State Codes and Statutes

Statutes > Connecticut > Title36a > Chap669 > Sec36a-802

      Sec. 36a-802. (Formerly Sec. 42-128a). Surety bond required. Authority of commissioner to proceed on bond. Cancellation of bond; notice. Automatic suspension of license; notice. Opportunity for hearing. (a) No such license and no renewal thereof shall be granted unless the applicant has filed with the commissioner a bond to the people of the state in the penal sum of five thousand dollars, approved by the Attorney General as to form and by the commissioner as to sufficiency of the security thereof. Such bond shall be conditioned that such licensee shall well, truly and faithfully account for all funds entrusted to the licensee and collected and received by the licensee in the licensee's capacity as a consumer collection agency. Any person who may be damaged by the wrongful conversion of any creditor, consumer debtor or property tax debtor funds received by such consumer collection agency may proceed on such bond against the principal or surety thereon, or both, to recover damages. The commissioner may proceed on such bond against the principal or surety thereon, or both, to collect any civil penalty imposed upon the licensee pursuant to subsection (a) of section 36a-50. The proceeds of the bond, even if commingled with other assets of the licensee, shall be deemed by operation of law to be held in trust for the benefit of such claimants against the licensee in the event of bankruptcy of the licensee and shall be immune from attachment by creditors and judgment creditors. The bond shall run concurrently with the period of the license granted to the applicant, and the aggregate liability under the bond shall not exceed the penal sum of the bond.

      (b) The surety company shall have the right to cancel the bond at any time by a written notice to the licensee stating the date cancellation shall take effect. Such notice shall be sent by certified mail to the licensee at least thirty days prior to the date of cancellation. A surety bond shall not be cancelled unless the surety company notifies the commissioner in writing not less than thirty days prior to the effective date of cancellation. The commissioner shall automatically suspend the license on the date the cancellation takes effect, unless the surety bond has been replaced or renewed. The commissioner shall give the licensee notice of the automatic suspension pending proceedings for revocation or refusal to renew and an opportunity for a hearing on such actions in accordance with section 36a-51.

      (1971, P.A. 539, S. 4; P.A. 02-111, S. 48; P.A. 03-262, S. 2; P.A. 04-69, S. 31.)

      History: Sec. 42-128a transferred to Sec. 36a-802 in 1995; P.A. 02-111 amended section by changing "him" to "the licensee", changing "him in his" to "the licensee in the licensee's", changing "trust funds" to "creditor, consumer debtor or property tax debtor funds" and adding provision authorizing commissioner to proceed on bond to collect civil penalty imposed on licensee pursuant to Sec. 36a-50(a); P.A. 03-262 substituted "funds received" for "funds held" and made a technical change, effective July 9, 2003; P.A. 04-69 designated existing provisions as Subsec. (a) and added Subsec. (b) re cancellation of surety bond and automatic suspension of license.