Posted May 6, 2013 at 12:00 AM by Michael J. Whitlock, Executive Vice President
In the bail bond business paying a loss as a result of an inability to recovery a fugitive is a sign of failure. Paying bond forfeiture losses can be attributed to underwriting, a lack of experience, initiative and simply bad luck. A loss can be damaging financially and could even put a bail agent out of business. Even with a loss there can be a silver lining.
How many of us working in the bail industry have been told by legislatures, law enforcement and adversaries that bail agents don’t have to pick up defendants who fail to appear because law enforcement does this for them? This may be the single most misrepresentation perpetrated on our industry.
I have underwritten thousands of bonds over the years and several of those bonds have forfeited when the defendant failed to appear. Most were resolved in short order and then there were those that seemed impossible to locate and proved impossible to resolve resulting in a loss. Unfortunately, law enforcement did not come to our rescue in those situations.
A couple years ago, a bill was introduced in the Colorado legislature that would have expanded the use of taxpayer funded pretrial services and introduce a deposit bond option. If this bill had passed it would have put a significant number of bail agents out of business. In order to derail this legislation, the coalition of bail agents and sureties had to come up with a way of showing a significant negative fiscal impact on the State of Colorado should the bill pass into law.
We know, and it has been demonstrated time again, the commercial bail industry operates at no cost to the taxpayers. What is not often mentioned is the revenue generated in favor of counties and states from the writing of bail. Revenue comes in the form of licensing fees, losses and premium taxes.
All surety companies and bail agents operating in Colorado were asked to submit figures for losses, licensing fees and premium taxes paid in the previous two years. These figures were submitted to a central source where they were compiled and presented to the legislative committee at the appropriate time. It was determined millions of dollars are paid annually in the form of losses, fees and premium taxes. To reduce or eliminate private sector bail agents would have a negative fiscal impact on the State of Colorado. That bill did pass.
On many occasions since that time in Colorado, surety companies and bail agents have produced their loss numbers to demonstrate to a legislative body the positive fiscal impact commercial bail has on a state’s revenue. Even though bail agents resolve 99% of their forfeitures, an obvious win for public safety and victims of crime, the state still wins by receiving revenue from losses paid in those rare occasions when a bail agent is unable to perform. Even when a bail agent looses, the state wins, something taxpayer funded pretrial services cannot proclaim.
The next time you are asked by your surety or state association to provide your paid loss information, know that agonizing loss could have an upside and contribute to saving your profession.
Posted April 28, 2013 at 12:00 AM by Michael J. Whitlock, Executive Vice President
In the wake of a recent failed effort to repeal Indiana's no-credit law, the ISBAA will hold a debate on the issue during its annual membership meeting. ISBAA had taken a position in opposition to the repeal of no-credit. The meeting will be held at the Blue Chip Casino in Michigan City, Indiana, Saturday, May 18.
I have agreed to participate in the debate arguing in favor of repealing Indiana's no-credit law as a means of competing with the ten percent cash bond option favored by the majority of Indiana counties. Some of the reasoning behind this position can be found in my recent blog, Effort to Repeal No-Credit Fails.
All Indiana bail agents are urged to attend the meeting in Michigan City. In addition to discussing whether or not to repeal the no-credit law, the Indiana Legislature's Study Committee on Bail convening this summer will also be discussed at length.
The commercial bail market in Indiana is being adversely impacted by the expanded use of deposit bail. Because bail bonds are documented to be the most effective guarantee of appearance by criminal offenders, when the use of bail bonds decline, failures to appear and crime increase.
If you're a bail agent in Indiana interested in the survival of your profession then there is no excuse not to attend this important meeting. I look forward to seeing you there.
Posted April 19, 2013 at 12:00 AM by Michael J. Whitlock, Executive Vice President
Young Harris, GA - In North Georgia, just a few miles south of the North Carolina line sits the Brasstown Valley Resort and Spa, site of the 2013 Spring Meeting of the Georgia Association of Professional Bondsmen, Inc. The spring meeting is typically held on St. Simon's Island or in Savannah. New GAPB President Scott Echols wanted to mix it up a bit and opted for the mountains of North Georgia for the first meeting of 2013.
I had accepted an invitation to speak on legislative matters impacting other states around the country. Though I was able to cover a lot of ground, an hour was not enough time to get to every issue. Being aware of trends affecting bail in other states can help state associations plan their legislative strategies to protect or improve their state’s bail market.
Those in attendance really wanted to learn more about favorable legislation that recently passed in their own state of Georgia. Senate Bill 225, which provides latitude to the surety to obtain exoneration of the bond when a defendant was found to be in custody in another jurisdiction, was sent to the governor April 6 for signature. The measure also provides for a remission period of 120 days after payment of the bond forfeiture judgment, to return the defendant to custody and receive a refund equal to 95 percent of the bond, less cost for extradition, if necessary. Click here to view SB 225.
Prior GAPB administrations had set the bar high with a rich history of GAPB achieving its legislative goals. In recent years the Georgia association was successful in increasing the gross bond premium to 12-15 percent, requiring a bail bond whenever an ankle monitor is set as a condition of release, requiring a defendant charged with certain felony offenses to post a bail bond and establishing a time certain to send notice of forfeiture to the surety.
