2007 California Financial Code Article 3. Licensing

CA Codes (fin:22100-22112)

22100.  No person shall engage in the business of a finance lender
or broker without obtaining a license from the commissioner.



22101.  (a) An application for a license under this division shall
be in the form and contain the information that the commissioner may
by rule require and shall be filed upon payment of the fee specified
in Section 22103.
   (b) Notwithstanding any other provision of law, an applicant who
does not currently hold a license under this division shall furnish
with his or her application, a full set of fingerprints and related
information for purposes of the commissioner conducting a criminal
history record check. The commissioner shall obtain and receive
criminal history information from the Department of Justice and the
Federal Bureau of Investigation pursuant to Section 22101.5.
   (c) Nothing in this section shall be construed to prevent a
licensee from engaging in the business of a finance lender through a
subsidiary corporation if the subsidiary corporation is licensed
pursuant to this division.
   (d) For purposes of this section, "subsidiary corporation" means a
corporation that is wholly owned by a licensee.
   (e) A new application shall not be required for a change in the
address of an existing location previously licensed under this
division. However, the licensee shall comply with the requirements of
Section 22153.


22101.5.  (a) The commissioner shall submit to the Department of
Justice fingerprint images and related information required by the
Department of Justice of all license candidates, as defined by
subdivision (a) of Section 22101, for purposes of obtaining
information as to the existence and content of a record of state or
federal convictions, state or federal arrests, and information as to
the existence and content of a record of state or federal arrests for
which the Department of Justice establishes that the person is free
on bail or on his or her own recognizance pending trial or appeal.
   (b) When received, the Department of Justice shall forward to the
Federal Bureau of Investigation requests for federal summary criminal
history information received pursuant to this section. The
Department of Justice shall review the information returned from the
Federal Bureau of Investigation and compile and disseminate a
response to the commissioner.
   (c) The Department of Justice shall provide a response to the
commissioner pursuant to paragraph (1) of subdivision (p) of Section
11105 of the Penal Code.
   (d) The commissioner shall request from the Department of Justice
subsequent arrest notification service, as provided pursuant to
Section 11105.2 of the Penal Code, for license candidates described
in subdivision (a).
   (e) The Department of Justice shall charge a fee sufficient to
cover the costs of processing the requests pursuant to this section.

   (f) This section shall become operative on July 1, 2006.




22102.  (a) A licensee seeking to engage in business at a new
location shall submit an application to the commissioner by certified
mail, return receipt requested, at least 10 days before engaging in
business at a new location and pay the fee required by Section 22103.

   (b) The commissioner, by regulation, shall adopt a form for the
application required by this section. The application shall contain
the following information:
   (1) The address of the new location.
   (2) Information on the person responsible for the lending activity
at the new location.
   (3) Any additional information required by the commissioner.
   (c) The licensee may engage in business at the new location 10
days after the date of mailing the application to engage in business
at that location.
   (d) (1) The commissioner shall approve or deny the person
responsible for the lending activity at the new location in
accordance with Section 22109, and shall notify the licensee of this
decision within 90 days of the date of receipt of the application.
   (2) If the commissioner denies the application, the licensee
shall, within 10 days of the date of receipt of notification of the
commissioner's denial, submit a new application to the commissioner
designating a different person responsible for the lending activity
at the new location. The commissioner shall approve or deny the
different person as provided in paragraph (1).
   (e) A licensee shall not engage in business at a new location in a
name other than a name approved by the commissioner.
   (f) The commissioner may adopt regulations to implement the
requirements of this section.
   (g) A license to engage in business at a new location shall be
issued in accordance with this section. A change of street address of
a place of business designated in a license shall be made in
accordance with Section 22153 and shall not constitute a new location
subject to the requirements of this section.



22103.  At the time of filing the application, the applicant shall
pay to the commissioner the sum of one hundred dollars (0) as a
fee for investigating the application, plus the cost of fingerprint
processing and the criminal history record check under Section
22101.5, and two hundred dollars (0) as an application fee. The
investigation fee, including the amount for the criminal history
record check, and the application fee are not refundable if an
application is denied or withdrawn.



22104.  The applicant shall file with the application financial
statements prepared in accordance with generally accepted accounting
principles and acceptable to the commissioner that indicate a net
worth of at least twenty-five thousand dollars (,000).  A licensee
shall maintain a net worth of at least twenty-five thousand dollars
(,000) at all times.



22105.  Upon the filing of an application pursuant to Section 22101
and the payment of the fees, the commissioner shall investigate the
applicant and its general partners and persons owning or controlling,
directly or indirectly, 10 percent or more of the outstanding
interests or any person responsible for the conduct of the applicant'
s lending activities in this state, if the applicant is a
partnership. If the applicant is a corporation, trust, limited
liability company, or association, including an unincorporated
organization, the commissioner shall investigate the applicant, its
principal officers, directors, managing members, and persons owning
or controlling, directly or indirectly, 10 percent or more of the
outstanding equity securities or any person responsible for the
conduct of the applicant's lending activities in this state. Upon the
filing of an application pursuant to Section 22102 and the payment
of the fees, the commissioner shall investigate the person
responsible for the lending activity of the licensee at the new
location described in the application. The investigation may be
limited to information that was not included in prior applications
filed pursuant to this division. If the commissioner determines that
the applicant has satisfied this division and does not find facts
constituting reasons for denial under Section 22109, the commissioner
shall issue and deliver a license to the applicant.
   For the purposes of this section, "principal officers" shall mean
president, chief executive officer, treasurer, and chief financial
officer, as may be applicable, and any other officer with direct
responsibility for the conduct of the applicant's lending activities
within the state.



