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Friday, February 23, 2007

Committee Hearing on SB153

Senate Bill 153 will be heard by the Senate Small Business, Insurance and Industrial Relations Committee next Tuesday, February 27th, at noon. This is the DIFP bill which has 7 pages of bail bond language included in the bill. Here’s a link to the whole bill as well as link to just the bail section.

To refresh your memory, here is what is presently included in the bill:

1) Doubles Your CD-Increases the general agent's assigned CD from $10,000 to $20,000 and allows by regulation, the Department to increase the CD to $100,000.
2) Dollar for Dollar-Includes a provision which by-passes filing with the local courts and establishes a system to report to the Office of State Courts Administrator. The language states that each general agent (but not insurance companies) file an affidavit saying that his/her total net assets exceed the aggregate (total) amount of bonds written. This provision creates a “dollar for dollar” system and assumes that 100% of your bonds will result in judgment. Insurance companies are exempt from this provision and only have to prove “solvency” to the local court. Additionally, a fee is associated with this process and that fee has not been disclosed in the bill.
3) Former General Agents Given Power to Revoke Your License-If you leave a company, your former general agent can revoke your authority for any outstanding premium. The bill does not distinguish whether this is collected premium owed the company or uncollected, (or worse, uncollectible) credit that you have extended to clients. This provision was borrowed from the Florida statutes, with two important differences. First, the Florida statute includes a due-process provision which stays the cancellation of authority until the Department investigates the allegations of the former general agent. Without this provision, a former general agent can deprive an agent of the right to earn a living without due process of law.
4) EVERY Forfeiture Must Be Noticed by Department-Upon notice by the court, the Department must notify general agents of a bail bond forfeiture within 48 hours. Courts already report unsatisfied judgments. Since most forfeitures are set aside and do not result in judgment, it seems quite onerous for the Department and the courts to notify for every forfeiture in the state.
5) Felon Language-Allows the 15 year felony clause, but adds that a license MAY be refused, revoked, etc. if an applicant has been convicted of: any dangerous felony defined by section 556.061, RSMo, any felony crime of assault, any felony crime that results in the serious physical injury or death of another person, any felony crime against the administration of justice, or any felony of which deceit or fraud is an element of the offense. Felonies not included in this language would be manufacturing of meth, possession of child pornography, and distribution of drugs.

Here are the committee members who will hear the bill:

John Loudon, 7th, Chair , Part of St. Louis County
Luann Ridgeway, 17th, Vice-Chair, Clay County
Dan Clemens, 20th, Counties of Christian, Douglas, Webster and part of Greene
Scott Rupp, 2nd, Lincoln County and part of St. Charles County
Delbert Scott, 28th, Barton, Benton, Cedar, Dallas, Henry, Hickory, Pettis, Polk, St. Clair
Carl Vogel, 6th, Callaway, Cole, Miller, Moniteau and Morgan
Victor Callahan, 11th, Part of Jackson
Rita Days, 14th, Part of St. Louis County
Tim Green, 13th, Part of St. Louis County

How you can be heard on this bill:

Contact your senator by letter, personal visit, or phone call, especially if your senator is on this committee. Need help locating your senator? Go to
find my Senator. You can attend the hearing next Tuesday and tell the committee how you feel about this bill. If you think this language would be detrimental to your business, tell your Senator to strip this language from the bill.

Wednesday, February 21, 2007

Good Felony, Bad Felony

Are we returning back in time to the days of licensing bail bond agents by using the “good felony, bad felony yardstick?” It seems that may be the case. In a ruling issued by the Department of Insurance (DIFP), Gerald Franks, who pleaded guilty to a Class C felony one year ago, has retained his general bail bond license. In an order dated February 1, 2007, the DIFP suspended the Frank's license for three days. Franks entered a plea of guilty in February 2006 for possession of a controlled substance in Daviess County, MO. He was placed on five years supervised probation. In May, the DIFP filed a complaint to discipline Frank’s license. On December 4th a joint motion was filed before the AHC stipulating the DIFP’s grounds for disciplining Frank’s license. The AHC ruled there was cause to discipline Frank’s license. Later, the DIFP held a disciplinary hearing which resulted in an order suspending Frank’s license for 3 days.

