Bankruptcy is a serious matter and the federal government expects a high level of protection from auctioneers. The same standard applies in other federal auctioneer license bond cases, as well. In order for an auctioneer to be fully licensed, they must secure a federal auctioneer license bond. While an auctioneer must also comply with local and state license mandates, these do not satisfy federal mandates.
In every bankruptcy case a trustee is appointed. The trustee is responsible for handling of the estate. They are the ones who choose the bankruptcy auctioneer. In the event any misuses occur, the trustee will be held responsible. To cover all their bases, the federal government and the trustee requires a bankruptcy auctioneer bond.
Without the protection of a federal auctioneer license bond, an estate could suffer a financial loss and not have a way to recover. This type of bond is also used as a defense against fraudulent bankruptcy practices.
A bankruptcy auctioneer bond protects the estate against unlawful action on the part of the auctioneer. Should any of the following happen an auctioneer bond would provide recourse:
The federal government routinely relies on surety bonds to provide protection to both consumer and citizen. It should be noted that securing a bankruptcy auction bond is not the only requirement to become an auctioneer.
The cost of a federal auction bond varies based on the surety bond amount. Bond experts at Jurisco works with clients to determine the necessary value of the bond. Then they can find the best way to deliver the lowest cost.
A bankruptcy auction bond generally only applies to one bankruptcy. However, the auction bond can be written in such a way that it serves as a “blanket” bond over the course of multiple bankruptcies. Not sure what type of federal bankruptcy auctioneer bond terms apply to your situation? Contact the bond experts at Jurisco for more information.