State Codes and Statutes

Statutes > California > Fin > 295-302.3

FINANCIAL CODE
SECTION 295-302.3



295.  In this article:
   (a) "Appropriate licensee business" means the business that a
licensee may conduct in accordance with the charter or license that
the commissioner has issued to that licensee.
   (b) "Customer" means a depositor of a bank, a member of a credit
union, or a customer of any other licensee.
   (c) "Holding company" shall have the meaning set forth in Section
3700.
   (d) "Officer of a subject institution" means any director,
officer, official, or employee of the subject institution.
   (e) "Person" means a subject institution or a subject person.
   (f) "Subject institution" means any of the following:
   (1) Licensee.
   (2) Subsidiary of a licensee.
   (3) Foreign (other state) or foreign (other nation) bank or credit
union that maintains an office in this state, with respect to any
such office other than a national bank or federal credit union.
   (4) Any other person lawfully conducting the business of a bank or
credit union in this state other than a national bank or federal
credit union.
   (g)  "Subject person," when used with respect to a subject
institution, means any of the following:
   (1) Director, officer, employee, or agent of the subject
institution.
   (2) Member, consultant, joint venture partner, or other person
that participates in the affairs of a subject institution.
   (3) Independent contractor, including any attorney, appraiser, or
accountant, who knowingly or recklessly participates in any of the
following acts if the act caused or is likely to cause more than a
minimal financial loss to, or a significant adverse effect on, the
subject institution:
   (A) A violation of any applicable law, regulation, or order.
   (B) A breach of fiduciary duty.
   (C) An unsafe or unsound act.
   (h)  "Violation" includes any act performed, alone or with other
persons, for or toward causing, bringing about, participating in,
counseling, aiding, or abetting a violation of any applicable
statute, regulation, provision of a written order issued by the
commissioner, or provision of a written agreement made between the
commissioner and a subject institution or subject person.



295.1.  Any subject person who is entitled to a hearing pursuant to
this article may waive that right at any time. A waiver under this
section shall relieve the commissioner from having to issue a formal
notice of hearing that would otherwise be required by this article.



295.2.  (a) Within 30 days after an order is issued pursuant to
Section 297, 298.1, 299, 300.1, or 301.1, or subdivision (c) of
Section 300.2, the person to whom the order is issued may file with
the commissioner an application for a hearing on the order.
   (b) If the commissioner fails to commence the hearing within 15
business days after the application is filed with the commissioner or
within any longer period to which the person subject to the order
consents, the order shall be deemed rescinded.
   (c) Within 30 days after the hearing, or within any longer period
to which the person consents, the commissioner shall affirm, modify,
or rescind the order. If the commissioner fails to affirm, modify, or
rescind the order within that time limit, the order shall be deemed
rescinded.
   (d) The right to petition for judicial review of the order shall
not be affected by the failure of the person subject to the order to
apply to the commissioner for a hearing on the order pursuant to
subdivision (a).


295.3.  In addition to any other action or requirement the
commissioner deems necessary or advisable, an order issued pursuant
to Section 297.1, 298, 298.1, 299, 300, 300.1, or 300.2 may require
the person subject to the order to do any of the following:
   (a) Make restitution or provide reimbursement, indemnification, or
guarantee against loss, if the subject institution, subject person,
or holding company was unjustly enriched by the action or violation
or if the action or violation involved a reckless disregard for any
provision of this division, of any regulation or order issued under
this division, of any other applicable law, or of any agreement with
the commissioner.
   (b) Restrict the growth of the subject institution.
   (c) Dispose of any loan or other asset.
   (d) Correct violations of law.
   (e) Employ qualified officers or employees, who may be subject to
approval of the commissioner.
   (f) Limit the activities or functions of the subject institution,
subject person, or holding company.



295.4.  If the commissioner takes possession of a subject
institution without a prior notice or hearing, or takes action
against a subject person without prior notice or hearing, the
commissioner shall, upon taking possession or taking that action,
concurrently provide to the subject institution or subject person a
written order. The order shall set forth the condition or conditions
of the subject institution or action or actions of the subject person
that constitute the basis or bases for the commissioner's action. In
any case where the commissioner takes possession of a subject
institution, the commissioner shall establish, by clear evidence, the
basis for his or her action.



296.  (a) The commissioner may bring an action in the name of the
people of this state in superior court to enjoin any violation of, to
enforce compliance with, or to collect any penalty or other
liability imposed under, any law subject to the jurisdiction of the
commissioner. The commissioner may bring an action in the name of the
people of this state in superior court to enjoin any violation of,
to enforce compliance with, or to collect any penalty or other
liability imposed under, any regulation promulgated under the power
of the commissioner. The commissioner may bring an action in the name
of the people of this state in superior court to enjoin any
violation of, to enforce compliance with, or to collect any penalty
or other liability imposed under, any (1) agreement entered into with
the commissioner or (2) order issued by the commissioner. Upon a
proper showing, a permanent or preliminary injunction, restraining
order, or writ of mandate shall be granted, and a monitor, receiver,
conservator, or other designated fiduciary or officer of the court
may be appointed for the defendant or the defendant's assets, or
other relief may be granted as appropriate.
   (b) A receiver, monitor, conservator, or other designated
fiduciary officer of the court appointed by the court pursuant to
this section may, with the approval of the court, exercise all of the
powers of the defendant's officers, directors, partners, trustees,
or persons who exercise similar powers and perform similar duties. No
action at law or in equity may be maintained by any party against
the commissioner or a receiver, monitor, conservator, or other
designated fiduciary or officer of the court by reason of his or her
exercise of those powers or performing these duties pursuant to the
order of, or with the approval of, the court.
   (c) If the commissioner finds that it is in the public interest,
the commissioner may include in any action authorized by subdivision
(a) a claim for ancillary relief, including a claim for restitution,
disgorgement, or damages on behalf of the person injured by the act
or practice constituting the subject matter of the action, and the
court shall have jurisdiction to award ancillary relief.
   (d) Neither the provision of subdivision (a) that authorizes the
appointment of a monitor, receiver, conservator, or other designated
fiduciary or officer of the court nor any provision of subdivision
(b) or (c) applies to any of the following:
   (1) A licensee that is authorized by the commissioner to transact
appropriate licensee business.
   (2) A foreign (other state) or foreign (other nation) bank or
credit union that maintains an office in this state in accordance
with federal law, the law of this state, and the law of the bank or
credit union's domicile.
   (e) The provisions of this section that authorize the commissioner
to bring actions and seek relief are not intended to, and do not,
affect any right that any other person may have to bring the same or
similar actions or to seek the same or similar relief.




297.  If the commissioner finds that a person has conducted, or that
there is reasonable cause to believe that a person is about to
conduct, business that requires a license issued by the commissioner
and that person has not been issued the required license, the
commissioner may, without any prior notice or hearing, order the
person to cease and desist from conducting any unauthorized business
unless and until the person is issued a license to engage in
appropriate licensee business.



298.  If, after notice and an opportunity to be heard, the
commissioner finds any of the factors set forth in subdivision (a) or
(b) with respect to any subject institution, subject person, or any
holding company, the commissioner may order the subject institution,
subject person, or holding company to cease and desist from the act
or violation:
   (a) That the subject institution, subject person, or holding
company has engaged or participated, is engaging or participating, or
that there is reasonable cause to believe that the subject
institution, subject person, or holding company is about to engage or
participate, in any unsafe or unsound act with respect to the
business of the subject institution.
   (b) That the subject institution, subject person, or holding
company has violated, is violating, or that there is reasonable cause
to believe that the subject institution, subject person, or holding
company is about to violate any:
   (1) Provision of any division subject to the jurisdiction of the
commissioner.
   (2) Provision of any regulation promulgated by, or subject to the
jurisdiction of, the commissioner.
   (3) Provision of any other applicable law.
   (4) Provision of any written agreement between the subject
institution, subject person, or holding company, and the
commissioner.