This seems to be a drastic shift in policy by the DIFP. Previously, the Department appeared decisive in its stance against felons in the bail bond business. The DIFP issued several strongly-worded news releases regarding the issue. In November 2005 former director Dale Finke said in
a news release, “The Missouri Supreme Court rules make it clear that convicted felons are not qualified for surety on bail bonds.” One month later, in another release, the Director said, “Individuals working in this capacity should, and must, uphold the law themselves.”

Previously, the DIFP had said that according to RSMO 374.715, Missouri bail bond agents and general agents could not be felons because they must meet the qualifications for bondsmen as required by Missouri Supreme Court rule. Supreme Court Rule 33.17(c) says: A person shall not be accepted as a surety on any bail bond unless the person has not, within the past 15 years, been found guilty of or pleaded guilty or nolo contendere to any felony of this state or the United States; or any other crime of this state or the United States involving moral turpitude, whether or not a sentence was imposed.

Sunday, February 18, 2007

Stun Gun Bill Heard in Committee

A hearing was held last week in the Senate Judiciary Committee on the stun gun bill. The bill is SB61 sponsored by Senator Yvonne Wilson. The bill requires a permit to purchase a stun gun or taser. The permit is the same permit required to purchase a concealable firearm. The permit would be obtained by application to the sheriff in your county of residency. The qualifications of the permit are:

1)At least 21 years old and resident of the state for 6 months.
2) Has not pled guilty to or been convicted of a felony of any state or of the United States other than a crime classified as a misdemeanor under the laws of any state and punishable by a term of imprisonment of two years or less that does not involve an explosive weapon, firearm, firearm silencer, stun gun or taser, or gas gun;
3) Is not a fugitive or charged with any felony or misdemeanor involving an explosive weapon, firearm, firearm silencer, stun gun or taser, or gas gun.
4) Has not been dishonorably discharged from the armed services.
5) Is not known to be habitually intoxicated or in a drugged condition.
6) Has not been adjudged mentally incompetent or been committed to a mental health facility.

Another Trial Setting for Jackson/Dotson

Bondsmen Virgil Lee Jackson and Glen Dotson have been issued new trial dates. Jackson's trial has been set for March 19th and Dotson's has been set for March 26th. This is the fourth trial setting for these cases.

During the last continuance, Dotson's attorney wrote in a motion that they have been informed that the US government may seek a second or superseding indictment concerning a potential RICO violation. If this were to occur, the waiver states, Dotson and/or Jackson could be facing additional charges causing an additional trial.

Previous Coverage below.
Lee Jackson held on federal charges 4/1/2006
Dotson Arrested/New Charges for Jackson 6/2/2006
Dotson/Jackson trial postponed 6/8/2006
Arraignment 6/13/2006
Trial postponed again 10/28/2006
Dotson Freed on Bond 11/15/2006
Jackson Accused of Another Murder Plot 11/22/2006
January Trial Date Postponed 1/22/2007

Wednesday, February 14, 2007

Zero-Tolerance for Tardiness

Attention all continuing education students taking classes for bail bond license renewal

The State of Missouri, Department of Insurance (DIFP) has instituted a zero-tolerance policy in regard to tardiness. In a memo dated February 8th, the DIFP directed all continuing education providers to flunk all students who were tardy after lunch or breaks. The memo states: “It does not matter how late the student may be, whether it is 5 minutes or an hour, a Certificate of Course Completion cannot be given to that person. You should immediately make the person aware that they will not receive credit if they choose to stay for the remainder of the class.” In other words, there is no such thing as an excused tardy. If you are five minutes late to class, credit will not be awarded. You may not stay late and write on the chalk-board to make up your time. The memo further warns instructors that failure to comply with these policy guidelines will result in revocation of provider approval in Missouri.

I think the Missouri General Assembly should adopt a zero-tolerance for tardiness in the chambers. (Those warning chimes in the halls of the Capitol are not just there to make your ears ring.) And while we are at it, sounds like a good policy for the workplace, too. Maybe Governor Blunt should follow the DIFP’s lead; it could save the State lots of money if every employee who returned late from lunch or break would not receive credit if they chose to stay the remainder of the day.

Here are some tips to help you successfully complete your state required training. (Remember, if you are late you will fail the class and forfeit your $150 fee.)
1) First and foremost, synchronize your watches. You don’t want to fail a class because your instructor’s watch runs fast.
2) Limit fluid intake. Long lines at the bathroom during the 10-minute break could cost you the class.
3) If you MUST go to the bathroom, dart to the bathroom as soon as the instructor releases you. You don’t want to be in line behind someone who ate a greasy burger for lunch.
4) DO NOT eat lunch at a sit-down restaurant. You have no control over how soon your food will be served. Eat fast-food. Of course this may cause problems with number 3. You could also fast for the day, along with limiting fluid intake.
5) Weigh all emergency phone calls against the cost and time in the class. (If they are already dead, it can certainly wait.)

