Section 7450.2 Of Article 5. Investment In Loans From California Financial Code >> Division 2. >> Chapter 6. >> Article 5.
7450.2
. 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.
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).