Immigration Consultant Bond
Immigration consultant bonds are required of all certified immigration consultants in this country. Bonds must be maintained in a valid status for as long as that consultant is in business. The purpose of this requirement is to enable certification from the appropriate organization or authority in the state of operation for any given consultant. For instance, an immigration consultant wishing to conduct business in the state of California would be required to obtain a bond before being certified by California state authorities for business.
Why are they important?
These bonds provide a high level of protection for the public and the state of operation, ensuring that clients are not taken advantage of or exploited in any way. It does not provide any safeguards whatsoever to the consultant who is required to take out the bond since that is not the party that requires protection during immigration consultancy.
Without this kind of the bond in place, there would be a much greater potential for unlawful activity from consultants, including misrepresentation of important facts or outright fraud. The fact that an immigration consultant has obtained a bond provides a clear indication to customers that the consultant will be abiding by the terms of all local and federal regulations, and that the consulting service itself will be legitimate and useful to the client.
Consultant bonds work in much the same way that other surety bonds do. The three main parties to an immigration consultant surety are the same as they would be for virtually all other sureties (the principal, the surety company, and the obligee). The principal is the consultant who is required to purchase the bond, the surety company is an organization that generally sells bonds and insurance, and issues the bond to the principal, and the obligee is the state agency or authority, which must certify the principal for business operations.
In the event that any of the state laws are violated during a specific immigration consultancy, the affected person will have the option to make a claim against the consultant’s immigration bond. If the claim is found to be legitimate and with merit, the surety company would then be obliged to pay the amount of that claim, after which in most cases it would be free to pursue the principal for reimbursement.
Who needs immigration consultant bonds?
Any individual who wishes to conduct a business involving immigration consultancy will be required to purchase an immigration bond before becoming certified for operation in a particular state. The specific state of operation will be a huge factor in determining how large the bond must be for you to conduct business. Each state will establish its bond amount requirement (the level of coverage that the consultant must purchase).
The cost of that bond to the consultant will be a percentage of the bond amount, with several other factors coming into play. For instance, the consultant’s credit score and overall financial condition will play a large role in the cost of the surety bond. This is because a surety company must protect itself against the possibility that any claim made by a customer will cause a principal to declare bankruptcy, and default on financial reimbursement to the surety company.
What are the requirements in California?
California requires that individuals who prepare immigration paperwork for the public maintain a $50,000, two-year bond. The bond must be filed with the California Secretary of State, which oversees the immigration consultants in California.
The bond does not replace errors and omissions insurance, which protect the consultant. According to the terms outlined in the prescribed bond form, a consultant must abide by the laws governing such activities in California.
Because of the higher amount of the Bond ($50,000), and the very nature of the work being performed as a consultant, the bond requires a credit check for approval and the cost will be higher than it would be for a $25,000, two-year California legal document assistant, or unlawful detainer assistant bond.
What happens if you don’t have one?
If you as a consultant aren’t bonded, it means that you lack the kind of assurance that it can provide to customers regarding your legitimacy and integrity. That being the case, customers would logically choose other business practitioners who do have a consultant bond, and at least provides some measure of protection for the client that there will be no misrepresentation of the law or information. In addition to that, if you do not have a consultant bond, you are unlikely to be approved for certification by any state which you apply to for doing business.
How can I get one?
Getting bonded is a fairly simple process for someone with legitimate business intentions. Since you already know the type you need to obtain, your first step would be to select a surety company to engage. NFP is one of the nation’s largest insurance and bond companies and is authorized to do business in every state.
You are also likely to find the most affordable rates for your bond with NFP. After you have filled out an online application form for the bond and submitted your application fee to us, you will be issued an indemnity agreement. This must be signed in the presence of a public official and returned to us.
Following receipt of your indemnity agreement, NFP will issue the bond itself, and your coverage period will begin.
What about bad credit?
If you as a consultant have a bad credit score, or if your company finances are not the best, there is still an opportunity for you to secure an immigration surety bond. Many surety companies will still accept your application, but there is a likelihood that you will be paying higher premiums because of the less desirable financial status.
As mentioned previously, applicants who lack good financial status, or who have had serious financial issues in the past, are viewed as being more likely to default when a claim is made by an unsatisfied customer. When that happens, the bonding company will generally suffer the full impact of any claim made against the immigration bond and will be required to pay the entire amount. A surety company must protect itself against the likelihood of financial losses by charging higher premiums.
If you are you are ready to purchase an immigration consultant bond California, contact our office today 800.863.3210. We know the questions to ask to ensure your immigration bond is issued correctly.