Broker-dealer bond cost
Massachusetts investment adviser bonds are required by the Secretary of the Commonwealth, Securities Division in the amount of $10,000.These bonds are subject to underwriting, which means the amount clients will pay for this bond is based directly on a review of their personal credit report. Applicants with strong credit history could pay as low as $100 for their Massachusetts investment adviser/broker-dealer bond!
Why this bond
Investment adviser bonds in Massachusetts protect the general public from any illegal activities performed by investment advisers and broker-dealers. These prohibited actions include:
- acting as an unregistered/unlicensed professional
- recommending a faulty or unreliable source for their own gain
- scamming a customer for compensation
- and more
If an investment adviser or broker-dealer violates his or her bond agreement and consumers experience financial loss, the surety underwriting company that produces the bond will cover all damages up to the full bond amount. The principal (investment adviser or broker-dealer) must then reimburse the surety for all damages paid out.
Investment adviser or broker-dealer bond details
There is not a specific bond form for Massachusetts broker-dealer bonds, so a generic surety bond form must be used. When filling out the bond form, be sure to note the type of business correctly.A power of attorney form must also be completed and submitted.
Become an investment adviser or broker-dealer
To become a licensed investment adviser or broker-dealer in Massachusetts , applicants must:
- post a surety bond
- pay all necessary fees
- pass required examinations on general securities principles and state security laws
- submit to a thorough background check
- agree to meet certain record-keeping and disclosure requirements
- and more
Apply for your surety bond
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