298.1.  If the commissioner finds that any of the factors set forth
in Section 298 is true with respect to any subject institution,
subject person, or holding company, and that the action, omission, or
violation is likely to have any of the consequences set forth in
subdivisions (a) to (d), inclusive, the commissioner may, without any
prior notice or opportunity to be heard, order the subject
institution or subject person to cease and desist from the following:
   (a) Any act, omission, or violation that may cause the insolvency
of the subject institution.
   (b) Any act, omission, or violation that may cause significant
dissipation of the assets or earnings of the subject institution.
   (c) Any act, omission, or violation that may weaken the condition
of the subject institution.
   (d) Any act, omission, or violation that may otherwise prejudice
the interests of the customers of the subject institution.



299.  If the commissioner finds that a subject institution's books
or records are so incomplete or inaccurate that the commissioner is
unable through the normal supervisory process to determine the
financial condition of the subject institution or the details or
purpose of any transaction or transactions that may materially affect
the financial condition of the subject institution, the commissioner
may, without any prior notice or hearing, order the subject
institution to do either of the following:
   (a) Cease any activity or practice that gave rise, in whole or in
part, to the incomplete or inaccurate state of the books or records.
   (b) Take affirmative action to restore the books or records to a
complete and accurate state.



300.  If, after notice and an opportunity to be heard, the
commissioner finds that any of the factors set forth in subdivision
(a), any of the factors set forth in subdivision (b), and any of the
factors set forth in subdivision (c) are true with respect to a
subject person of a subject institution or holding company, the
commissioner may issue an order suspending or removing the subject
person from the subject person's office, if any, with the subject
institution or holding company, and prohibiting the subject person
from participating in any manner in the conduct of the affairs of the
subject institution or holding company without the approval of the
commissioner:
   (a) (1) That the subject person has, directly or indirectly,
violated, or has caused a subject institution to violate, any
provision of any:
   (A) Division subject to the jurisdiction of the commissioner.
   (B) Regulation promulgated by, or subject to the jurisdiction of,
the commissioner.
   (C) Other applicable law.
   (D) Order issued by the commissioner or under the commissioner's
authority.
   (E) Written agreement between the subject institution, subject
person, or holding company and the commissioner.
   (2) That the subject person has, directly or indirectly, engaged
or participated in any unsafe or unsound act in connection with the
business of the subject institution, holding company, or any other
business institution.
   (3) That the subject person has, directly or indirectly, engaged
or participated in any act that constitutes a breach of the subject
person's fiduciary duty.
   (b) That, by reason of the act, violation, or breach of fiduciary
duty described in subdivision (a):
   (1) The subject institution, holding company, or business
institution has suffered or will probably suffer financial loss or
other harm.
   (2) The rights or interests of the customers or members of the
subject institution have been or could be prejudiced.
   (3) The subject person has received financial gain or other
benefit.
   (c) That the act, violation, or breach of fiduciary duty described
in subdivision (a) either involves dishonesty on the part of the
subject person or demonstrates the subject person's willful or
continuing disregard for the safety or soundness of the subject
institution, holding company, or business institution.




300.1.  If the commissioner finds that any of the factors set forth
in subdivision (a) of Section 300, any of the factors set forth in
subdivision (b) of Section 300, and any of the factors set forth in
subdivision (c) of Section 300 are true with respect to a subject
person of a subject institution, and that it is necessary or
advisable for the protection of the subject institution or holding
company, or the rights or interests of the customers or members of
the subject institution, the commissioner may, without any prior
notice or opportunity to be heard, issue an order suspending the
subject person from the subject person's office, if any, with the
subject institution or holding company, and prohibiting the subject
person from participating in any manner in the conduct of the affairs
of the subject institution or holding company without the prior
approval of the commissioner.



300.2.  (a) If the commissioner finds that any of the factors set
forth in paragraph (1) and the factor set forth in paragraph (2) are
true with respect to a subject person or former subject person of a
subject institution or holding company, the commissioner may, without
any prior notice or opportunity to be heard, issue an order
suspending the subject person or former subject person from his or
her office, if any, with the subject institution or holding company
and prohibiting him or her from further participating in any manner
in the conduct of the affairs of the subject institution or holding
company without the approval of the commissioner:
   (1) That the subject person or former subject person has been
charged in an indictment issued by a grand jury or in an information,
complaint, or similar pleading issued by a United States attorney,
district attorney, or other governmental official or agency
authorized to prosecute crimes, with commission of or participation
in any of the following:
   (A) A crime that involves dishonesty or breach of trust and that
is punishable by imprisonment for a term exceeding one year.
   (B) A criminal violation of any provision of this division.
   (C) A criminal violation of Section 1956, 1957, or 1960 of Title
18 of, or Section 5322 or 5324 of Title 31 of, the United States
Code.
   (D) A criminal violation of a law of any jurisdiction other than
the United States that is substantially similar to any of the
statutes specified in subparagraph (C).
   (2) That continued or resumed service or participation by the
subject person or former subject person may pose a threat to the
rights or interests of the customers or members of the subject
institution or may threaten to impair public confidence in the
subject institution.
   (b) An order issued pursuant to subdivision (a) shall remain in
effect until the indictment or the information, complaint, or similar
pleading is finally disposed of or, if the order is earlier
terminated by the commissioner, until the order is so terminated.
   (c) If the commissioner finds that the factors set forth in
paragraphs (1) and (2) are true with respect to a subject person or
former subject person of a subject institution or holding company,
the commissioner may, without any prior notice or opportunity to be
heard, issue an order suspending or removing the subject person or
former subject person from his or her office, if any, with the
subject institution or holding company and prohibiting him or her
from further participating in any manner in the affairs of the
subject institution or holding company without the approval of the
commissioner:
   (1) That the subject person or former subject person has been
finally convicted of any crime of the type described in paragraph (1)
of subdivision (a). For purposes of this paragraph, an agreement to
enter a pretrial diversion or similar program is deemed to be a
conviction.
   (2) That continued or resumed service or participation by the
subject person or former subject person may pose a threat to the
interests of the customers of the subject institution or may threaten
to impair public confidence in the subject institution.
   (d) The fact that any subject person of a subject institution
charged with a crime of the type described in paragraph (1) of
subdivision (a) is not finally convicted of the crime does not
preclude the commissioner from issuing an order regarding the subject
person pursuant to any other provision of this article.



300.3.  (a) Any subject institution, subject person of a subject
institution, or former subject person of a subject institution to
whom an order is issued under Sections 300 to 300.2, inclusive, may
apply to the commissioner to modify or rescind the order. In deciding
whether to grant or deny the application, the commissioner shall
consider whether it is in the public interest to modify or rescind
the order and whether it is reasonable to believe that the subject
person or former subject person will, if and when he or she becomes a
subject person of a subject institution or holding company, comply
with all applicable provisions of law, or any regulation or order
issued by the commissioner.
   (b) The right of any subject person or former subject person of a
subject institution or holding company to whom an order is issued
under Sections 300 to 300.2, inclusive, to petition for judicial
review of the order shall not be affected by the failure of the
subject institution or holding company to apply to the commissioner
pursuant to subdivision (a) to modify or rescind the order.



300.4.  (a) In this section, "subject depository institution" means
any:
   (1) Licensee or any bank or credit union that maintains an office
in this state.
   (2) Affiliate of any of the institutions specified in paragraph
(1).
   (3) Subsidiary of any of the institutions specified in paragraph
(1).
   (4) Holding company of any of the institutions specified in
paragraph (1).
   (b) It is unlawful for any subject person or former subject person
of a subject institution to whom an order is issued under Sections
300 to 300.2, inclusive, willfully to do, directly or indirectly, any
of the following without the approval of the commissioner, so long
as the order is in effect:
   (1) Act as a subject person of any subject depository institution.
   (2) Vote any shares or other securities having voting rights for
the election of any person as a director of a subject depository
institution.
   (3) Solicit, procure, transfer or attempt to transfer, or vote any
proxy, consent, or authorization with respect to any shares or other
securities of a subject depository institution having voting rights.
   (4) Otherwise to participate in any manner in the affairs of any
subject depository institution.



