Section 58-9-7 - Evidence of financial responsibility required.
58-9-7. Evidence of financial responsibility required.
A. No corporation shall obtain a certificate without securing and filing with the commissioner [director of the financial institutions division of the regulation and licensing department] a surety bond, or otherwise establishing to the commissioner's [director's] satisfaction such corporation's financial responsibility.
B. For a corporation organized and engaged in the trust business prior to the effective date of the Trust Company Act [58-9-1 NMSA 1978], the amount of the surety bond, if financial responsibility is not otherwise established to the commissioner's [director's] satisfaction, shall be not less than twenty-five percent of the aggregate value of the property, money or other valuables held in trust as of the first day of the month in which the application for a certificate is filed.
C. For a corporation not engaged in the trust business prior to the effective date of the Trust Company Act, the amount of the surety bond, if financial responsibility is not otherwise established to the commissioner's [director's] satisfaction, shall be one hundred thousand dollars ($100,000).
D. On or before the first day of March of each year beginning with the year 1974, every trust company shall increase its surety bond, if financial responsibility is not otherwise established to the commissioner's [director's] satisfaction, to an amount equal to twenty-five percent of the aggregate value of the property, money or other valuables held in trust as of the last day of the preceding year if the amount of its surety bond is less than twenty-five percent of the aggregate value of the property, money or other valuables held in trust.
E. In no event shall the amount of the surety bond, if financial responsibility is not otherwise established to the commissioner's [director's] satisfaction, be less than one hundred thousand dollars ($100,000) nor more than five hundred thousand dollars ($500,000).
F. The surety bond or other evidence of financial responsibility required by this section shall be for the benefit of:
(1) any person damaged as a result of a violation of the provisions of, or any regulation or rule promulgated pursuant to, the Trust Company Act;
(2) any person damaged by the negligence, fraud or embezzlement of a certified trust company or its directors, officers or employees; and
(3) any person damaged by any other breach of trust of any certified trust company.
G. The commissioner [director] shall revoke the certificate of any trust company which fails to maintain a bond or to otherwise supply evidence of financial responsibility as required by this section.