or by imprisonment in a
county jail not exceeding one year, or by both such fine and
imprisonment.



3397.  It shall be unlawful for any person who solicits funds for
deposit in any bank in this state to knowingly enter into any
agreement with the bank or a borrower whereby a depositor directly or
indirectly receives monetary compensation or interest payments which
exceed the legal maximum payable as interest for the deposit.