California Financial Code 7450.2 – Except with the prior written consent of the commissioner, no …
Except with the prior written consent of the commissioner, no association shall knowingly make:
(a) Any loan to any corporation of which 10 percent or more of the stock is owned or controlled individually or collectively by any one or more of the directors, officers, employees, or substantial stockholders of the association.
Terms Used In California Financial Code 7450.2
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Person: includes any person, firm, partnership, association, corporation, company, limited liability company, syndicate, estate, trust, business trust, or organization of any kind. See California Financial Code 18
As used in this subdivision, “substantial stockholder” means a person who has a real or beneficial ownership of more than 10 percent of the outstanding stock of the association. For this purpose, stock owned by the person’s immediate family shall be deemed owned by that person.
(b) Any loan the proceeds of which are intended to inure to the benefit of any corporation specified in subdivision (a).
(Added by Stats. 1986, Ch. 1158, Sec. 6. Effective September 26, 1986.)