Texas § IN.887.054 - FINANCIAL OFFICER

§ IN.887.054. FINANCIAL OFFICER

FINANCIAL OFFICER; BOND. (a) An association, by resolution entered in its minutes, shall designate an officer to be responsible for handling the association's funds. The president, secretary, or general manager of the association must certify a copy of the resolution, and the association shall file the copy with the department. (b) Except as provided by Subsection (c) or (d), the association shall make and file a surety bond covering the officer designated under Subsection (a). The bond must: (1) be issued by a corporate surety company authorized to issue surety bonds in this state; (2) be satisfactory to the department and payable to the department for the use and benefit of the association; (3) obligate the principal and surety to pay any monetary loss sustained by the association through an act of fraud, dishonesty, forgery, theft, embezzlement, or wilful misapplication by the officer, whether acting alone or with other persons, while employed as or exercising the powers of an officer designated under Subsection (a); and (4) be in an amount of: (A) at least $2,500; or (B) if the association's mortuary fund exceeds $2,500, an amount equal to the lesser of: (i) the amount of the association's mortuary fund; or (ii) $20,000. (c) Instead of the bond required by Subsection (b), the officer designated under Subsection (a) may deposit with the department cash or securities approved by the department in the amount and subject to the conditions applicable to the bond. (d) Except as provided by Subsection (e), this section does not apply to a local mutual aid association that was operating on May 12, 1939, and has never: (1) had a total membership of more than 1,000 members; (2) charged more than $1 each for annual dues and assessments; and (3) charged more than $2.50 for membership fees. (e) An association to which Subsection (d) applies must file with the department a bond in the amount of $1,000, conditioned as provided for a bond under Subsection (b). (f) Successive recoveries may be made on a bond under this section until the amount of the bond is exhausted. Added by Acts 2001, 77th Leg., ch. 1419, Sec. 1, eff. June 1, 2003.