No. They specifically gave him citation because he was working for an owner builder and all of the work combined on the project was over $500, but his part was under $500. I think that they are trying to make it harder for owners/builders to split big projects into $500. On the other hand, it is super difficult to prove your self-employed experience in order to get a license.
Even though they give out citations and perform sting operations, unlicensed contractors still take a risk because it is difficult to abide by rules of CSLB.