22106.  (a) The license shall state the name of the licensee, and if
the licensee is a partnership, the names of its general partners,
and if a corporation or an association, the date and place of its
incorporation or organization, and the address of the licensee's
principal business location. On the approval and licensing of a
location pursuant to Section 22101 or 22102, the commissioner shall
issue an original license endorsed to show the address of the
authorized location and, if applicable, the name of the subsidiary
corporation licensed to operate the location.  The license shall
state whether the licensee is licensed as a finance lender or a
broker.
   (b) A license for a business location outside this state may be
issued if the licensee agrees in writing in the license application
to do, at the option of the applicant, one of the following:
   (1) Make the licensee's books, accounts, papers, records, and
files available to the commissioner or the commissioner's
representatives in this state.
   (2) Pay the reasonable expenses for travel, meals, and lodging of
the commissioner or the commissioner's representatives incurred
during any investigation or examination made at the licensee's
location outside this state.
   A licensee located outside this state is not required to maintain
books and records regarding licensed loans separate from those for
other loans if the licensed loans can be readily identified.




22107.  (a) Each licensee shall pay to the commissioner its pro rata
share of all costs and expenses reasonably incurred in the
administration of this division, as estimated by the commissioner,
for the ensuing year and any deficit actually incurred or anticipated
in the administration of the program in the year in which the
assessment is made.  The pro rata share shall be the proportion that
a licensee's  gross income bears to the aggregate gross income of all
licensees as shown by the annual financial reports to the
commissioner, for the costs and expenses remaining after the amount
assessed pursuant to subdivision (c).
   (b) On or before the 30th day of May in each year, the
commissioner shall notify each licensee by mail of the amount
assessed and levied against it and that amount shall be paid within
20 days thereafter.  If payment is not made within 20 days, the
commissioner shall assess and collect a penalty, in addition to the
assessment, of 1 percent of the assessment for each month or part of
a month that the payment is delayed or withheld.
   (c) In the levying and collection of the assessment, a licensee
shall neither be assessed for nor be permitted to pay less than two
hundred fifty dollars (0) per licensed location per year.
   (d) If a licensee fails to pay the assessment on or before the
30th day of June following the day upon which payment is due, the
commissioner may by order summarily suspend or revoke the certificate
issued to the licensee.  If, after an order is made, a request for
hearing is filed in writing within 30 days, and a hearing is not held
within 60 days thereafter, the order is deemed rescinded as of its
effective date.  During any period when its certificate is revoked or
suspended, a licensee shall not conduct business pursuant to this
division except as may be permitted by order of the commissioner.
However, the revocation, suspension, or surrender of a certificate
shall not affect the powers of the commissioner as provided in this
division.



22108.  The commissioner may by regulation require licensees to
file, at the times that he or she may specify, the information that
he or she may reasonably require regarding any changes in the
information provided in any application filed pursuant to this
division.



22109.  (a) Upon reasonable notice and opportunity to be heard, the
commissioner may deny the application for any of the following
reasons:
   (1) A false statement of a material fact has been made in the
application.
   (2) The applicant or an officer, director, general partner, person
responsible for the applicant's lending activities in this state, or
person owning or controlling, directly or indirectly, 10 percent or
more of the outstanding interests or equity securities of the
applicant has, within the last 10 years, been convicted of or pleaded
nolo contendere to a crime, or committed an act involving
dishonesty, fraud, or deceit, if the crime or act is substantially
related to the qualifications, functions, or duties of a person
engaged in business in accordance with this division.
   (3) The applicant or an officer, director, general partner, person
responsible for the applicant's lending activities in this state, or
person owning or controlling, directly or indirectly, 10 percent or
more of the outstanding interests or equity securities of the
applicant has violated any provision of this division or the rules
thereunder or any similar regulatory scheme of the State of
California or a foreign jurisdiction.
   (b) The application shall be considered withdrawn within the
meaning of this section if the applicant fails to respond to a
written notification of a deficiency in the application within 90
days of the date of the notification.
   (c) The commissioner shall, within 60 days from the filing of a
full and complete application for a license with the fees, either
issue a license or file a statement of issues prepared in accordance
with Chapter 5 (commencing with Section 11500) of Part 1 of Division
3 of Title 2 of the Government Code.



22110.  The proceedings for a denial of a license shall be conducted
in accordance with Chapter 5 (commencing with Section 11500) of Part
1 of Division 3 of Title 2 of the Government Code, and the
commissioner has all the powers granted therein.




22111.  All money paid or collected under this division shall be
deposited in the State Treasury to the credit of the State
Corporations Fund.  The administration of this division shall be
supported out of the State Corporations Fund.



22112.  (a) A licensee shall maintain a surety bond in accordance
with this subdivision in the amount of twenty-five thousand dollars
(,000). The bond shall be payable to the commissioner and issued
by an insurer authorized to do business in this state. An original
surety bond, including any and all riders and endorsements executed
subsequent to the effective date of the bond, shall be filed with the
commissioner within 10 days of execution. For licensees with
multiple licensed locations, only one surety bond is required. The
bond shall be used for the recovery of expenses, fines, and fees
levied by the commissioner in accordance with this division or for
losses or damages incurred by borrowers or consumers as the result of
a licensee's noncompliance with the requirements of this division.
   (b) When an action is commenced on a licensee's bond, the
commissioner may require the filing of a new bond. Immediately upon
recovery of any action on the bond, the licensee shall file a new
bond.  Failure to file a new bond within 10 days of the recovery on a
bond, or within 10 days after notification by the commissioner that
a new bond is required, constitutes sufficient grounds for the
suspension or revocation of the license.