§ 31405 Financing Assistance Restrictions

Financial Code·California

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Key Takeaways

•A licensed person cannot help a business that mainly gives money or advice to other businesses.
•A licensed person cannot give money to a business just so that business can lend money to others or pay off debts from lending money.

Example

If a bank is licensed and wants to give money to a small company that only helps other companies with loans.

The bank cannot do this because the small company’s main job is to help with money, and the law says licensed places can’t support businesses like that.

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

Official Source

View on CA.gov

§ 31405 Financing Assistance Restrictions

Except as otherwise provided in subdivisions (b), (c), and (d) of Section 31406: (a) No licensee shall provide financing assistance or management assistance to any business firm the primary business of which is to provide financing assistance or management assistance. (b) No licensee shall provide financing assistance to any business firm for the purpose of providing financing assistance to other persons or discharging, in whole or in part, any obligation incurred for such purpose. (Amended by Stats. 1987, Ch. 867, Sec. 24.)

Last verified: January 23, 2026

Key Terms

assistance obligation license management

References

Official text at leginfo.legislature.ca.gov
California Legislature. Financial Code. Section 31405.

Key Takeaways

Example

Key Terms

Related Statutes

References

Key Takeaways

Example

Key Terms

Related Statutes

References