301.  The commissioner may revoke or suspend any license issued by,
or under the authority of, the commissioner, if, after notice and
opportunity to be heard, the commissioner finds any of the following:
   (a) The licensee has violated, is violating, or that there is
reasonable cause to believe that the licensee is about to violate,
any provision of any of the following:
   (1) Any division subject to the jurisdiction of the commissioner.
   (2) Any regulation promulgated by, or subject to the jurisdiction
of, the commissioner.
   (3) A provision of any other applicable law.
   (4) A provision of any order issued by the commissioner.
   (5) A provision of any written agreement between the licensee and
the commissioner.
   (6) A condition imposed on any written approval granted by the
commissioner.
   (b) Any fact or condition exists which, if it had existed at the
time of the original application for the license, would be grounds
for denying the application for the license.
   (c) The licensee is conducting its business in an unsafe manner.
   (d) The licensee is in such condition that it is unsafe or unsound
for the licensee to transact appropriate licensee business.
   (e) The licensee has inadequate capital or net worth or is
insolvent.
   (f) The licensee failed to pay any of its obligations as they came
due or is reasonably expected to be unable to pay its obligations as
they come due.
   (g) The licensee is the subject of an order for relief in
bankruptcy, or has sought other relief under any bankruptcy,
reorganization, insolvency, or moratorium law, or any person has
applied for any such relief under any such law against the licensee
and the licensee has by any affirmative act approved of, or consented
to, the action or the relief has been granted.
   (h) The licensee has ceased to transact appropriate licensee
business.
   (i) The licensee refuses to submit its books, papers, and affairs
to the inspection of any examiner.
   (j) Any officer of the licensee refuses to be examined upon oath
touching the concerns of the licensee.
   (k) The licensee has, with the approval of its board, requested
the commissioner to take possession of its property and business.



301.1.  If the commissioner finds that any of the factors set forth
in Section 301 is true with respect to any licensee and that it is
necessary for the protection of the public interest, the commissioner
may issue an order immediately suspending or revoking the licensee's
license.


302.  If the commissioner finds that any of the factors set forth in
subdivisions (a) to (k), inclusive, is true with respect to a
licensee, the commissioner may by order, without any prior notice or
opportunity to be heard, take possession of the property and business
of the licensee:
   (a) The licensee has violated any provision of (1) any division
subject to the jurisdiction of the commissioner, (2) any regulation
promulgated by, or subject to the jurisdiction of, the commissioner,
(3) any provision of any other applicable law, (4) any provision of
any order issued by the commissioner, (5) any provision of any
written agreement made between the commissioner and the licensee, or
(6) a condition imposed on any written approval granted by the
commissioner.
   (b) The licensee is conducting its business in an unsafe or
unsound manner.
   (c) The licensee is in such condition that it is unsafe or unsound
for the licensee to transact appropriate licensee business.
   (d) The licensee has inadequate capital or net worth or is
insolvent.
   (e) If the licensee is a bank, the tangible shareholders' equity
of the bank is less than the following:
   (1) If the bank is a commercial bank or industrial bank, the
greater of three percent of the bank's total assets or one million
dollars ($1,000,000).
   (2) If the bank is a trust company other than a commercial bank
authorized to engage in trust business, one million dollars
($1,000,000).
   (f) The licensee failed to pay any of its obligations as they came
due or is reasonably expected to be unable to pay its obligations as
they come due.
   (g) The licensee has applied for an adjudication of bankruptcy,
reorganization, arrangement, or other relief under any bankruptcy,
reorganization, insolvency, or moratorium law, or that any person has
applied for any such relief under any such law against the licensee
and the licensee has by any affirmative act approved of or consented
to the action or the relief has been granted.
   (h) The licensee has ceased to transact the business the licensee
is authorized to conduct pursuant to its license.
   (i) The licensee refuses to submit its books, papers, and affairs
to the inspection of any examiner.
   (j) Any officer of the licensee refuses to be examined upon oath
touching the concerns of the licensee.
   (k) The licensee has, with the approval of its board, requested
the commissioner to take possession of its property and business.



302.1.  (a) If the commissioner takes possession of the property and
business of a licensee pursuant to Section 302, the licensee may,
within 10 days, apply to the superior court in the county where its
head office is located to enjoin further proceedings. The court may,
after citing the commissioner to show cause why further proceedings
should not be enjoined and after a hearing, dismiss the application
or enjoin the commissioner from further proceedings and order the
commissioner to surrender the property and business of the licensee
to the licensee or make any further order as may be just. The
judgment of the court may be appealed by the commissioner or by the
licensee as allowed by law.
   (b) At any time after the commissioner takes possession of the
property and business of a licensee pursuant to Section 302, the
licensee may, with the approval of the commissioner, resume business
upon conditions as the commissioner may prescribe.



302.2.  (a) Upon taking possession of the property and business of
any licensee, the commissioner shall give notice of that fact to all
persons holding or having in their possession any assets of the
licensee. No person knowing of the taking, or who has been notified
thereof, shall have a lien or charge upon any assets of the licensee
for any payment, advance, or clearance thereafter made or for any
liability thereafter incurred.
   (b) The giving of notice in accordance with this section shall not
be deemed to be a prerequisite to the taking of possession of the
property and business of the licensee.



302.3.  The commissioner is deemed to take possession of the entire
property and business of a licensee when the commissioner takes
possession of the business and property of the head office of the
licensee.

State Codes and Statutes

Statutes > California > Fin > 295-302.3

FINANCIAL CODE
SECTION 295-302.3



295.  In this article:
   (a) "Appropriate licensee business" means the business that a
licensee may conduct in accordance with the charter or license that
the commissioner has issued to that licensee.
   (b) "Customer" means a depositor of a bank, a member of a credit
union, or a customer of any other licensee.
   (c) "Holding company" shall have the meaning set forth in Section
3700.
   (d) "Officer of a subject institution" means any director,
officer, official, or employee of the subject institution.
   (e) "Person" means a subject institution or a subject person.
   (f) "Subject institution" means any of the following:
   (1) Licensee.
   (2) Subsidiary of a licensee.
   (3) Foreign (other state) or foreign (other nation) bank or credit
union that maintains an office in this state, with respect to any
such office other than a national bank or federal credit union.
   (4) Any other person lawfully conducting the business of a bank or
credit union in this state other than a national bank or federal
credit union.
   (g)  "Subject person," when used with respect to a subject
institution, means any of the following:
   (1) Director, officer, employee, or agent of the subject
institution.
   (2) Member, consultant, joint venture partner, or other person
that participates in the affairs of a subject institution.
   (3) Independent contractor, including any attorney, appraiser, or
accountant, who knowingly or recklessly participates in any of the
following acts if the act caused or is likely to cause more than a
minimal financial loss to, or a significant adverse effect on, the
subject institution:
   (A) A violation of any applicable law, regulation, or order.
   (B) A breach of fiduciary duty.
   (C) An unsafe or unsound act.
   (h)  "Violation" includes any act performed, alone or with other
persons, for or toward causing, bringing about, participating in,
counseling, aiding, or abetting a violation of any applicable
statute, regulation, provision of a written order issued by the
commissioner, or provision of a written agreement made between the
commissioner and a subject institution or subject person.



295.1.  Any subject person who is entitled to a hearing pursuant to
this article may waive that right at any time. A waiver under this
section shall relieve the commissioner from having to issue a formal
notice of hearing that would otherwise be required by this article.



295.2.  (a) Within 30 days after an order is issued pursuant to
Section 297, 298.1, 299, 300.1, or 301.1, or subdivision (c) of
Section 300.2, the person to whom the order is issued may file with
the commissioner an application for a hearing on the order.
   (b) If the commissioner fails to commence the hearing within 15
business days after the application is filed with the commissioner or
within any longer period to which the person subject to the order
consents, the order shall be deemed rescinded.
   (c) Within 30 days after the hearing, or within any longer period
to which the person consents, the commissioner shall affirm, modify,
or rescind the order. If the commissioner fails to affirm, modify, or
rescind the order within that time limit, the order shall be deemed
rescinded.
   (d) The right to petition for judicial review of the order shall
not be affected by the failure of the person subject to the order to
apply to the commissioner for a hearing on the order pursuant to
subdivision (a).


