1. Forms
  2. FC
  3. BMC-85

What it does

Form BMC-85 is the broker trust fund agreement filed with FMCSA "for the full security limits" of $75,000 under 49 CFR 387.307 as an alternative to the BMC-84 surety bond. Acceptable trust fund assets are limited to cash, irrevocable letters of credit issued by a federally insured depository institution, and Treasury bonds, and they must be capable of liquidation to cash within 7 calendar days.

Key rules

  • The trust fund agreement may be cancelled only on 30 days' written notice to FMCSA on Form BMC-85 by the broker or trustee.
  • As with bonds, the financial institution must notify FMCSA if claim payments reduce the fund below $75,000, triggering suspension procedures, and must accept claims for 60 days after notice of a broker's financial failure.

Who uses it

Brokers and forwarders that prefer to post collateral instead of buying a surety bond.

Selling notes

A trust fund ties up $75,000 of the broker's assets. Compare the cost of a BMC-84 bond premium and the broker's other insurance needs (contingent auto, contingent cargo, E&O).