Telephonic Seller Bond Requirements
At least ten (10) days before the commencement of any promotion offering any gift or prize with an actual or represented market value of five hundred dollars ($500.00) or more, the telephonic seller is to notify the Secretary of State’s Office in writing the details of the promotion. The details include:
- A full description, nature and number of all gifts or prizes and their current market value
- The seller’s rules and regulations governing the promotion
- The date the gifts or prizes are to be awarded (All gifts and prizes shall be awarded)
A bond is to be posted with the Secretary of State’s Office with notification of the promotion.
- Amount of the bond is to be the market value or the represented value, whichever is greater, of all gifts or prizes represented as available under the promotion.
- Bond must be issued by a surety company authorized to do business in North Carolina.
- Bond is to be in favor of the State of North Carolina and will benefit any person entitled to receive a gift or prize under the promotion who did not receive it within thirty (30) days of the specified date of award.
Within forty-five (45) days after the specified date of the award of the gift or prize, the seller needs to notify the Secretary of State, in writing, proof that the gifts or prizes have been awarded. The writing shall include:
- Name, address and telephone number of all persons receiving awards or prizes
The bond shall be maintained until the Secretary receives reliable proof that the gifts or prizes have been delivered to the intended recipients.
The Attorney General, on behalf of any injured purchaser, or any purchaser who is injured by the bankruptcy of the telephonic seller or its breach of any agreement entered into in its capacity as a telephonic seller, may initiate a civil action to recover against the bond.