Legal Question in Credit and Debt Law in California

"Guilty by association" has no legal meaning or relevance at all. It is not in any way shape or form a legal principal or concept. In addition, the legal concepts that might apply between "business associates," such as conspiracy or being an accessory to a crime, would depend on the exact details and evidence involved. It is not something that could even begin to be evaluated based on such incomplete and vague statements as, "business associate," "aware," and "not recording cash payments."