295.3.  In addition to any other action or requirement the
commissioner deems necessary or advisable, an order issued pursuant
to Section 297.1, 298, 298.1, 299, 300, 300.1, or 300.2 may require
the person subject to the order to do any of the following:
   (a) Make restitution or provide reimbursement, indemnification, or
guarantee against loss, if the subject institution, subject person,
or holding company was unjustly enriched by the action or violation
or if the action or violation involved a reckless disregard for any
provision of this division, of any regulation or order issued under
this division, of any other applicable law, or of any agreement with
the commissioner.
   (b) Restrict the growth of the subject institution.
   (c) Dispose of any loan or other asset.
   (d) Correct violations of law.
   (e) Employ qualified officers or employees, who may be subject to
approval of the commissioner.
   (f) Limit the activities or functions of the subject institution,
subject person, or holding company.



295.4.  If the commissioner takes possession of a subject
institution without a prior notice or hearing, or takes action
against a subject person without prior notice or hearing, the
commissioner shall, upon taking possession or taking that action,
concurrently provide to the subject institution or subject person a
written order. The order shall set forth the condition or conditions
of the subject institution or action or actions of the subject person
that constitute the basis or bases for the commissioner's action. In
any case where the commissioner takes possession of a subject
institution, the commissioner shall establish, by clear evidence, the
basis for his or her action.



296.  (a) The commissioner may bring an action in the name of the
people of this state in superior court to enjoin any violation of, to
enforce compliance with, or to collect any penalty or other
liability imposed under, any law subject to the jurisdiction of the
commissioner. The commissioner may bring an action in the name of the
people of this state in superior court to enjoin any violation of,
to enforce compliance with, or to collect any penalty or other
liability imposed under, any regulation promulgated under the power
of the commissioner. The commissioner may bring an action in the name
of the people of this state in superior court to enjoin any
violation of, to enforce compliance with, or to collect any penalty
or other liability imposed under, any (1) agreement entered into with
the commissioner or (2) order issued by the commissioner. Upon a
proper showing, a permanent or preliminary injunction, restraining
order, or writ of mandate shall be granted, and a monitor, receiver,
conservator, or other designated fiduciary or officer of the court
may be appointed for the defendant or the defendant's assets, or
other relief may be granted as appropriate.
   (b) A receiver, monitor, conservator, or other designated
fiduciary officer of the court appointed by the court pursuant to
this section may, with the approval of the court, exercise all of the
powers of the defendant's officers, directors, partners, trustees,
or persons who exercise similar powers and perform similar duties. No
action at law or in equity may be maintained by any party against
the commissioner or a receiver, monitor, conservator, or other
designated fiduciary or officer of the court by reason of his or her
exercise of those powers or performing these duties pursuant to the
order of, or with the approval of, the court.
   (c) If the commissioner finds that it is in the public interest,
the commissioner may include in any action authorized by subdivision
(a) a claim for ancillary relief, including a claim for restitution,
disgorgement, or damages on behalf of the person injured by the act
or practice constituting the subject matter of the action, and the
court shall have jurisdiction to award ancillary relief.
   (d) Neither the provision of subdivision (a) that authorizes the
appointment of a monitor, receiver, conservator, or other designated
fiduciary or officer of the court nor any provision of subdivision
(b) or (c) applies to any of the following:
   (1) A licensee that is authorized by the commissioner to transact
appropriate licensee business.
   (2) A foreign (other state) or foreign (other nation) bank or
credit union that maintains an office in this state in accordance
with federal law, the law of this state, and the law of the bank or
credit union's domicile.
   (e) The provisions of this section that authorize the commissioner
to bring actions and seek relief are not intended to, and do not,
affect any right that any other person may have to bring the same or
similar actions or to seek the same or similar relief.




297.  If the commissioner finds that a person has conducted, or that
there is reasonable cause to believe that a person is about to
conduct, business that requires a license issued by the commissioner
and that person has not been issued the required license, the
commissioner may, without any prior notice or hearing, order the
person to cease and desist from conducting any unauthorized business
unless and until the person is issued a license to engage in
appropriate licensee business.



298.  If, after notice and an opportunity to be heard, the
commissioner finds any of the factors set forth in subdivision (a) or
(b) with respect to any subject institution, subject person, or any
holding company, the commissioner may order the subject institution,
subject person, or holding company to cease and desist from the act
or violation:
   (a) That the subject institution, subject person, or holding
company has engaged or participated, is engaging or participating, or
that there is reasonable cause to believe that the subject
institution, subject person, or holding company is about to engage or
participate, in any unsafe or unsound act with respect to the
business of the subject institution.
   (b) That the subject institution, subject person, or holding
company has violated, is violating, or that there is reasonable cause
to believe that the subject institution, subject person, or holding
company is about to violate any:
   (1) Provision of any division subject to the jurisdiction of the
commissioner.
   (2) Provision of any regulation promulgated by, or subject to the
jurisdiction of, the commissioner.
   (3) Provision of any other applicable law.
   (4) Provision of any written agreement between the subject
institution, subject person, or holding company, and the
commissioner.



298.1.  If the commissioner finds that any of the factors set forth
in Section 298 is true with respect to any subject institution,
subject person, or holding company, and that the action, omission, or
violation is likely to have any of the consequences set forth in
subdivisions (a) to (d), inclusive, the commissioner may, without any
prior notice or opportunity to be heard, order the subject
institution or subject person to cease and desist from the following:
   (a) Any act, omission, or violation that may cause the insolvency
of the subject institution.
   (b) Any act, omission, or violation that may cause significant
dissipation of the assets or earnings of the subject institution.
   (c) Any act, omission, or violation that may weaken the condition
of the subject institution.
   (d) Any act, omission, or violation that may otherwise prejudice
the interests of the customers of the subject institution.



299.  If the commissioner finds that a subject institution's books
or records are so incomplete or inaccurate that the commissioner is
unable through the normal supervisory process to determine the
financial condition of the subject institution or the details or
purpose of any transaction or transactions that may materially affect
the financial condition of the subject institution, the commissioner
may, without any prior notice or hearing, order the subject
institution to do either of the following:
   (a) Cease any activity or practice that gave rise, in whole or in
part, to the incomplete or inaccurate state of the books or records.
   (b) Take affirmative action to restore the books or records to a
complete and accurate state.



300.  If, after notice and an opportunity to be heard, the
commissioner finds that any of the factors set forth in subdivision
(a), any of the factors set forth in subdivision (b), and any of the
factors set forth in subdivision (c) are true with respect to a
subject person of a subject institution or holding company, the
commissioner may issue an order suspending or removing the subject
person from the subject person's office, if any, with the subject
institution or holding company, and prohibiting the subject person
from participating in any manner in the conduct of the affairs of the
subject institution or holding company without the approval of the
commissioner:
   (a) (1) That the subject person has, directly or indirectly,
violated, or has caused a subject institution to violate, any
provision of any:
   (A) Division subject to the jurisdiction of the commissioner.
   (B) Regulation promulgated by, or subject to the jurisdiction of,
the commissioner.
   (C) Other applicable law.
   (D) Order issued by the commissioner or under the commissioner's
authority.
   (E) Written agreement between the subject institution, subject
person, or holding company and the commissioner.
   (2) That the subject person has, directly or indirectly, engaged
or participated in any unsafe or unsound act in connection with the
business of the subject institution, holding company, or any other
business institution.
   (3) That the subject person has, directly or indirectly, engaged
or participated in any act that constitutes a breach of the subject
person's fiduciary duty.
   (b) That, by reason of the act, violation, or breach of fiduciary
duty described in subdivision (a):
   (1) The subject institution, holding company, or business
institution has suffered or will probably suffer financial loss or
other harm.
   (2) The rights or interests of the customers or members of the
subject institution have been or could be prejudiced.
   (3) The subject person has received financial gain or other
benefit.
   (c) That the act, violation, or breach of fiduciary duty described
in subdivision (a) either involves dishonesty on the part of the
subject person or demonstrates the subject person's willful or
continuing disregard for the safety or soundness of the subject
institution, holding company, or business institution.




