Surety Bond Insider

On June 6th, 2014, Colorado Governor John Hickenlooper signed HB 1398 into law.  As the growth, sale and possession of marijuana became legal in Colorado while remaining illegal under federal law, there was a lack of financial institutions and banks that were willing to provide financial services to marijuana businesses. This new legislation establishes marijuana financial services cooperatives in the state and, therefore, addresses this problem.

The official legislative declaration reads:

“(b) DECLARES THAT THIS LACK OF ACCESS TO FINANCIAL SERVICES HARMS THE PUBLIC INTEREST BY:

• (I) STIMULATING THE MARIJUANA BLACK MARKET’S COMPETITIVE ADVANTAGE BY INCREASING LICENSED MARIJUANA BUSINESSES’ COSTS OF DOING BUSINESS;
• (II) INCREASING THE CRIME RATE ASSOCIATED WITH LICENSED MARIJUANA BUSINESSES DUE TO THE LARGE AMOUNTS OF CASH THAT MUST BE KEPT ON PREMISES; AND
• (III) IMPEDING COLORADO’S ABILITY TO TRACK AND INDEPENDENTLY VERIFY THE ACCOUNTING OF LICENSED MARIJUANA BUSINESSES’ REVENUES; AND

(c) DECLARES THAT THE ENACTMENT OF THIS ARTICLE, BY AUTHORIZING THE FORMATION OF MARIJUANA FINANCIAL SERVICES COOPERATIVES, IS NECESSARY FOR THE PROMOTION AND PRESERVATION OF THE PUBLIC WELFARE.”

To keep the marijuana financial services industry free of unethical and unlawful business professionals, the state of Colorado has introduced a surety bond requirement that all marijuana financial service businesses must fulfill to comply with the laws of the state and industry and legally do business. The surety bond must be in an amount equal to the assets of the cooperative as of December 31st of the previous year or $1 million, whichever amount is lesser in value. As a marijuana financial services cooperative becomes established in the state and begins to appoint its board of directors and appointed officials, a blanket surety bond to cover all board members must be obtained.

For more information about the legal requirements of marijuana financial services cooperatives in Colorado, you can find the full text of HB 1398 here.

The experts at SuretyBonds.com are familiar with this new bond requirement and are ready to assist you with all of your bonding needs. When you’re ready to get bonded, give us a call at 1 (800) 308-4358 Monday through Thursday between 7 a.m. and 7 p.m. CST and between 7 a.m. and 6 p.m. CST on Friday. Or, you can fill out our instant online contact form. You’ll be connected with an expert surety specialist who will walk you through each step of the bonding process.

On June 3, Governor Dannel Malloy of Connecticut signed HB 5353 into law. This bill sets new licensing requirements, specifically that any person acting as a mortgage servicer must obtain a license from the banking commissioner for his or her main office and each branch office from which he or she conducts business. This requirement goes into effect on January 1, 2015.

This licensing change renames mortgage servicing companies as “mortgage services” and does the following and more:

• modifies who is subject to licensure
• expands the list of services subject to licensure
• adds new licensing, application, fees, bonding and recordkeeping requirements
• specifies standards of conduct for mortgage professionals

The bill requires Connecticut mortgage servicers to post a $100,000 surety bond per place of business. The new law also states that additional bonds may be required based upon the financial standing of a mortgage servicer or mortgage lender licensee. The surety bond ensures the honest performance of all mortgage agreements, the trustworthy accounting of all funds associated with the mortgage business, and the conducting of business in compliance with all applicable laws. This bonding requirement goes into effect on October 1, 2014.

Mortgage servicers in Connecticut are also required to post fidelity bond and errors and omissions coverage. The fidelity bond is based on the mortgage servicer’s volume of servicing activity with the minimum amount required being $300,000. This coverage may provide for a deductible amount not to exceed the greater of $100,000 or 5% of the principal amount

The experts at SuretyBonds.com are ready to assist you with all of your bonding needs. When you’re ready to get bonded, give us a call at 1 (800) 308-4358 Monday through Thursday between 7 a.m. and 7 p.m. CST and between 7 a.m. and 6 p.m. CST on Friday. Or, you can fill out our instant online contact form. You’ll be connected with an expert surety specialist who will walk you through each step of the bonding process.