Virginia Code 55.1-1827: Deposit of funds; fidelity bond
A. All funds deposited with a managing agent shall be handled in a fiduciary capacity and shall be kept in a fiduciary trust account in a federally insured financial institution separate from other assets of the managing agent. The funds shall be the property of the association and shall be segregated for each account in the managing agent’s records in a manner that permits the funds to be identified on an individual association basis.
Terms Used In Virginia Code 55.1-1827
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Association: means the property owners' association. See Virginia Code 55.1-1800
- Board of directors: means the executive body of a property owners' association or a committee that is exercising the power of the executive body by resolution or bylaw. See Virginia Code 55.1-1800
- Fiduciary: A trustee, executor, or administrator.
- Trust account: A general term that covers all types of accounts in a trust department, such as estates, guardianships, and agencies. Source: OCC
B. Any association collecting assessments for common expenses shall obtain and maintain a blanket fidelity bond or employee dishonesty insurance policy insuring the association against losses resulting from theft or dishonesty committed by the officers, directors, or persons employed by the association or committed by any managing agent or employees of the managing agent. Such bond or insurance policy shall provide coverage in an amount equal to the lesser of $1 million or the amount of the reserve balances of the association plus one-fourth of the aggregate annual assessment income of such association. The minimum coverage amount shall be $10,000. The board of directors or managing agent may obtain such bond or insurance on behalf of the association.
2007, cc. 696, 712, § 55-514.2; 2008, cc. 851, 871; 2019, c. 712.