300.1.  If the commissioner finds that any of the factors set forth
in subdivision (a) of Section 300, any of the factors set forth in
subdivision (b) of Section 300, and any of the factors set forth in
subdivision (c) of Section 300 are true with respect to a subject
person of a subject institution, and that it is necessary or
advisable for the protection of the subject institution or holding
company, or the rights or interests of the customers or members of
the subject institution, the commissioner may, without any prior
notice or opportunity to be heard, issue an order suspending the
subject person from the subject person's office, if any, with the
subject institution or holding company, and prohibiting the subject
person from participating in any manner in the conduct of the affairs
of the subject institution or holding company without the prior
approval of the commissioner.



300.2.  (a) If the commissioner finds that any of the factors set
forth in paragraph (1) and the factor set forth in paragraph (2) are
true with respect to a subject person or former subject person of a
subject institution or holding company, the commissioner may, without
any prior notice or opportunity to be heard, issue an order
suspending the subject person or former subject person from his or
her office, if any, with the subject institution or holding company
and prohibiting him or her from further participating in any manner
in the conduct of the affairs of the subject institution or holding
company without the approval of the commissioner:
   (1) That the subject person or former subject person has been
charged in an indictment issued by a grand jury or in an information,
complaint, or similar pleading issued by a United States attorney,
district attorney, or other governmental official or agency
authorized to prosecute crimes, with commission of or participation
in any of the following:
   (A) A crime that involves dishonesty or breach of trust and that
is punishable by imprisonment for a term exceeding one year.
   (B) A criminal violation of any provision of this division.
   (C) A criminal violation of Section 1956, 1957, or 1960 of Title
18 of, or Section 5322 or 5324 of Title 31 of, the United States
Code.
   (D) A criminal violation of a law of any jurisdiction other than
the United States that is substantially similar to any of the
statutes specified in subparagraph (C).
   (2) That continued or resumed service or participation by the
subject person or former subject person may pose a threat to the
rights or interests of the customers or members of the subject
institution or may threaten to impair public confidence in the
subject institution.
   (b) An order issued pursuant to subdivision (a) shall remain in
effect until the indictment or the information, complaint, or similar
pleading is finally disposed of or, if the order is earlier
terminated by the commissioner, until the order is so terminated.
   (c) If the commissioner finds that the factors set forth in
paragraphs (1) and (2) are true with respect to a subject person or
former subject person of a subject institution or holding company,
the commissioner may, without any prior notice or opportunity to be
heard, issue an order suspending or removing the subject person or
former subject person from his or her office, if any, with the
subject institution or holding company and prohibiting him or her
from further participating in any manner in the affairs of the
subject institution or holding company without the approval of the
commissioner:
   (1) That the subject person or former subject person has been
finally convicted of any crime of the type described in paragraph (1)
of subdivision (a). For purposes of this paragraph, an agreement to
enter a pretrial diversion or similar program is deemed to be a
conviction.
   (2) That continued or resumed service or participation by the
subject person or former subject person may pose a threat to the
interests of the customers of the subject institution or may threaten
to impair public confidence in the subject institution.
   (d) The fact that any subject person of a subject institution
charged with a crime of the type described in paragraph (1) of
subdivision (a) is not finally convicted of the crime does not
preclude the commissioner from issuing an order regarding the subject
person pursuant to any other provision of this article.



300.3.  (a) Any subject institution, subject person of a subject
institution, or former subject person of a subject institution to
whom an order is issued under Sections 300 to 300.2, inclusive, may
apply to the commissioner to modify or rescind the order. In deciding
whether to grant or deny the application, the commissioner shall
consider whether it is in the public interest to modify or rescind
the order and whether it is reasonable to believe that the subject
person or former subject person will, if and when he or she becomes a
subject person of a subject institution or holding company, comply
with all applicable provisions of law, or any regulation or order
issued by the commissioner.
   (b) The right of any subject person or former subject person of a
subject institution or holding company to whom an order is issued
under Sections 300 to 300.2, inclusive, to petition for judicial
review of the order shall not be affected by the failure of the
subject institution or holding company to apply to the commissioner
pursuant to subdivision (a) to modify or rescind the order.



300.4.  (a) In this section, "subject depository institution" means
any:
   (1) Licensee or any bank or credit union that maintains an office
in this state.
   (2) Affiliate of any of the institutions specified in paragraph
(1).
   (3) Subsidiary of any of the institutions specified in paragraph
(1).
   (4) Holding company of any of the institutions specified in
paragraph (1).
   (b) It is unlawful for any subject person or former subject person
of a subject institution to whom an order is issued under Sections
300 to 300.2, inclusive, willfully to do, directly or indirectly, any
of the following without the approval of the commissioner, so long
as the order is in effect:
   (1) Act as a subject person of any subject depository institution.
   (2) Vote any shares or other securities having voting rights for
the election of any person as a director of a subject depository
institution.
   (3) Solicit, procure, transfer or attempt to transfer, or vote any
proxy, consent, or authorization with respect to any shares or other
securities of a subject depository institution having voting rights.
   (4) Otherwise to participate in any manner in the affairs of any
subject depository institution.



301.  The commissioner may revoke or suspend any license issued by,
or under the authority of, the commissioner, if, after notice and
opportunity to be heard, the commissioner finds any of the following:
   (a) The licensee has violated, is violating, or that there is
reasonable cause to believe that the licensee is about to violate,
any provision of any of the following:
   (1) Any division subject to the jurisdiction of the commissioner.
   (2) Any regulation promulgated by, or subject to the jurisdiction
of, the commissioner.
   (3) A provision of any other applicable law.
   (4) A provision of any order issued by the commissioner.
   (5) A provision of any written agreement between the licensee and
the commissioner.
   (6) A condition imposed on any written approval granted by the
commissioner.
   (b) Any fact or condition exists which, if it had existed at the
time of the original application for the license, would be grounds
for denying the application for the license.
   (c) The licensee is conducting its business in an unsafe manner.
   (d) The licensee is in such condition that it is unsafe or unsound
for the licensee to transact appropriate licensee business.
   (e) The licensee has inadequate capital or net worth or is
insolvent.
   (f) The licensee failed to pay any of its obligations as they came
due or is reasonably expected to be unable to pay its obligations as
they come due.
   (g) The licensee is the subject of an order for relief in
bankruptcy, or has sought other relief under any bankruptcy,
reorganization, insolvency, or moratorium law, or any person has
applied for any such relief under any such law against the licensee
and the licensee has by any affirmative act approved of, or consented
to, the action or the relief has been granted.
   (h) The licensee has ceased to transact appropriate licensee
business.
   (i) The licensee refuses to submit its books, papers, and affairs
to the inspection of any examiner.
   (j) Any officer of the licensee refuses to be examined upon oath
touching the concerns of the licensee.
   (k) The licensee has, with the approval of its board, requested
the commissioner to take possession of its property and business.



301.1.  If the commissioner finds that any of the factors set forth
in Section 301 is true with respect to any licensee and that it is
necessary for the protection of the public interest, the commissioner
may issue an order immediately suspending or revoking the licensee's
license.


