Surety Bond News

Debt consolidating agencies are affected by a new law introduced in the state of Oregon. The new law, which is referred to as HB 2191, redefined debt consolidating agencies as “debt management service providers’ and modified the present $10,000 surety bond requirement so that this quantity now is the minimum requirement. HB 2191 also terminated the required fidelity bond for consolidating agency’s who are incorporated under the federal Internal Revenue Code. The Director of the Department of Consumer and Business Services may establish the surety bond quantity. The new law authorizes direct actions on the surety bond. HB 2191 became active upon enactment.

SB 355 is a new bill that was introduced in the state of Nevada relating to debt-management service providers. The new bill implements the Uniform Debt Management Services Act of the National Conference of Commissioners of Uniform State Law. SB 355 requires debt-management service providers to acquire a $50,000 surety bond. The attorney General has the option to boost or reduce the required quantity of the surety bond based on specific conditions of the licensee. The new bill asks the sureties to have an “A” rating from a nationally acknowledged rating system and must be licensed within the State. The surety bond runs to the State for its advantage and for those who enter in to agreements with the provider. The surety bond must be active for a supplementary two years after the registrant halts practice of debt-management services in Nevada. SB 355 authorizes a certificate of insurance or a letter of credit in place of a surety bond. The new bill becomes active “upon passage and approval for the purpose of adopting regulations and performing any other preparatory administrative tasks that are necessary to carry out the provisions of this act; and…on July 1st, 2010, for all other purposes.”

New legislation was introduced in the State of Oklahoma regarding civil litigation cases. The new law is labeled HB 1603 and caps appeal bonds in civil litigation cases at $25 million. Present legislation caps the surety bond for these cases at 100% of the judgment, exclusive of interest and expenses. The present law allows judgment debtors that can demonstrate that they will undergo considerable financial damage, as stated in the law, by having to attain the appeal bond, can have the surety bond quantity decreased. HB 1603 states that subject to these conditions, the surety bond is capped at $25 million.

Additionally, for cases concerning the Tobacco Master Settlement Agreement, the present cap has been modified so that the surety bond quantity can be equivalent to 10% of the net worth of the judgment debtor. The present law already capped the surety bond quantity at 100% of the judgment, excluding interest and expenses, or $25 million, whichever is less. HB 1603 caps the surety bond for tobacco cases at the least of these three quantities. The new law became active on November 1st, 2009.

Oregon State implemented a new law relating to mortgage brokers and bankers. The new law is named HB 2189 and requires mortgage bankers and mortgage brokers to acquire a surety bond or a letter of credit (LOC) to cover the actions of the loan originators. The surety bond has to cover the broker’s or the banker’s actions if no originators are employed. The quantity of the surety bond required will be determined by regulations, but it must be at least $50,000 under the new law. The previous law required bankers and brokers to attain a $25,000 surety bond or LOC, plus $10,000 per branch. The surety bond/LOC was capped at $50,000. HB 2189 became active upon enactment.

Notaries are affected by a new Nevada State law referred to as SB 92. The new law allows the Secretary of State to appoint notaries public for electronic documents. The electronic notaries will be subject to the present surety bond requirement required of notaries of paper documents. The law requires a surety bond in the amount of $10,000. In addition to the specifications for the surety bond and the surety company provided in present law, the surety bond also must guarantee cooperation with SB 92’s requirements relating to the appointment requirements for an electronic notary and the notarization of electronic documents. SB 92 became active upon enactment.