Newport News Precious Metal Dealer Bond: A Comprehensive Guide
At a Glance:
- Average Cost: $100 per year
- Bond Amount: $10,000
- Who Needs it: All precious metal dealers operating in Newport News, Virginia
- Purpose: To protect the public from financial harm if the precious metal dealer violates the terms of their permit
- Who Regulates Precious Metal Dealers in Newport News: The Newport News Police Department
Background
Virginia Code 54.1-4108 requires all precious metal dealers operating in the state to obtain a permit from their city or county’s local law enforcement agency. The Virginia legislature enacted the permitting requirement to ensure that precious metal dealers engage in ethical business practices. To provide financial security for the enforcement of the permitting law, precious metal dealers must purchase and maintain a $10,000 surety bond to be eligible for a permit.
What is the Purpose of the Newport News Precious Metal Dealer Bond?
Newport News requires precious metal dealers to purchase a surety bond as part of the application process to obtain a permit. The bond protects the public from financial harm if the dealer fails to comply with the regulations set forth in Newport News Code of Ordinances 30-38. Specifically, the bond protects the public if the dealer engages in any acts of fraud or breaches consumer contracts. In short, the bond is a type of insurance that protects the public if the precious metal dealer violates the terms of their permit.
How Can an Insurance Agent Obtain a Newport News Precious Metal Dealer Surety Bond?
BondExchange makes obtaining a Newport News Precious Metal Dealer bond easy. Simply log in to your account and use our keyword search to find the “Precious Metal Dealer” bond in our database. Don’t have a login? Gain Access now and let us help you satisfy your customers’ needs. Our friendly underwriting staff is available by phone at (800) 438-1162, email, or chat from 7:30 AM to 7:00 PM EST to assist you.
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Is a Credit Check Required for the Newport News Precious Metal Dealer Bond?
No, a credit check is not required for the Newport News Precious Metal Dealer bond. Because the bond is considered relatively low risk, the same low rate is offered to all precious metal dealers operating in the city, regardless of their credit history.
How Much Does the Newport News Precious Metal Dealer Bond Cost?
The Newport News Precious Metal Dealer bond costs just $100 per year or $10 per month.
Who is Required to Purchase the Bond?
Newport News requires all precious metal dealers to purchase a surety bond as a prerequisite to obtaining a permit. To paraphrase Newport News Code of Ordinances 30-31, a precious metal dealer is a person who purchases and sells secondhand items containing precious metals such as gold, silver, jewelry, and other items containing precious metals or gems from the general public.
Exemptions to this definition include:
- Purchases of precious metals directly from manufacturers
- Qualified fiduciaries distributing an estate’s assets
- Banks, trust companies, or bank holding companies
- Antique or gem exhibitions sponsored by nonprofit organizations
- Repairing, restoring, or designing jewelry
- Purchases of nonprecious scrap metals
- Purchases or sales of coins
Virginia Code 54.1-4106 allows dealers to obtain an irrevocable letter of credit in lieu of a surety bond. Surety bonds are generally considered the better option for businesses as they free up working capital. For more information on whether your customer should purchase a bond or deposit cash, check out our Surety Bonds vs. Letters of Credit article here.
BondExhange now offers monthly pay-as-you-go subscriptions for surety bonds. Your customers are able to purchase their bonds on a monthly basis and cancel them anytime. Learn more here.
How Do Precious Metal Dealers Apply for a Permit in Newport News?
Precious metal dealers in Newport News must navigate several steps to obtain a permit and must obtain a separate permit for each business location they operate. Below are the general guidelines, but applicants should refer to the regulatory ordinances for details on the process.
Permit Term – All Newport News Precious Metal Dealer Permits expire one year from the date of issuance and must be renewed before the expiration date.
Step 1 – Contact the Police Department
To obtain a permit application, dealers must contact the Newport News Police Department by email or by phone at (757) 928-4300. The department will walk them through the application process, provide them with all required forms, and answer any questions they may have. Dealers are required to be fingerprinted by the department, complete a background check, and have their weights and measurements inspected. Applicants convicted of a felony or crime of moral turpitude within the past seven years are not eligible for a permit, and all applicants must pay a $200 permit fee.
Step 2 – Purchase a Surety Bond
Precious metal dealers must purchase and maintain a $10,000 surety bond.
How Do Newport News Precious Metal Dealers Renew Their Permit?
Precious metal dealers should contact the Newport News Police Department to renew their permit before their existing one expires. Dealers must pay a $200 renewal fee and ensure they renew their surety bond to avoid termination of their permit. All Newport News Precious Metal Dealer Permits expire one year from the date of issuance and must be renewed before the expiration date.
What are the Insurance Requirements for Precious Metal Dealers in Newport News?
Newport News does not require precious metal dealers to purchase any additional insurance. Dealers must purchase and maintain a $10,000 surety bond.
How Do Precious Metal Dealers File Their Bonds?
Precious metal dealers should mail or deliver their completed bond forms, including the power of attorney, to the Newport News Police Department at the following address:
9710 Jefferson Avenue
Newport News, VA 23605
The bond requires signatures from both the surety company that issues the bond and the applicant. The surety company should include the following information on the bond form:
- Legal name of the entity/individual(s) buying the bond
- Surety company’s name and state of incorporation
- Bond amount
- Notary acknowledgments
What Can Newport News Precious Metal Dealers do to Avoid Claims Made Against Their Bonds?
To avoid claims against their bonds, precious metal dealers in Newport News must ensure that they:
- Do not engage in any acts of fraud
- Faithfully honor all consumer contracts
- Do not purchase or sell any stolen goods
- Maintain all required transaction records
- Obtain identification before each transaction
What Other Insurance Products Can Agents Offer Precious Metal Dealers in Newport News?
Newport News does not require precious metal dealers to purchase liability insurance. However, most reputable businesses will purchase this insurance anyway. Bonds are our only business at BondExchange, so we do not issue liability insurance, but our agents often utilize brokers for this specific line of business. Agents can access a list of brokers online here.
How Can Insurance Agents Prospect for Newport News Precious Metal Dealer Customers?
Newport News unfortunately does not provide a public database of active precious metal dealers in the city. However, we suggest contacting the Newport News Police Department to obtain this information. Contact BondExchange for additional marketing resources. Agents can also leverage our print-mail relationships for discounted mailing services.