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Why Bond Everybody

by Surety Admin 21. October 2010 15:10
What is the sense, you ask, of spending money to bond people who don't handle money or merchandise? How in the world could an employee manage to steal an appreciable amount of his employer's property?

It was such an employee that caused a New England textile mill to lose over $50,000. The employee managed to unlock the a warehouse door on certain evenings each week so that another person could remove thousands of bolts of cloth over a period of months before the loss was discovered.

A long-time employee of a candy manufacturer, a porter, used the same plan to steal $288,000 of boxed chocolates during a 17-month period. He sold them for a mesley $18,000.

One of the nation's largest electrical factories lost nearly a million dollars when eight men, who handled no money or merchandise, found a way to make such a big money dishonestly that their regular occupation became merely a blind for their operations. These men were research engineers who contracted with fictitious factories to make fictitious machinery and gadgets supposedly needed in their experiments.

For these reasons, this why it is necessary to bond everyone and secure a surety bond for employee dishonesty.

~Agents Bonding Guide
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Surety Blog Categories:  Commercial Bonds

Possible Increase In SBA Bond Amounts Continues

by Surety Admin 18. October 2010 14:58

Small Business Administration’s (SBA) Office of Surety Guarantees. On September 17, the SBA Office of Surety Guarantees issued an SBA Information Notice to all its employees notifying them that the revisions implemented under the American Recovery and Reinvestment Act (ARRA) are set to expire on September 30, 2010. At that time, the temporary contract ceilings of $5 million and $10 million will expire and the maximum eligible contract bond guarantee amount will return to $2 million. Furthermore, the revision allowing the Administrator discretion to determine the Program’s liabilities will also expire on September 30, 2010. 


Finally, the SBA is in the process of finalizing a rule that increases, subject to the availability of specific appropriations, the contract size it will guarantee size to $5 and $10 million with respect to major disasters.


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Surety Blog Categories:  Contract Bonds

Possible Increase in SBA 7a Loan Limits

by Surety Admin 18. October 2010 14:54
Federal S. 3835/S. 3836. In an attempt to make permanent the enhancements made to the SBA Surety Bond Guarantee Program through the American Recovery and Reinvestment Act (ARRA) of 2009, which are set to expire on September 30, Senator Ben Cardin (D-MD) offered an amendment to the Senate Small Business Jobs and Credit Act. The Senator’s amendment was not included in the Senate Small Business Jobs and Credit Act that was signed into law by the President on September 27.

The key provisions contained in this package included: increasing the SBA 7(a) loan limits from $2 million to $5 million and the SBA 504 loans from $1.5 million to $5.5 million, and microloans from $35,000 to $50,000. The bill also extends the ARRA small business lending program that eliminates the fees normally charged for loans through the SBA 7(a) and 504 loan programs and increases the government guarantees on 7(a) loans from 75% to 90%. NASBP has called upon Congress to make similar reforms to the SBA Surety Bond Guarantee Program, which we believe will further enhance the Program.

Additionally, Senator Cardin introduced a standalone bill (S.3835) which makes the increased surety bond guarantee limits, of $5 million and $10 million, and the provision that allows the Administrator discretion to determine the Program’s liabilities permanent. S. 3835 was referred to the Senate Committee on Small Business and Entrepreneurship on September 23rd
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Surety Blog Categories:  Contract Bonds

Contractor is disqualified because of surety bond's missing raised seal

by Surety Admin 18. October 2010 14:32

A Michigan contractor submitted the lowest bid for a West Virginia demolition project but ended up being disqualified because the surety bond he submitted had a gold foil seal rather than the required raised seal. The glitch not only cost Dore & Associates the $619,200 job, but it will also cost the town of Clarksburg an extra $58,800 for accepting the second-lowest bid.


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