302.  If the commissioner finds that any of the factors set forth in
subdivisions (a) to (k), inclusive, is true with respect to a
licensee, the commissioner may by order, without any prior notice or
opportunity to be heard, take possession of the property and business
of the licensee:
   (a) The licensee has violated any provision of (1) any division
subject to the jurisdiction of the commissioner, (2) any regulation
promulgated by, or subject to the jurisdiction of, the commissioner,
(3) any provision of any other applicable law, (4) any provision of
any order issued by the commissioner, (5) any provision of any
written agreement made between the commissioner and the licensee, or
(6) a condition imposed on any written approval granted by the
commissioner.
   (b) The licensee is conducting its business in an unsafe or
unsound manner.
   (c) The licensee is in such condition that it is unsafe or unsound
for the licensee to transact appropriate licensee business.
   (d) The licensee has inadequate capital or net worth or is
insolvent.
   (e) If the licensee is a bank, the tangible shareholders' equity
of the bank is less than the following:
   (1) If the bank is a commercial bank or industrial bank, the
greater of three percent of the bank's total assets or one million
dollars ($1,000,000).
   (2) If the bank is a trust company other than a commercial bank
authorized to engage in trust business, one million dollars
($1,000,000).
   (f) The licensee failed to pay any of its obligations as they came
due or is reasonably expected to be unable to pay its obligations as
they come due.
   (g) The licensee has applied for an adjudication of bankruptcy,
reorganization, arrangement, or other relief under any bankruptcy,
reorganization, insolvency, or moratorium law, or that any person has
applied for any such relief under any such law against the licensee
and the licensee has by any affirmative act approved of or consented
to the action or the relief has been granted.
   (h) The licensee has ceased to transact the business the licensee
is authorized to conduct pursuant to its license.
   (i) The licensee refuses to submit its books, papers, and affairs
to the inspection of any examiner.
   (j) Any officer of the licensee refuses to be examined upon oath
touching the concerns of the licensee.
   (k) The licensee has, with the approval of its board, requested
the commissioner to take possession of its property and business.



302.1.  (a) If the commissioner takes possession of the property and
business of a licensee pursuant to Section 302, the licensee may,
within 10 days, apply to the superior court in the county where its
head office is located to enjoin further proceedings. The court may,
after citing the commissioner to show cause why further proceedings
should not be enjoined and after a hearing, dismiss the application
or enjoin the commissioner from further proceedings and order the
commissioner to surrender the property and business of the licensee
to the licensee or make any further order as may be just. The
judgment of the court may be appealed by the commissioner or by the
licensee as allowed by law.
   (b) At any time after the commissioner takes possession of the
property and business of a licensee pursuant to Section 302, the
licensee may, with the approval of the commissioner, resume business
upon conditions as the commissioner may prescribe.



302.2.  (a) Upon taking possession of the property and business of
any licensee, the commissioner shall give notice of that fact to all
persons holding or having in their possession any assets of the
licensee. No person knowing of the taking, or who has been notified
thereof, shall have a lien or charge upon any assets of the licensee
for any payment, advance, or clearance thereafter made or for any
liability thereafter incurred.
   (b) The giving of notice in accordance with this section shall not
be deemed to be a prerequisite to the taking of possession of the
property and business of the licensee.



302.3.  The commissioner is deemed to take possession of the entire
property and business of a licensee when the commissioner takes
possession of the business and property of the head office of the
licensee.


State Codes and Statutes

State Codes and Statutes

Statutes > California > Fin > 295-302.3

FINANCIAL CODE
SECTION 295-302.3



295.  In this article:
   (a) "Appropriate licensee business" means the business that a
licensee may conduct in accordance with the charter or license that
the commissioner has issued to that licensee.
   (b) "Customer" means a depositor of a bank, a member of a credit
union, or a customer of any other licensee.
   (c) "Holding company" shall have the meaning set forth in Section
3700.
   (d) "Officer of a subject institution" means any director,
officer, official, or employee of the subject institution.
   (e) "Person" means a subject institution or a subject person.
   (f) "Subject institution" means any of the following:
   (1) Licensee.
   (2) Subsidiary of a licensee.
   (3) Foreign (other state) or foreign (other nation) bank or credit
union that maintains an office in this state, with respect to any
such office other than a national bank or federal credit union.
   (4) Any other person lawfully conducting the business of a bank or
credit union in this state other than a national bank or federal
credit union.
   (g)  "Subject person," when used with respect to a subject
institution, means any of the following:
   (1) Director, officer, employee, or agent of the subject
institution.
   (2) Member, consultant, joint venture partner, or other person
that participates in the affairs of a subject institution.
   (3) Independent contractor, including any attorney, appraiser, or
accountant, who knowingly or recklessly participates in any of the
following acts if the act caused or is likely to cause more than a
minimal financial loss to, or a significant adverse effect on, the
subject institution:
   (A) A violation of any applicable law, regulation, or order.
   (B) A breach of fiduciary duty.
   (C) An unsafe or unsound act.
   (h)  "Violation" includes any act performed, alone or with other
persons, for or toward causing, bringing about, participating in,
counseling, aiding, or abetting a violation of any applicable
statute, regulation, provision of a written order issued by the
commissioner, or provision of a written agreement made between the
commissioner and a subject institution or subject person.



295.1.  Any subject person who is entitled to a hearing pursuant to
this article may waive that right at any time. A waiver under this
section shall relieve the commissioner from having to issue a formal
notice of hearing that would otherwise be required by this article.



295.2.  (a) Within 30 days after an order is issued pursuant to
Section 297, 298.1, 299, 300.1, or 301.1, or subdivision (c) of
Section 300.2, the person to whom the order is issued may file with
the commissioner an application for a hearing on the order.
   (b) If the commissioner fails to commence the hearing within 15
business days after the application is filed with the commissioner or
within any longer period to which the person subject to the order
consents, the order shall be deemed rescinded.
   (c) Within 30 days after the hearing, or within any longer period
to which the person consents, the commissioner shall affirm, modify,
or rescind the order. If the commissioner fails to affirm, modify, or
rescind the order within that time limit, the order shall be deemed
rescinded.
   (d) The right to petition for judicial review of the order shall
not be affected by the failure of the person subject to the order to
apply to the commissioner for a hearing on the order pursuant to
subdivision (a).


295.3.  In addition to any other action or requirement the
commissioner deems necessary or advisable, an order issued pursuant
to Section 297.1, 298, 298.1, 299, 300, 300.1, or 300.2 may require
the person subject to the order to do any of the following:
   (a) Make restitution or provide reimbursement, indemnification, or
guarantee against loss, if the subject institution, subject person,
or holding company was unjustly enriched by the action or violation
or if the action or violation involved a reckless disregard for any
provision of this division, of any regulation or order issued under
this division, of any other applicable law, or of any agreement with
the commissioner.
   (b) Restrict the growth of the subject institution.
   (c) Dispose of any loan or other asset.
   (d) Correct violations of law.
   (e) Employ qualified officers or employees, who may be subject to
approval of the commissioner.
   (f) Limit the activities or functions of the subject institution,
subject person, or holding company.



295.4.  If the commissioner takes possession of a subject
institution without a prior notice or hearing, or takes action
against a subject person without prior notice or hearing, the
commissioner shall, upon taking possession or taking that action,
concurrently provide to the subject institution or subject person a
written order. The order shall set forth the condition or conditions
of the subject institution or action or actions of the subject person
that constitute the basis or bases for the commissioner's action. In
any case where the commissioner takes possession of a subject
institution, the commissioner shall establish, by clear evidence, the
basis for his or her action.



