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HomeFinancial CodeDiv. 1.1Ch. 16Art. 3§ 1575 Security Deposit Maintenance

§ 1575 Security Deposit Maintenance

Financial Code·California
AI Summary·Official Text·Key Terms·Related Statutes·References
AI SummaryVerified

§ 1575 Security Deposit Maintenance

If a security deposit loses value and falls below the required amount, you have to add more money or securities right away.

Key Takeaways

  • •Keep the security deposit at the amount the law requires.
  • •If its value falls, add enough money or other securities right away to bring it back up.
  • •The commissioner can look at the deposit’s value anytime and can charge a reasonable fee for the investigation.

Example

A business puts a $10,000 bond as a security for a state permit. After a market drop, the bond is now worth only $7,000, which is less than the $10,000 the law says is needed.

The business must quickly add $3,000 (or other securities) so the total deposit is back up to $10,000. The state commissioner can check the bond’s value now or later and can charge a reasonable fee for that check.

AI-generated — May contain errors. Not legal advice. Always verify source.

Official Source
View on CA.gov

§ 1575 Security Deposit Maintenance

Should any security deposited pursuant to this article so depreciate in value as to reduce the deposit below the amount required by this article, additional money or securities shall be deposited promptly in amount sufficient to meet such requirements. The commissioner may make an investigation of the value of any security deposited pursuant to this article, at the time such security is presented for deposit or at any time thereafter, whenever in his judgment such investigation is necessary. The commissioner may make such charge as may be reasonable and proper for such investigation. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)

Last verified: January 11, 2026

Key Terms

securitydepositcommissionerinvestigation

Related Statutes

  • § 1570 Trust Company Security Deposits
  • § 1571 Trust Company Deposit Requirements
  • § 1572 Trust Company Security Requirements
  • § 1573 Trust Fund Deposit Requirements
  • § 1574 Securities Exchange And Withdrawal

References

  • Official text at leginfo.legislature.ca.gov
  • California Legislature. Financial Code. Section 1575.
View Official Source