Texas Insurance Commissioner Signs Emergency Cease and Desist Order

March 11, 2005

On March 3, 2005, Texas Insurance Commissioner Jose Montemayor signed an order to stop unlicensed individuals and their affiliates from selling unauthorized surety bonds to Texas consumers.

According to the Texas Department of Insurance, Robert Joe Hanson, along with Daniel Lyon and affiliated companies Global Bonding, Millennium Bonding, and Individual Surety Ltd., must cease and desist from the sale of surety bonds. Neither Hanson nor any of his affiliates are licensed to write surety bonds in Texas.

Hanson and his affiliates issued at least thirteen fraudulent bonds to small, minority-owned businesses and collected at least $675,000 in premium payments. Many of these bonds may not have been backed by the necessary funds in the event of a claim.

TDI said the states of Georgia, Washington, Florida, Montana and Nevada have also ordered Hanson and his affiliated companies to cease and desist issuing fraudulent bonds. Hanson faces criminal charges in California, where he has been charged with selling fraudulent contractor bonds and fake certificates of liability.

“It appears Mr. Hanson has been targeting low-income, minority and women-owned businesses when selling unauthorized surety bonds,” Montemayor said. “Sale of these fraudulent bonds pose a significant threat to Texas businesses and the Texas Department of Insurance will stop it wherever we find it. While the surety bond markets remain tight, TDI is committed to helping small business owners find appropriate financial backing through its online resources and our toll-free consumer information lines.”

Texas consumers are encouraged to check the licensure status of insurance agents and agencies on the TDI website (www.tdi.state.tx.us) or call the TDI Consumer Help Line at (800) 252-3439 for assistance.

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