Should We Have Bail Bond Agents in NSW?

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If you are granted bail in NSW, you or an “acceptable person” who has known you for some time may need to deposit an amount of money before you can be released. The bail money is called “security” and the person who puts up the money is called the “surety”.

Alternatively, you or a surety may be asked to agree to forfeit a sum of money if you breach bail. In that case, you will not need to actual deposit the security.

The idea is that you are far more likely to attend court if a person that you know has deposited money for you – which they may forfeit if you fail to attend.

Bail Bonds in the United States

The situation in the US is very different – there, almost anyone can deposit a security. In fact, there are thousands of “bail bond agents” who will deposit a security on your behalf for a hefty fee.

And whereas being able to deposit a security is not the primary consideration in NSW, the situation in US courts is often that a large security will be set by the court – which may be so high that it is out of reach for many defendants.

This was the predicament that one Baltimore man found himself in, after being charged with disorderly conduct and riot. He was shocked to discover that in order to be released on bail, he would need to pay $250,000, and even if he engaged a bail agent, the 10% fee is still a staggering $25,000. He was forced to spend a month in prison, even though the charges were later dropped. For some, this story highlights everything that is wrong with the monetary-focused US bail system.

While bail bonds are banned in most countries, it thrives in the US. In fact, there are just four states which have prohibited the practice – Illinois, Kentucky, Oregon and Wisconsin.

But in other states, paying other people’s bail is big business.

How Do Bail Bonds Work?

If police in the US charge you with an offence, they can decide either to let you go or keep you in custody until you go before a court. The court can impose a bail security, which you will need to come up with before you are set free.

Bail security is often required to make sure you attend court. But not everyone can afford to post bail, which is where these companies step in to the picture. If you pay them a fee (usually 10% but sometimes as much as 15% of the total amount of the bond) they will take care of the rest.

But watch out! These bail bond agents have the power to apprehend those who do not come to court, and many require you to provide some kind of collateral, such as jewellery, electronics, houses or even, in one case, a winning lottery ticket.

Back to NSW

Despite the history of bond agents dating back to the 1800s, the practice has not been adopted by other countries. In fact, the US and the Philippines are almost exclusively the only two areas of operation for commercial bail bonds.

The NSW Bail Act does not mention the words “bail bond”, but section 86 of the Bail Act 2013 makes it an offence for any person to agree to indemnify another person against any forfeiture of the surety agreement. This prohibits bail bond type relationships. The maximum penalty is three years imprisonment and/or a $3,300 fine.

In addition, section 87 of the Bail Act abolishes the common law right for the bail surety to arrest an accused person as a result of entering into the bond.

Are Commercial Bail Bonds Unfair?

While many in the bail bond industry make a decent living, the practice has been criticised for unfairly exploiting the vulnerable and perpetuating injustice.

By 2004, 40 per cent of defendants charged with serious offences used a commercial bail company to keep their freedom in the lead-up to their court hearing.

This is a real concern, considering that many defendants will either have the charges against them dropped or be found ‘not guilty’ in court.

Innocent defendants who cannot afford to pay the bail bond themselves still have to pay the 10% fee to the agent, whereas a person who is financially able to post the bail themselves – or has family or friends to do so – will receive their full amount back.

It has been argued that prosecution attorneys regularly seek very large sums for bail, often in the hundreds of thousands, so that even the 10% or 15% fee will represent a significant obstacle for defendants.

Although laws differ from state to state, for many US states, bail bonds agents are only allowed to negotiate after being contacted by a lawyer, defendant or indemnitor.

But it has been reported that many are engaging in unethical practices, including paying inmates in return for tip-offs about new arrivals in prison in order to get more business.

On the other hand, supporters of commercial bail bonds say that the system works – and that it helps get innocent people out of prison even if they cannot afford to pay the entire bond themselves.

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About Ugur Nedim

Ugur Nedim is an Accredited Specialist Criminal Lawyer and Principal at Sydney Criminal Lawyers®, Sydney’s Leading Firm of Criminal & Traffic Defence Lawyers.

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