California · Financial Code

FIN §31825: It shall be unlawful for any licensee, directly or indirectly, to provide financing assistance to discharge, or to free other funds for use in discharging, in whole or in part, an obligation to any as

Civil

What this law says, in plain English

Licensees are prohibited from providing financing assistance to discharge obligations owed by their associates, with an exception for normal business credit or short-term financing transactions.

Read the full statutory text

It shall be unlawful for any licensee, directly or indirectly, to provide financing assistance to discharge, or to free other funds for use in discharging, in whole or in part, an obligation to any associate of such licensee; provided, however, that this section shall not apply to any transaction effected by an associate of a licensee in the normal course of such associate’s business involving a line of credit or short-term financing assistance.

Verify at the official source: California legislative text

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This page is legal information, not legal advice. Code text is sourced from official publications and may lag amendments — always confirm at the official source linked above. Plain-English summaries and relationship data are AI-derived and reviewed on an ongoing basis; verify with a licensed attorney before acting.