In an effort to increase their market share, some bail bond companies have loosened or done away with requirements for collateral when posting bail for criminal defendants, according to a review of records by the Los Angeles Times. The practice attracts more customers but provides less incentive for defendants to return to court and often leaves counties short millions of dollars in bail forfeitures, the paper reported Sunday.
The California Department of Insurance, Los Angeles County District Attorney Steve Cooley and others statewide are investigating alleged corruption that could lead to charges of perjury, conspiracy, obstruction of justice and unlawful business practices.
State officials have no comprehensive records of bail forfeitures. But Los Angeles County hasn't been able to collect at least $9.1 million in bail forfeitures in a two-year period ending in August 2003, according to the paper.
Of that amount, $5.9 million was attributed to bail bonds associated with Capital Bonding Corp., a Pennsylvania-based company.
Capital's president, Vincent Smith, recently stepped down at the insistence of the firm's bail bond insurer. Harco National Insurance Co. of Illinois took over Capital's operations last month after realizing that it could be liable for millions of dollars in delinquent bail in California and other states, Harco's attorneys said.
Jeff Stanley of San Jose-based Bad Boys Bail Bonds, the state's second-largest bail bond company, said his company and others have been unfairly targeted by officials because of the complaints of smaller firms that have lost market share.
Cooley filed perjury and forgery charges July 9 against one of Bad Boys' employees, Cindy Abreu, accusing the paralegal of filing false affidavits in court to delay payment of forfeitures. Abreu pleaded not guilty July 16 and declined to comment. She faces up to 11 years in prison if convicted.
Bail bondsmen in California traditionally have required defendants to pledge collateral, such as a home, to secure the full bail -- but that's not required under state law. The firms under investigation often skip it and sometimes discount the cash commission the defendant must pay, Cooley said.
Cooley estimates that uncollected bail forfeitures have cost Los Angeles County $30 million over the last three years. Statewide, unpaid forfeitures may total $100 million to $150 million over the same period, said Steve Krimel, a bail expert and attorney who represents a small bail firm that is losing out to high-volume competitors.
