IMPACT OF THE PENAL CODE AND OTHER STATUTES
Corporations Code
Some of the activities which constitute crimes under the Corporations Code relate to the sale of securities. A
conspiracy to violate the California Corporate Securities Act is a crime. (PC 182; Corporations Code Section
25540)
The sale of fractionalized interests in promissory notes secured by deeds of trust may result in the sale of
corporate securities subject to qualification or exemption with the California Department of Corporations.
Without such qualification or exemption, the sales are illegal and the broker or offeror could be convicted of a
crime.