Employee Dishonesty and Fidelity bonds are not typically required by a State/City/County but with this bond, you protect your customers from losses incurred as a result of theft committed by unethical employees.
According to Employee Retirement Income Security Act (ERISA), every fiduciary of an employee benefit plan and every person who handles funds of such plan shall be bonded in an amount equal to 10% of the funds handled (subject to a maximum of $500,000 or $1,000,000 when employer securities are included). If the plan includes non-qualifying assets, the bond amount is the greater of 10% of plan assets being handled or the value of the non-qualifying assets, whichever is greater (subject to limits stated above).
If the money manager who works directly for the retirement plan mismanages funds, the bond will hold that individual liable for losses. The bond amount can then be used to reimburse individuals for funds lost as a result of the fiduciary’s financial mismanagement. As such, a fiduciary’s bond amount must be reviewed and updated annually as the plan’s assets change.
ERISA surety bonds are not required for SEC-registered brokers and dealers that are subject to fidelity bond mandates of their own regulatory agency or organization.
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Get your free, no obligation quote within 24 hours or less. Apply for your Freight Broker Bond (BMC-84) online today! We offer Freight Broker Bonds (BMC-84) with only a credit check and completed bond application. We do not require personal financial statements, business financial statements or tax returns to process your application.
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The Federal Motor Carrier Safety Administration (FMCSA) requires all freight brokers and freight forwarders to file either a Freight Broker Bond (BMC-84) or a trust fund agreement (BMC-85). Freight Broker Bonds (BMV-84) are also known as Freight Bonds, ICC bonds (Interstate Commerce Commission), Truckers bonds and Freight forwarder bonds. Freight Broker and freight forwarders who do not meet the bond requirement can be fined up to $10,000. The bond requirement exists to guarantee that licensed freight brokers and forwarders complete their contracts and agreements and to prevent fraud or failure to pay motor carriers or shippers in a timely manner. If freight brokers or forwarders fail to comply with any terms of the surety bond, parties that suffer damages as a result may file a claim against the bond. If the claim is determined to be valid, the surety company will pay to settle the claim up to the full amount of the bond— $75,000. Once the claim has been resolved, it is the responsibility of the license holder to reimburse the surety the equivalent amount of money.
Should an applicant opt not to obtain a surety bond, another security option is to place the $75,000 into a trust fund by filing Form BMC-85. However, this option requires full collateral up front, so it is typically large brokers with established financial stability that choose this option. Newer freight brokers are encouraged to file a surety bond since it only requires an annual premium (typically 1.2% - 4% of the bond amount), rather than collateral.
A company who hires housekeepers, maid services, or residential cleaning services, may wish to have this bond in place to cover any acts of dishonesty or theft possibly made by that employee. With this bond in place, you not only will protect your business, but also your customers from losses that may incur as a result of theft committed by unethical employees.