Powers Of The Commissioner - - CA Corporations

Section § 29540

This law allows the commissioner to take legal action if someone is suspected of breaking the rules set out in this law. The commissioner can ask the court to stop the person from continuing these actions and ensure they comply with the law. The court can appoint a monitor or other official to oversee the person's actions or assets. These court-appointed officials can take control of the person's business operations and may even file for bankruptcy on their behalf if needed. Also, if it's in the public's interest, the commissioner can ask for additional remedies like compensation for those harmed by the wrongdoing.

(a) Whenever it appears to the commissioner that any person has engaged, or is about to engage, in any act or practice constituting a violation of any provision of this law or any rule or order under this law, the commissioner may in his or her discretion bring an action in the name of the people of the State of California in the superior court to enjoin the acts or practices or to enforce compliance with this law or any rule or order under this law. 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 ancillary relief may be granted as appropriate.

A receiver, monitor, conservator, or other designated fiduciary or officer of the court appointed by the superior 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, including the filing of a petition for bankruptcy. 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 their exercising these powers or performing these duties pursuant to the order of, or with the approval of, the superior court.

(b) If the commissioner determines it is in the public interest, the commissioner may include in any action authorized by subdivision (a) a claim for ancillary relief, including, but not limited to, 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 additional relief.

commissioner discretion legal action public interest injunction restraint order court-appointed fiduciary monitor receiver conservator business operations control asset management bankruptcy filing authority ancillary relief restitution disgorgement

(Added by Stats. 1990, Ch. 969, Sec. 2.)

Section § 29541

This law section gives the commissioner the power to investigate potential violations of corporate law by individuals or entities, whether inside or outside of the state. The commissioner can demand evidence, subpoena witnesses, and compel the production of documents to aid these investigations. If someone refuses to comply with a subpoena, the superior court can enforce it and penalize the individual for contempt. Individuals must testify and provide documents, even if it could incriminate them, but they cannot be prosecuted based on that testimony, except for committing perjury or contempt while testifying.

(a) The commissioner in his or her discretion (1) may make public or private investigations within or outside of this state that the commissioner deems necessary to determine whether any person has violated or is about to violate any provision of this law or any rule or order hereunder, or to aid the enforcement of this law or in the prescribing of rules and forms under this law, and (2) may publish information concerning any violation of this law or a rule or order hereunder.

(b) For the purpose of any investigation or proceeding under this law, the commissioner or any officer designated by the commissioner may administer oaths and affirmations, subpoena witnesses, compel their attendance, take evidence, and require the production of any books, papers, correspondence, memoranda, agreements, or other documents or records which the commissioner deems relevant or material to the inquiry.

(c) In case of contumacy by, or refusal to obey a subpoena issued to, any person, the superior court, upon application by the commissioner, may issue to the person an order requiring him or her to appear before the commissioner or the officer designated by the commissioner, to produce documentary evidence, if so ordered, or to give evidence touching the matter under investigation or in question. Failure to obey the order of the court may be punished by the court as a contempt.

(d) No person is excused from attending and testifying or from producing any document or record before the commissioner, or in obedience to the subpoena of the commissioner or any officer designated by the commissioner or in any proceeding instituted by the commissioner, on the ground that the testimony or evidence (documentary or otherwise) required of him or her may tend to incriminate him or her or subject him or her to a penalty or forfeiture. However, no individual may be prosecuted or subjected to any penalty or forfeiture for or on account of any transaction, matter, or thing concerning which he or she is compelled, after validly claiming his or her privilege against self-incrimination, to testify or produce evidence (documentary or otherwise), except that the individual testifying is not exempt from prosecution and punishment for perjury or contempt committed in testifying.

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(Added by Stats. 1990, Ch. 969, Sec. 2.)

Section § 29542

This law allows a commissioner to stop someone from doing something illegal under corporate law. If the person disagrees, they can ask for a hearing within 30 days. A hearing should happen quickly, within 15 business days, unless both sides agree to wait longer. If no hearing is requested in time, the order becomes final and can't be challenged in court.

(a) If, in the opinion of the commissioner, any person is engaging or has engaged in any activity in violation of any provision of this law, or rule or order under this law, the commissioner may order the person to desist and refrain from the activity unless and until the activity will not be in violation of any provision of this law or any rule or order under this law.

