Series 63 practice questionhardNotification of Bonding Claims
An agent’s surety bond is subject to a claim. According to the USA, what must the Administrator do?
- ANotify the agent and allow a hearing before payment is made from the bond.✓ Correct answer
- BImmediately disqualify the agent from registration.
- COrder the surety to pay the claim and terminate the agent.
- DTake no action; the surety company handles all claims without oversight.
Explanation
Why A — Notify the agent and allow a hearing before payment is made from the bond.
The Administrator is responsible for due process before bond claims are paid, including notice and hearing (USA Section 202(e)). Automatic disqualification or termination is not allowed without due process.
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