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Assuming that petitioner's excess value activity might have
been considered "insurance" subject to regulation under various
State laws, petitioner's "restructured" method of handling EVC's
would also seem to violate State laws. For example, in some
States the sale or solicitation of insurance without
authorization is a violation of State statutes. See, e.g., Cal.
Ins. Code sec. 700 (West 1993);36 N.Y. Ins. Law sec. 109(a)
36Cal. Ins. Code sec. 700 (West 1993) provides:
�700. Admittance required; penalties; compliance; hearings;
issuance of certificate
(a) A person shall not transact any class of
insurance business in this state without first being
admitted for that class. Admission is secured by
procuring a certificate of authority from the
commissioner. The certificate shall not be granted
until the applicant conforms to the requirements of
this code and of the laws of this state prerequisite to
its issue.
(b) The unlawful transaction of insurance business
in this state in willful violation of the requirement
for a certificate of authority is a public offense
punishable by imprisonment in the state prison, or in a
county jail not exceeding one year, or by fine not
exceeding one hundred thousand dollars ($100,000), or
by both, and shall be enjoined by a court of competent
jurisdiction on petition of the commissioner.
Cal. Ins. Code sec. 35 (West 1993) provides:
�35. Transact
"Transact" as applied to insurance includes any of
the following:
(a) Solicitation.
(continued...)
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