296.  (a) The commissioner may bring an action in the name of the
people of this state in superior court to enjoin any violation of, to
enforce compliance with, or to collect any penalty or other
liability imposed under, any law subject to the jurisdiction of the
commissioner. The commissioner may bring an action in the name of the
people of this state in superior court to enjoin any violation of,
to enforce compliance with, or to collect any penalty or other
liability imposed under, any regulation promulgated under the power
of the commissioner. The commissioner may bring an action in the name
of the people of this state in superior court to enjoin any
violation of, to enforce compliance with, or to collect any penalty
or other liability imposed under, any (1) agreement entered into with
the commissioner or (2) order issued by the commissioner. Upon a
proper showing, a permanent or preliminary injunction, restraining
order, or writ of mandate shall be granted, and a monitor, receiver,
conservator, or other designated fiduciary or officer of the court
may be appointed for the defendant or the defendant's assets, or
other relief may be granted as appropriate.
   (b) A receiver, monitor, conservator, or other designated
fiduciary officer of the court appointed by the court pursuant to
this section may, with the approval of the court, exercise all of the
powers of the defendant's officers, directors, partners, trustees,
or persons who exercise similar powers and perform similar duties. No
action at law or in equity may be maintained by any party against
the commissioner or a receiver, monitor, conservator, or other
designated fiduciary or officer of the court by reason of his or her
exercise of those powers or performing these duties pursuant to the
order of, or with the approval of, the court.
   (c) If the commissioner finds that it is in the public interest,
the commissioner may include in any action authorized by subdivision
(a) a claim for ancillary relief, including a claim for restitution,
disgorgement, or damages on behalf of the person injured by the act
or practice constituting the subject matter of the action, and the
court shall have jurisdiction to award ancillary relief.
   (d) Neither the provision of subdivision (a) that authorizes the
appointment of a monitor, receiver, conservator, or other designated
fiduciary or officer of the court nor any provision of subdivision
(b) or (c) applies to any of the following:
   (1) A licensee that is authorized by the commissioner to transact
appropriate licensee business.
   (2) A foreign (other state) or foreign (other nation) bank or
credit union that maintains an office in this state in accordance
with federal law, the law of this state, and the law of the bank or
credit union's domicile.
   (e) The provisions of this section that authorize the commissioner
to bring actions and seek relief are not intended to, and do not,
affect any right that any other person may have to bring the same or
similar actions or to seek the same or similar relief.




297.  If the commissioner finds that a person has conducted, or that
there is reasonable cause to believe that a person is about to
conduct, business that requires a license issued by the commissioner
and that person has not been issued the required license, the
commissioner may, without any prior notice or hearing, order the
person to cease and desist from conducting any unauthorized business
unless and until the person is issued a license to engage in
appropriate licensee business.



298.  If, after notice and an opportunity to be heard, the
commissioner finds any of the factors set forth in subdivision (a) or
(b) with respect to any subject institution, subject person, or any
holding company, the commissioner may order the subject institution,
subject person, or holding company to cease and desist from the act
or violation:
   (a) That the subject institution, subject person, or holding
company has engaged or participated, is engaging or participating, or
that there is reasonable cause to believe that the subject
institution, subject person, or holding company is about to engage or
participate, in any unsafe or unsound act with respect to the
business of the subject institution.
   (b) That the subject institution, subject person, or holding
company has violated, is violating, or that there is reasonable cause
to believe that the subject institution, subject person, or holding
company is about to violate any:
   (1) Provision of any division subject to the jurisdiction of the
commissioner.
   (2) Provision of any regulation promulgated by, or subject to the
jurisdiction of, the commissioner.
   (3) Provision of any other applicable law.
   (4) Provision of any written agreement between the subject
institution, subject person, or holding company, and the
commissioner.



298.1.  If the commissioner finds that any of the factors set forth
in Section 298 is true with respect to any subject institution,
subject person, or holding company, and that the action, omission, or
violation is likely to have any of the consequences set forth in
subdivisions (a) to (d), inclusive, the commissioner may, without any
prior notice or opportunity to be heard, order the subject
institution or subject person to cease and desist from the following:
   (a) Any act, omission, or violation that may cause the insolvency
of the subject institution.
   (b) Any act, omission, or violation that may cause significant
dissipation of the assets or earnings of the subject institution.
   (c) Any act, omission, or violation that may weaken the condition
of the subject institution.
   (d) Any act, omission, or violation that may otherwise prejudice
the interests of the customers of the subject institution.



299.  If the commissioner finds that a subject institution's books
or records are so incomplete or inaccurate that the commissioner is
unable through the normal supervisory process to determine the
financial condition of the subject institution or the details or
purpose of any transaction or transactions that may materially affect
the financial condition of the subject institution, the commissioner
may, without any prior notice or hearing, order the subject
institution to do either of the following:
   (a) Cease any activity or practice that gave rise, in whole or in
part, to the incomplete or inaccurate state of the books or records.
   (b) Take affirmative action to restore the books or records to a
complete and accurate state.



300.  If, after notice and an opportunity to be heard, the
commissioner finds that any of the factors set forth in subdivision
(a), any of the factors set forth in subdivision (b), and any of the
factors set forth in subdivision (c) are true with respect to a
subject person of a subject institution or holding company, the
commissioner may issue an order suspending or removing the subject
person from the subject person's office, if any, with the subject
institution or holding company, and prohibiting the subject person
from participating in any manner in the conduct of the affairs of the
subject institution or holding company without the approval of the
commissioner:
   (a) (1) That the subject person has, directly or indirectly,
violated, or has caused a subject institution to violate, any
provision of any:
   (A) Division subject to the jurisdiction of the commissioner.
   (B) Regulation promulgated by, or subject to the jurisdiction of,
the commissioner.
   (C) Other applicable law.
   (D) Order issued by the commissioner or under the commissioner's
authority.
   (E) Written agreement between the subject institution, subject
person, or holding company and the commissioner.
   (2) That the subject person has, directly or indirectly, engaged
or participated in any unsafe or unsound act in connection with the
business of the subject institution, holding company, or any other
business institution.
   (3) That the subject person has, directly or indirectly, engaged
or participated in any act that constitutes a breach of the subject
person's fiduciary duty.
   (b) That, by reason of the act, violation, or breach of fiduciary
duty described in subdivision (a):
   (1) The subject institution, holding company, or business
institution has suffered or will probably suffer financial loss or
other harm.
   (2) The rights or interests of the customers or members of the
subject institution have been or could be prejudiced.
   (3) The subject person has received financial gain or other
benefit.
   (c) That the act, violation, or breach of fiduciary duty described
in subdivision (a) either involves dishonesty on the part of the
subject person or demonstrates the subject person's willful or
continuing disregard for the safety or soundness of the subject
institution, holding company, or business institution.




300.1.  If the commissioner finds that any of the factors set forth
in subdivision (a) of Section 300, any of the factors set forth in
subdivision (b) of Section 300, and any of the factors set forth in
subdivision (c) of Section 300 are true with respect to a subject
person of a subject institution, and that it is necessary or
advisable for the protection of the subject institution or holding
company, or the rights or interests of the customers or members of
the subject institution, the commissioner may, without any prior
notice or opportunity to be heard, issue an order suspending the
subject person from the subject person's office, if any, with the
subject institution or holding company, and prohibiting the subject
person from participating in any manner in the conduct of the affairs
of the subject institution or holding company without the prior
approval of the commissioner.



300.2.  (a) If the commissioner finds that any of the factors set
forth in paragraph (1) and the factor set forth in paragraph (2) are
true with respect to a subject person or former subject person of a
subject institution or holding company, the commissioner may, without
any prior notice or opportunity to be heard, issue an order
suspending the subject person or former subject person from his or
her office, if any, with the subject institution or holding company
and prohibiting him or her from further participating in any manner
in the conduct of the affairs of the subject institution or holding
company without the approval of the commissioner:
   (1) That the subject person or former subject person has been
charged in an indictment issued by a grand jury or in an information,
complaint, or similar pleading issued by a United States attorney,
district attorney, or other governmental official or agency
authorized to prosecute crimes, with commission of or participation
in any of the following:
   (A) A crime that involves dishonesty or breach of trust and that
is punishable by imprisonment for a term exceeding one year.
   (B) A criminal violation of any provision of this division.
   (C) A criminal violation of Section 1956, 1957, or 1960 of Title
18 of, or Section 5322 or 5324 of Title 31 of, the United States
Code.
   (D) A criminal violation of a law of any jurisdiction other than
the United States that is substantially similar to any of the
statutes specified in subparagraph (C).
   (2) That continued or resumed service or participation by the
subject person or former subject person may pose a threat to the
rights or interests of the customers or members of the subject
institution or may threaten to impair public confidence in the
subject institution.
   (b) An order issued pursuant to subdivision (a) shall remain in
effect until the indictment or the information, complaint, or similar
pleading is finally disposed of or, if the order is earlier
terminated by the commissioner, until the order is so terminated.
   (c) If the commissioner finds that the factors set forth in
paragraphs (1) and (2) are true with respect to a subject person or
former subject person of a subject institution or holding company,
the commissioner may, without any prior notice or opportunity to be
heard, issue an order suspending or removing the subject person or
former subject person from his or her office, if any, with the
subject institution or holding company and prohibiting him or her
from further participating in any manner in the affairs of the
subject institution or holding company without the approval of the
commissioner:
   (1) That the subject person or former subject person has been
finally convicted of any crime of the type described in paragraph (1)
of subdivision (a). For purposes of this paragraph, an agreement to
enter a pretrial diversion or similar program is deemed to be a
conviction.
   (2) That continued or resumed service or participation by the
subject person or former subject person may pose a threat to the
interests of the customers of the subject institution or may threaten
to impair public confidence in the subject institution.
   (d) The fact that any subject person of a subject institution
charged with a crime of the type described in paragraph (1) of
subdivision (a) is not finally convicted of the crime does not
preclude the commissioner from issuing an order regarding the subject
person pursuant to any other provision of this article.