GAPB President Scott Echols and his newly elected Board of Directors had their work cut out for them coming into their first legislative session. The GAPB legislative team worked tirelessly at the statehouse and brought in additional resources to help press their agenda. The end result was an impressive piece of legislation which, upon signing by Governor Nathan Deal, will create the incentive for bail agents to continue looking for fugitives even after a judgment has been paid and, in return, create the potential for Georgia bail agents to save thousands of dollars in losses every year.
I continue to be impressed with this association. Other state associations could learn from GAPB and their record of success.
Posted March 29, 2013 at 12:00 AM by Michael J. Whitlock, Executive Vice President under Deposit Bail, and Legislation
Indianapolis, IN - An effort to repeal Indiana’s no-credit law on bail premiums failed yesterday. Amendment HB1006 #30 was offered by Senator Steele during the Senate Judiciary Committee. Senator Steele is a longtime supporter of commercial bail and public safety issues. The president of the Indiana Surety Agents Association testified in opposition to the amendment, specifically that portion dealing with the repeal of no-credit on bond premium. As a result, the amendment failed to pass.
The proposed amendment did two things. Number one, it repealed the no-credit law allowing bail agents to accept payment terms on the premium. Current Indiana law requires bail agents to collect the entire premium prior to posting a bond. Number two; it is the defendant’s choice to post a full cash bond or a bail bond. Current law could be interpreted to say a judge can set a ten percent cash deposit bond to the exclusion of all other options.
This legislative effort was initiated by American Surety Company and we are very proud of this fact. American Surety Company is the only bail surety company domiciled in Indiana regulated by the Indiana Department of Insurance. Indiana is our home court. We feel obliged to act in the best interest of all bail agents in this state. After years of watching other initiatives fail, we believed it was time to slaughter the sacred cow, that being no-credit.
We sought support from other surety companies doing business in Indiana. The majority supported. We invited our agents to our office to discuss our proposals. The majority supported. We believe the American Surety agents we spoke with were a fair sampling of all Indiana agents. We calculated most bail agents in this state would recognize the need for repealing this antiquated law and the value of a law that would allow a defendant to opt for the type of bond they wish to post.
Indiana is the last remaining state to not allow payment terms. Some Indiana bail agents wear no-credit as a badge of honor. In actuality, no-credit is more like a pair of handcuffs that prevent bail agents from competing against deposit bail.
Of the 92 counties in Indiana, at least 37 have rooted out bail agents with deposit bail. The rest of the counties in the state offer a deposit bond option and some percentage of surety bail. Bail agents are at a major disadvantage because they cannot compete with the ten percent cash option, not if they must collect the full bond premium prior to posting a bond.
Criminal defendants seeking release from jail will continue to select the path of least resistance, deposit bail. Why would a defendant pay a bond premium and put himself at the mercy of a bail agent and release conditions when they could simply deposit the same ten percent to the court with no conditions?
If a bail agent was able to provide a defendant with payment terms, a number of defendants would start opting for a bail bond. Why, because it would be the easier path. Defendants and their family do not always have the money to cover the full ten percent without options they sit in jail. A lot of people need payment terms, a simple fact.
We firmly believe a bail agent having the legal authority to offer payment terms to their clients and the defendant having the option to post a bail bond is the only way to compete with the ten percent option and reclaim market share in those counties where ten percent is an option and those counties where it’s the only option.
The inability to pass Amendment # 30 was a critical opportunity lost. Bail agents would finally have something to look forward to rather than count down the days to their industry’s demise. American Surety Company will continue to use knowledge and common sense in our fight on behalf of bail agents and the preservation of the bail industry. If you are a member of the ISBAA I urge you to make your position known to them on the concept of repealing the no-credit law.
Posted March 4, 2013 at 12:00 AM by Michael J. Whitlock
Executive Vice President
American Surety Company under Meeting Recaps
Las Vegas, NV - The Professional Bail Agents of the United States recently held its 2013 Winter Conference in Las Vegas. I was in attendance and found The Mirage Hotel & Casino a welcoming venue for this year’s event. American Idol was taping its show in the hotel’s Beatles’ Love Theater, which provided an added boost of excitement to the week.
It was apparent at the 2012 Mid-Year meeting in San Diego, PBUS was moving to a healthier place financially. PBUS had shed itself of the top-heavy expenses that dogged them for too many years. At the meeting last week, the Board of Directors reported the bail industry’s national association was flush with cash and in a very good place financially.
Current PBUS President Scott Hall of Georgia introduced Corrine Markey as the new Executive Director for PBUS. Corrine has excellent credentials and did a superb job producing her first national bail conference. No easy feat.
The conference offered something for everyone; Certified Bail Agent classes, the For Women’s Only Luncheon which featured Apollonia Kotero and the Council of President’s meeting which brought us up to date on legislative issues from around the country.
There was also a very informative lecture during the general meeting on the effective use of the Internet to track fugitives. I found the facial recognition information to be particularly fascinating. While the lecture did include explicit material inappropriate for any audience, I did not let this detract from the tremendous amount of new information gleaned from this speaker.
The awards this year went to Jeff Kirkpatrick, PBUS President’s Award; Melanie Ledgerwood, Individual of the Year and Pam Jackson, Bail Agent of the Year. The lone inductee into the PBUS Hall of Fame was a remarkable gentlemen and veteran of WWII, Leo Dumouchelle. Mr. Dumouchelle was awarded two Purple Hearts and numerous other medals during the time he was in service to our country. At 90 years of age, he’s in good health and still writing bail in San Luis Obispo, California.
The PBUS 2013 Summer Conference will be held at the Royal Sonesta Hotel in New Orleans in July.