Texas Credit Services Organization (CSO) Bonds

The bond requires that the Credit Service Organization ("CSO") complies with Chapter 393, Finance Code, as presently worded and amended, and all other applicable rules and regulations established by the secretary of state. The bonded CSO is further obligated to faithfully discharge all duties and responsibilities under the Code and any party financially harmed due to the bonded principal's failure to meet the conditions of the bond may bring an action on the bond to recover damages suffered while the surety bond was actively in force.

Section 393.302 of the Texas Finance Code stipulates that a seller of credit services in the Texas may not charge or collect from a buyer before completing performance of all services the seller agreed to perform unless the credit services organization has obtained certain security required by the state to protect the buyer. The security must be in the form a surety bond or an established surety account held by the state. The surety bond must be purchased from a surety company authorized to do business in Texas such as Surety Bonds Direct and its surety carrier partners. A separate surety bond in the amount of $10,000 must be furnished for each location.