Surety Bond Encyclopedia

Immigration Assistance Provider ($50,000) Bond - City of New York, NY in New York

Brief Summary

Anyone in New York City who charges for help with immigration matters and is not an attorney or a qualifying nonprofit must keep a $50,000 bond in force for as long as they serve customers and for a full year after they stop. The bond is written on the city's own form, payable to the People of the City of New York, and a surety bond lets you meet the requirement for an annual premium instead of tying up $50,000 in a letter of credit.

New York City requires every immigration assistance service provider to maintain a $50,000 bond, contract of indemnity or irrevocable letter of credit payable to the People of the City of New York. The requirement comes from the Immigration Assistance Service Enforcement Act in Title 20, Chapter 5, Subchapter 14 of the NYC Administrative Code, and the city's bond form keeps coverage in place for one year after the provider stops doing business.

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How to Apply for a Immigration Assistance Provider ($50,000) Bond:

Confirm you are a provider under the city definition and not an exempt attorney, Board of Immigration Appeals recognized organization or no-fee nonprofit.
Total your immigration assistance fees for the last twelve months. Over $250,000 means the state 20 percent amount applies.
Have your legal business name and address exactly as they appear on your customer contracts.
Owner name, home address and Social Security number for the credit review.
Execute the city's Surety Bond for Immigration Assistance Service Providers form with the surety.
Post the 11 by 17 inch surety sign and prepare the customer disclosure sheet before taking clients.
Keep the bond in force for one year after you stop providing immigration assistance services.

Detailed Information About the New York Immigration Assistance Provider ($50,000) Bond:

Who has to carry it

The city defines a provider as any person, including a corporation, partnership, limited liability company, sole proprietorship or individual, that provides immigration assistance services. Several groups fall outside that definition: attorneys in good standing with the bar of the highest court of any state, tax-exempt nonprofits that charge no fee or only a nominal fee, organizations recognized by the federal Board of Immigration Appeals, authorized agencies under the New York Social Services Law, and elected officials or city employees acting in their official capacity without compensation. Everyone else who is paid for immigration assistance needs the bond.

The amount, and when the state asks for more

The city figure is a flat $50,000, and the city provision applies unless New York State law requires otherwise. State law sets the same $50,000 base in General Business Law section 460-f, but a provider that receives more than $250,000 in total fees and other compensation for immigrant assistance services during any twelve-month period must carry 20 percent of those fees instead. A provider that took in $400,000 in fees, for example, needs $80,000 of coverage.

What the bond guarantees

The bond protects any customer who does not receive a refund owed or is otherwise injured by the provider. Under the city form, the city and any aggrieved person can pursue the provider or the surety, and total liability never exceeds the $50,000 penal sum no matter how many claims are made or how many years the bond stays in force. The surety can cancel only by giving sixty days' written notice to the city and the provider.

Posting the surety information

City rule 6 RCNY 5-264 requires an 11 by 17 inch sign, displayed where customers can see it, stating that the provider carries the $50,000 surety and where claims can be filed. The same information must be given to each customer at contract signing on a separate sheet printed in at least 12 point bold type.

Eligibility and Requirements for a New York Immigration Assistance Provider ($50,000) Bond:

Penal sum of $50,000, payable to the People of the City of New York.
A bond, contract of indemnity or irrevocable letter of credit. A surety bond is the option that does not tie up cash.
Coverage for the entire period you provide services and for one year after you stop.
Surety name, address and claims contact shown to customers on the posted sign and the disclosure sheet.
Owner credit review. Credit shapes the premium rate the surety quotes.

New York Immigration Assistance Provider ($50,000) Bond FAQs:

Who is exempt from the bond?

Attorneys in good standing with the bar of the highest court of any state, tax-exempt nonprofits that charge no fee or a nominal fee, organizations recognized by the federal Board of Immigration Appeals, authorized agencies under the New York Social Services Law, and elected officials or city employees acting in their official capacity without compensation. These are excluded from the definition of provider.

Is the amount always $50,000?

The city amount is $50,000. Under New York General Business Law section 460-f, a provider that receives more than $250,000 in fees and other compensation for immigrant assistance services in any twelve-month period must carry 20 percent of those fees.

Can I cancel the bond when I close my office?

No. The bond must stay in force for one year after you cease doing business as an immigration assistance provider, so customers still have a way to recover refunds and losses after you close.

Who can make a claim?

Any customer who does not receive a refund owed or is otherwise injured by the provider. Under state law, the Attorney General can also bring the action on a customer's behalf against the provider and the surety.

How is the premium set?

The surety quotes an annual premium based on the owner's credit, business history and financial strength, applied to the required bond amount. A provider in the state 20 percent tier pays more because the penal sum is larger.