Chap. 239.—An ACT to amend and re-enact sections 2 and 3 of an act entitled
“an act to encourage thrift and savings amongst industrial classes similar to
the encouragement afforded by building and loan associations and to authorize
the incorporation of industrial loan associations for the purpose of making small
loans to industrial classes on security and at a low rate of interest,’ approved
February 21, 1920, as heretofore amended, and to further amend the said act by
adding thereto four new sections, numbered 13, 14, 15 and 16, respectively.
[S B 290]
Approved March 23, 1932

1. Be it enacted by the general assembly of Virginia, That sections
two and three of an act entitled “an act to encourage thrift and savings
amongst industrial classes similar to the encouragement afforded by
building and loan associations and to authorize the incorporation of
industrial loan associations for the purpose of making small loans to
industrial classes on security and at a low rate of interest,” approved
February twenty-first, nineteen hundred and twenty, as heretofore
amended, be amended and re-enacted, and that the said act be further
amended by adding thereto four new sections, numbered thirteen, four-
teen, fifteen, and sixteen, respectively, so that the said amended sections
and the said new sections shall read as follows:

Section 2. No industrial loan association shall be incorporated with
a capital less than thirty thousand dollars, which shall be fully paid in
cash before commencing business. Hereafter all subscriptions to the
capital stock of any industrial loan association incorporated under the
laws of the State of Virginia shall be paid in money at not less than
par, and no commissions, fees, brokerage, or other compensation of
any kind, shall be paid, either directly or indirectly, to any person, firm,
association or corporation for the sale of such stock. Every associa-
tion hereafter incorporated under this act shall have as a part of its
title the words “industrial loan,’ which shall not be used disjunctively,
but such association need not have as a part of its name the word
“corporation” or “incorporated.” No industrial loan association of a
mutual character shall be incorporated. If the provisions of this section
in reference to subscriptions to and the sale of the capital stock of
such associations are violated by any industrial loan association hereto-
fore or hereafter incorporated under the laws of this State, it shall be
liable to a fine of one thousand dollars, to be imposed and judgment
entered therefor by the State corporation commission and enforced
by its process..

Section 3. Before any industrial loan association shall begin busi-
ness it shall obtain a certificate of authority to do business from the
State corporation commission, and prior to the issuance of such cer-
tificate the State corporation commission shall ascertain that all provi-
sions of law have been complied with; that the required amount of
capital stock has been properly paid in in cash, that the director’s
oaths have been taken and subscribed, that there is a public need for
the facilities afforded by industrial loan associations, or additional
facilities as the case may be, in the community where the association
proposes to operate, and that the officers and directors of the proposed
association have the requisite moral fitness, financial responsibility, and
business qualifications for the proper operation of the said association.
Upon the entry of an order by the State corporation commission refus-
ing such certificate of authority an appeal may be had by any party
in interest aggrieved thereby. For any violation of this section such
association shall be subject to a fine of not less than twenty-five dollars
nor more than one hundred dollars per day for each days’ violation,
said fine to be imposed and judgment entered by the State corporation
commission and enforced by its process.

Section 13. If, upon the examination of any industrial loan associa-
tion as provided for in section ten hereof, the State corporation com-
mission shall ascertain that the laws of the State relating to industrial
loan associations are not being fully observed, or that any irregularities
are being practiced, or that the capital has been or is in danger of being
impaired, the said commission shall give immediate notice thereof to
the officers of such association and demand that the said irregularities
shall be promptly corrected, or that the impairment of the capital stock
shall be made good, and upon failure so to do within a reasonable time,
not exceeding thirty days after such notice, may provide for the ap-
pointment of a receiver to take charge of the business affairs and assets
of said association and to wind up its affairs as hereinafter provided.

Section 14. If, however, upon the examination of any such as-
sociation, it shall be found to be insolvent, or it is deemed necessary
by the State corporation commission for the protection of the public
interests, the commission may at once close the doors of such associa-
tion without any notice whatever, and the chief examiner of banks, or
one of his assistants, shall take charge of the books, assets and affairs
of such association until the appointment of a receiver as provided
by law.

Section 15. In any case the State corporation commission may,
and it shall be its duty, whenever, in its judgment, it is necessary for
the protection of the interests of the State or of the creditors of any
such association doing business in this State, to apply to any court in
this Commonwealth having jurisdiction to appoint receivers, for the
appointment of a receiver to take charge of the business affairs and
assets and to wind up the affairs and business of any such association
failing to comply with the requirements of the State corporation com-
mission, or found upon examination to be insolvent or unable to meet
its obligations and the legal demands made upon it in the ordinary
course and conduct of its business.

Such receiver when appointed shall be and become assignee of the
assets and property of such association, and shall be vested with all
the power and authority:conferred upon or exercised by receivers for
banks of discounts and deposit and/or trust companies under the Vir-
ginia banking act, or under general law.

Section 16. Each official communication directed by the State cor-
poration commission, or any State bank examiner, to any industrial
loan association, or to any officer thereof, relating to an examination
or investigation conducted or made by the banking department of the
State corporation commission, or containing suggestions or recom-
mendations as to the conduct of the association, shall, if required by
the authority submitting the same, be submitted by the officer or direc-
tor receiving it to the executive committee or board of directors of such
association and duly noted in the minutes of such meeting. The receipt
and submission of such notice to the executive committee or board of
directors shall be certified to the State corporation commission, within
such time as it may require, by at least three members of such com-
mittee or board. Any such association failing to comply with the
provisions of this section within thirty days after being called upon by
the State corporation commission for stch certificate shall be fined not
less than one hundred nor more than one thousand dollars, said fine
to be imposed and judgment entered by the State corporation com-
mission and enforced by its process.