2020 California Code
Financial Code - FIN
DIVISION 10 - CALIFORNIA DEFERRED DEPOSIT TRANSACTION LAW
CHAPTER 2 - Deferred Deposit Transactions
Section 23037.
In no case shall a licensee do any of the following:
(a) Accept or use the same check for a subsequent transaction, or permit a customer to pay off all or a portion of one deferred deposit transaction with the proceeds of another.
(b) Accept any collateral for a deferred deposit transaction.
(c) Make any deferred deposit transaction contingent on the purchase of insurance or any other goods or services.
(d) Enter into a deferred deposit transaction with a person lacking the capacity to contract.
(e) Alter the date or any other information on a check.
(f) Engage in any unfair, unlawful, or deceptive conduct, or make any statement that is likely to mislead in connection with the business of deferred deposit transactions.
(g) Accept more than one check for a single deferred deposit transaction.
(h) Take any check, instrument, or form in which blanks are left to be filled in after execution.
(i) Offer, arrange, act as an agent for, or assist a deferred deposit originator in any way in the making of a deferred deposit transaction unless the deferred deposit originator complies with all applicable federal and state laws and regulations, including the provisions of this division.
(1) The prohibition specified in this subdivision does not apply to the arranger, agent, or assistant to a state or federally chartered bank, thrift, savings association, or industrial loan company where the state or federally chartered bank, thrift, savings association, or industrial loan company satisfies all of the following:
(A) It initially advances the loan proceeds to the customer.
(B) It does not sell, assign, or transfer a preponderant economic interest in the deferred deposit transaction to the arranger, agent, or assistant, or an affiliate or subsidiary of the state or federally chartered bank, thrift, savings association, or industrial loan company, unless selling, assigning, or transferring a preponderant economic interest is expressly permitted by the primary regulator of the state or federally chartered bank, thrift, savings association, or industrial loan company.
(C) It develops the deferred deposit transaction product or products on its own.
(2) If a licensee offers, arranges, acts as an agent for, or assists a state or federally chartered bank, thrift, savings association, or industrial loan company in any way in the making of a deferred deposit transaction and the state or federally chartered bank, thrift, savings association, or industrial loan company meets the standards set forth in paragraph (1), the licensee shall comply with all other provisions in this division to the extent they are not preempted by other state and federal laws.
(Added by Stats. 2002, Ch. 777, Sec. 10. Effective January 1, 2003. Section operative on December 31, 2004, or sooner, pursuant to Section 23104.)