(b) If after an order has been made under subdivision (a), a request for hearing is filed in writing within 30 days of the date of service of the order by the person to whom the order was directed, a hearing shall be held in accordance with the Administrative Procedure Act (Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code), and the commissioner shall have all of the powers granted under the Administrative Procedure Act. Unless the hearing is commenced within 15 business days after the request is filed (or the person affected consents to a later date), the order is rescinded.

If that person fails to file a written request for a hearing within 30 days from the date of service of the order, the order shall be deemed a final order of the commissioner and shall not be subject to review by any court or agency, notwithstanding Section 29563.

commissioner desist and refrain order hearing request Administrative Procedure Act final order court review violation corporate activity order service 30 days 15 business days challenging orders compliance enforcement

(Amended by Stats. 2022, Ch. 188, Sec. 4. (AB 2433) Effective January 1, 2023.)

Section § 29543

This law allows the commissioner to share evidence of a law violation with the Attorney General or local district attorney, who can then start criminal proceedings. The commissioner and their team can also help prosecutors with the case if needed.

The commissioner may refer the evidence that is available concerning any violation of this law, or of any rule or order under this law, to the Attorney General or the district attorney of the county in which the violation occurred, who may, with or without such a reference, institute appropriate criminal proceedings under this law. The commissioner and the commissioner’s counsel, deputies, or assistants may, upon request of the Attorney General or the district attorney, assist the prosecutor in presenting the law or facts at the trial.

commissioner law violation Attorney General district attorney criminal proceedings evidence referral trial assistance prosecutor support criminal law legal proceedings violation of law county prosecution commissioner's counsel law enforcement collaboration legal evidence handling

(Added by Stats. 1990, Ch. 969, Sec. 2.)

Section § 29544

This law states that anyone who intentionally breaks the rules of this law can be fined up to $25,000 for each offense. This money goes to the State Corporations Fund. The fines and penalties can be used along with other legal remedies to enforce the law. Any legal action to seek these penalties must be taken within four years of the violation.

(a) Any person who willfully violates any provision of this law, or who willfully violates any rule or order under this law, shall be liable for a civil penalty not to exceed twenty-five thousand dollars ($25,000) for each violation, which shall be assessed and recovered in a civil action brought in the name of the people of the State of California by the commissioner in any court of competent jurisdiction.

The penalty collected shall be paid to the State Corporations Fund to be used for the support of this division.

(b) As applied to the penalties for acts in violation of this division, the remedies provided by this section and by other sections of this division are not exclusive, and may be sought and employed in any combination to enforce this division.

(c) No action shall be maintained to enforce any liability created under subdivision (a) unless brought before the expiration of four years after the act or transaction constituting the violation.

civil penalty willful violation State Corporations Fund enforcement commissioner four-year limit court of competent jurisdiction support of this division combination remedies act or transaction liability enforcement

(Amended by Stats. 2003, Ch. 876, Sec. 3. Effective January 1, 2004.)

Section § 29545

This law allows the commissioner to take specific actions under a federal law related to commodity exchanges. It also clarifies that this section does not limit the commissioner’s authority under this law or any other law they enforce.

(a) The commissioner may take actions that are authorized by Section 13a-2 of Title 7 of the United States Code (Section 6d of the federal Commodity Exchange Act) as amended before or after the effective date of this section.

(b) Nothing in this section shall be construed as a limitation on the powers of the commissioner under this act or any other law administered by the commissioner.

commissioner authority commodity exchange Section 6d federal Commodity Exchange Act commissioner powers Section 13a-2 Title 7 commodity markets enforcement powers federal law actions Title 7 United States Code

(Amended by Stats. 2013, Ch. 335, Sec. 12. (SB 538) Effective January 1, 2014.)

Section § 29546

This law allows the commissioner to provide guidance through interpretive opinions when people or businesses ask for help understanding certain matters.

The commissioner in his or her discretion may honor requests from interested parties for interpretive opinions.

commissioner interpretive opinions requests guidance interested parties discretion understanding matters business inquiries decisions assistance clarification interpretation regulatory guidance financial regulations opinions request

(Added by Stats. 1990, Ch. 969, Sec. 2.)