§ 1470 Bank Affiliate Control Definitions

• •Affiliate means a person or company that is controlled by, controls, or shares control with another person, directly or indirectly through intermediaries.
• •Control is defined in Section 1250.
• •A regulated corporation is any corporation or LLC that a bank both invests in and controls.
• •Securities include any debt, equity, or other security issued by a person and also by its affiliates.
• •These definitions apply when a bank makes an equity investment and controls the entity.

A bank invests in a small tech startup and also owns another company that shares the same owners. Because the bank controls both companies, they are considered "affiliates" and the startup's stock is treated as a "security" under the rule.

Since the bank both invests in and controls the startup, the startup becomes a "regulated corporation," and any shares it issues are "securities" covered by this statute.