2007 California Financial Code Article 2. Sale Of Payment Instruments

CA Codes (fin:33520-33525)

33520.  (a) No licensee shall engage in the business of selling in
this state payment instruments issued by it, except as follows:
   (1) Directly, either through officers and employees of such
licensee, acting as such at offices of the licensee located in this
state or through machines located in this state which are operated by
the licensee; and
   (2) Indirectly, through California agents of the licensee.
   (b) No licensee shall cause or permit any person to engage in the
business of selling in this state payment instruments issued by such
licensee, except California agents of the licensee.



33521.  (a) No licensee shall, nor shall any licensee cause or
permit any of its California agents to, sell in this state any
payment instrument issued by the licensee unless all of the following
are satisfied:
   (1) The payment instrument clearly identifies the licensee as the
issuer of the payment instrument.
    (2) The payment instrument is not misleading in any material
respect.
    (3) The payment instrument complies with all applicable laws.
   (b) Before a new licensee issues its first payment instrument for
sale in this state, it shall file a certified copy of the form of
that payment instrument with the commissioner.




33522.  (a) No licensee shall, nor shall any licensee cause or
permit any of its California agents to, sell in this state any
payment instrument issued by such licensee which is drawn on or is
payable through or at a bank, unless such bank shall have first been
approved for such purpose by the commissioner.
   (b) If the commissioner finds, with respect to an application by a
licensee for approval of a bank as a drawee, payable through, or
payable at bank for payment instruments to be issued by such
licensee, that it will be safe and sound for payment instruments
issued by the licensee to be drawn on, payable through, or payable
at, such bank, the commissioner shall approve the application and
shall, when all conditions precedent to the approval of the bank as a
drawee, payable through, or payable at bank have been fulfilled,
approve the bank as a drawee, payable through, or payable at bank for
payment instruments to be issued by the licensee.  If after notice
and a hearing, the commissioner finds otherwise, the commissioner
shall deny the application.



33523.  No licensee or California agent of a licensee shall, nor
shall any licensee cause or permit any of its agents to, sell any
payment instrument issued by the licensee without concurrently
receiving or, in the case of a sale to an insured bank, an insured
savings and loan association, or an insured credit union, by the next
business day after the sale, in consideration of such sale any of
the following or any combination of the following in an aggregate
amount not less than the face amount of such payment instrument:
   (a) Cash or its equivalent.
   (b) Payment instrument, check, or draft believed to be
collectible.
   (c) Credit card voucher believed to be collectible.



33524.  Each licensee shall be liable as a maker in accordance with
the California Uniform Commercial Code with respect to each payment
instrument issued by it which is sold in this state by it, directly
or indirectly through a California agent.



33525.  Each licensee or agent of the licensee shall prominently
post on the premises of each office of the licensee or agent of the
licensee located in this state, and at machines located in this state
that issue payment instruments and are operated by the licensee or
agent of the licensee, a notice clearly stating that payment
instruments issued by the licensee or agent of the licensee are not
insured by the federal government, the state government, or any other
public or private entity.  This notice shall be printed in English
and in the same language principally used by the licensee or any
agent of the licensee to advertise, solicit, or negotiate, either
orally or in writing, with respect to the purchase of payment
instruments.  The information required in this notice shall be clear,
legible, and in letters not less than one-half inch in height.  The
notice shall be posted in a conspicuous location in the unobstructed
view of the public within the premises.  In those locations operated
by an agent of the licensee, the agent, and not the licensee, shall
be responsible for the failure to properly post the required notice.