(1) To be issued a wholesaler's license, powersports vehicle dealer's license, or used powersports vehicle dealer's license, an applicant must procure and file with the board evidence of a savings account, deposit, or certificate of deposit meeting the requirements of section 11-35-101 or a good and sufficient bond with a corporate surety duly licensed to do business within the state, approved as to form by the attorney general, and conditioned that the applicant not practice fraud or violate any of the provisions of this part 4 related to fraud or any rule promulgated by the board under this part 4 related to fraud. A powersports vehicle dealer or used powersports vehicle dealer need not furnish an additional bond, savings account, deposit, or certificate of deposit under this section if the dealer furnishes a bond, savings account, deposit, or certificate of deposit under section 44-20-112.
(2) (a) The purpose of the bond procured by the applicant in accordance with subsection (1) of this section and section 44-20-413 is to provide for the reimbursement for any loss or damage suffered by any retail consumer caused by fraud or by a violation of this part 4 related to fraud by a wholesaler, powersports vehicle dealer, or used powersports vehicle dealer. For a wholesale transaction, the bond is available to each party to the transaction; except that, if a retail consumer is involved, the consumer has priority to recover from the bond. The amount of the bond must be fifty thousand dollars for each wholesaler applicant, powersports vehicle dealer applicant, and used powersports vehicle dealer applicant. The aggregate liability of the surety for all transactions does not exceed the amount of the bond, regardless of the number of claims or claimants.
(b) No corporate surety is required to make a payment to any person making a claim under the bond until a final determination of fraud has been made by the board or by a court of competent jurisdiction.
Bonds required pursuant to this section shall be renewed annually when the bondholder's license is renewed. Bonds may be renewed through a continuation certificate issued by the surety.
Nothing in this part 4 shall interfere with the authority of the courts to administer andconduct an interpleader action for claims against a licensee's bond.
Source: L. 2018: Entire article added with relocations, (SB 18-030), ch. 7, p. 108, § 2, effective October 1. L. 2020: (1) and (2) amended, (SB 20-140), ch. 225, p. 1104, § 5, effective September 14.
Editor's note: (1) This section is similar to former § 12-6-512 as it existed prior to 2018.
(2) Section 8 of chapter 225 (SB 20-140), Session Laws of Colorado 2020, provides that the act changing this section applies to offenses committed on or after September 14, 2020.