300.3.  (a) Any subject institution, subject person of a subject
institution, or former subject person of a subject institution to
whom an order is issued under Sections 300 to 300.2, inclusive, may
apply to the commissioner to modify or rescind the order. In deciding
whether to grant or deny the application, the commissioner shall
consider whether it is in the public interest to modify or rescind
the order and whether it is reasonable to believe that the subject
person or former subject person will, if and when he or she becomes a
subject person of a subject institution or holding company, comply
with all applicable provisions of law, or any regulation or order
issued by the commissioner.
   (b) The right of any subject person or former subject person of a
subject institution or holding company to whom an order is issued
under Sections 300 to 300.2, inclusive, to petition for judicial
review of the order shall not be affected by the failure of the
subject institution or holding company to apply to the commissioner
pursuant to subdivision (a) to modify or rescind the order.



300.4.  (a) In this section, "subject depository institution" means
any:
   (1) Licensee or any bank or credit union that maintains an office
in this state.
   (2) Affiliate of any of the institutions specified in paragraph
(1).
   (3) Subsidiary of any of the institutions specified in paragraph
(1).
   (4) Holding company of any of the institutions specified in
paragraph (1).
   (b) It is unlawful for any subject person or former subject person
of a subject institution to whom an order is issued under Sections
300 to 300.2, inclusive, willfully to do, directly or indirectly, any
of the following without the approval of the commissioner, so long
as the order is in effect:
   (1) Act as a subject person of any subject depository institution.
   (2) Vote any shares or other securities having voting rights for
the election of any person as a director of a subject depository
institution.
   (3) Solicit, procure, transfer or attempt to transfer, or vote any
proxy, consent, or authorization with respect to any shares or other
securities of a subject depository institution having voting rights.
   (4) Otherwise to participate in any manner in the affairs of any
subject depository institution.



301.  The commissioner may revoke or suspend any license issued by,
or under the authority of, the commissioner, if, after notice and
opportunity to be heard, the commissioner finds any of the following:
   (a) The licensee has violated, is violating, or that there is
reasonable cause to believe that the licensee is about to violate,
any provision of any of the following:
   (1) Any division subject to the jurisdiction of the commissioner.
   (2) Any regulation promulgated by, or subject to the jurisdiction
of, the commissioner.
   (3) A provision of any other applicable law.
   (4) A provision of any order issued by the commissioner.
   (5) A provision of any written agreement between the licensee and
the commissioner.
   (6) A condition imposed on any written approval granted by the
commissioner.
   (b) Any fact or condition exists which, if it had existed at the
time of the original application for the license, would be grounds
for denying the application for the license.
   (c) The licensee is conducting its business in an unsafe manner.
   (d) The licensee is in such condition that it is unsafe or unsound
for the licensee to transact appropriate licensee business.
   (e) The licensee has inadequate capital or net worth or is
insolvent.
   (f) The licensee failed to pay any of its obligations as they came
due or is reasonably expected to be unable to pay its obligations as
they come due.
   (g) The licensee is the subject of an order for relief in
bankruptcy, or has sought other relief under any bankruptcy,
reorganization, insolvency, or moratorium law, or any person has
applied for any such relief under any such law against the licensee
and the licensee has by any affirmative act approved of, or consented
to, the action or the relief has been granted.
   (h) The licensee has ceased to transact appropriate licensee
business.
   (i) The licensee refuses to submit its books, papers, and affairs
to the inspection of any examiner.
   (j) Any officer of the licensee refuses to be examined upon oath
touching the concerns of the licensee.
   (k) The licensee has, with the approval of its board, requested
the commissioner to take possession of its property and business.



301.1.  If the commissioner finds that any of the factors set forth
in Section 301 is true with respect to any licensee and that it is
necessary for the protection of the public interest, the commissioner
may issue an order immediately suspending or revoking the licensee's
license.


302.  If the commissioner finds that any of the factors set forth in
subdivisions (a) to (k), inclusive, is true with respect to a
licensee, the commissioner may by order, without any prior notice or
opportunity to be heard, take possession of the property and business
of the licensee:
   (a) The licensee has violated any provision of (1) any division
subject to the jurisdiction of the commissioner, (2) any regulation
promulgated by, or subject to the jurisdiction of, the commissioner,
(3) any provision of any other applicable law, (4) any provision of
any order issued by the commissioner, (5) any provision of any
written agreement made between the commissioner and the licensee, or
(6) a condition imposed on any written approval granted by the
commissioner.
   (b) The licensee is conducting its business in an unsafe or
unsound manner.
   (c) The licensee is in such condition that it is unsafe or unsound
for the licensee to transact appropriate licensee business.
   (d) The licensee has inadequate capital or net worth or is
insolvent.
   (e) If the licensee is a bank, the tangible shareholders' equity
of the bank is less than the following:
   (1) If the bank is a commercial bank or industrial bank, the
greater of three percent of the bank's total assets or one million
dollars ($1,000,000).
   (2) If the bank is a trust company other than a commercial bank
authorized to engage in trust business, one million dollars
($1,000,000).
   (f) The licensee failed to pay any of its obligations as they came
due or is reasonably expected to be unable to pay its obligations as
they come due.
   (g) The licensee has applied for an adjudication of bankruptcy,
reorganization, arrangement, or other relief under any bankruptcy,
reorganization, insolvency, or moratorium law, or that any person has
applied for any such relief under any such law against the licensee
and the licensee has by any affirmative act approved of or consented
to the action or the relief has been granted.
   (h) The licensee has ceased to transact the business the licensee
is authorized to conduct pursuant to its license.
   (i) The licensee refuses to submit its books, papers, and affairs
to the inspection of any examiner.
   (j) Any officer of the licensee refuses to be examined upon oath
touching the concerns of the licensee.
   (k) The licensee has, with the approval of its board, requested
the commissioner to take possession of its property and business.



302.1.  (a) If the commissioner takes possession of the property and
business of a licensee pursuant to Section 302, the licensee may,
within 10 days, apply to the superior court in the county where its
head office is located to enjoin further proceedings. The court may,
after citing the commissioner to show cause why further proceedings
should not be enjoined and after a hearing, dismiss the application
or enjoin the commissioner from further proceedings and order the
commissioner to surrender the property and business of the licensee
to the licensee or make any further order as may be just. The
judgment of the court may be appealed by the commissioner or by the
licensee as allowed by law.
   (b) At any time after the commissioner takes possession of the
property and business of a licensee pursuant to Section 302, the
licensee may, with the approval of the commissioner, resume business
upon conditions as the commissioner may prescribe.



302.2.  (a) Upon taking possession of the property and business of
any licensee, the commissioner shall give notice of that fact to all
persons holding or having in their possession any assets of the
licensee. No person knowing of the taking, or who has been notified
thereof, shall have a lien or charge upon any assets of the licensee
for any payment, advance, or clearance thereafter made or for any
liability thereafter incurred.
   (b) The giving of notice in accordance with this section shall not
be deemed to be a prerequisite to the taking of possession of the
property and business of the licensee.



302.3.  The commissioner is deemed to take possession of the entire
property and business of a licensee when the commissioner takes
possession of the business and property of the head office of the
licensee.

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