Tuesday, February 13, 2007

AHC Denies License to Convicted Felon

The Administrative Hearing Commission (AHC) has issued a ruling on the two-year-old case involving the licensing of James Gillihan. In Novemer 2004, the Department of Insurance (DIFP) denied Gillihan’s bail bond agent license application because he is a convicted felon and for using fraud or misrepresentation in applying for his license. Gillihan appealed the DIFP’s decision. According to the AHC record, Gillihan was a licensed bail bond agent from March 1989 to March 1997 and again from November 1999 to November 2000. He also held a general bail bond license from April 1996 to April 2000.

According to the record, Gillihan pleaded guilty in US District Court in October 1999 to aiding and abetting the use of a firearm during a crime of violence. He was sentenced to five years in prison and fined 1.2 million dollars. The AHC record also reflects that during the plea hearing, Gillihan testified that he took diamonds from a client that he knew were obtained through jewelry store robberies.

When Gillihan applied for his license in 2004, he claimed that he did not know the diamonds were stolen, contrary to his previous testimony. The AHC reports that Gillihan argued that his license should be granted because the DIFP had granted licenses to other felons and that his felony was not violent.

The AHC denied Gillihan’s license stating, “In exercising our discretion as to whether to grant or deny the application, we look to statutes on similar subject matter for guidance. We consider the nature of the crime, its relation to the license, how long ago Gillihan committed it, his conduct since that date, and other evidence. We also bear in mind that a license represents the State's seal of approval that an applicant is fit to practice a licensed profession and that applicants who have erred in the past should acknowledge guilt and embrace a new moral code.” The AHC also said in its ruling ….. supporting his clients’ criminal enterprises by purchasing their spoils weighs heavily against fitness for a bail bond license. (Emphasis added)

Note: The AHC made its ruling under the law that existed in 2004, before the new bail bond laws went into effect.

Friday, February 9, 2007

Newest Bail Bill: No Felons...For Now

Has the bail bond association turned over a new leaf? I was really surprised to read the latest version of the bail bond association’s proposed legislation in SB459, introduced Wednesday by Senator Shoemyer-D. Although it looked very similar the association’s language in the two insurance bills, (SB153 and HB586) I immediately noticed a change. The association’s new bill repeals the VERY controversial 15-year Lee Clause allowing felons to obtain a bail bond license. The association passed the Lee Clause in a 2004 bill sponsored by Representative Bob Behnen-R, Kirksville. (Back in 2004, the association was led by Jack Allison, Lee Jackson and a few others. Jackson wanted the law amended so that he could get a general bail bond license despite his felony convictions. Behnen’s bill created the 15-year felony clause which allowed Jackson and others with felony convictions to get licensed. It was dubbed the Lee Clause in honor of Jackson’s accomplishment. After the bill became law, Jackson was indicted in federal court on new felony charges for conspiring to murder a competitor and being a felon in possession of a firearm.)

The bail bond bill, (
SB459) is sponsored by Allison’s senator, Wes Shoemyer of Clarence. Senator Shoemyer, who took office last month, ran a very aggressive campaign against former state representative Bob Behnen last fall. His campaign televised ads criticizing Behnen for working with felons in the bail bond industry and passing legislation to allow them to write bonds. Shoemyer’s introduced bill repeals the Lee Clause, at least for now. I am told that association lobbyist Steve Carroll opposed the repeal of the Lee Clause, although Shoemyer said he could not include the language because he had just run a campaign criticizing Behnen for the felon provision.

Shoemyer doesn’t support legislation allowing felons in the bail bond business, but he is sponsoring legislation promoted by an association president who hires felons. Allison, who has been president of the association since 2003, lobbies for the association at the Capitol. Until his federal indictment and incarceration, convicted felon
Lee Jackson worked for Allison. Donald Christian, convicted of drug charges and facing new drug charges, also works for Allison. Greg Tetro, another Allison agent, is currently under federal indictment on drug charges. Last summer, the Joplin Globe ran a series of articles concerning Jerry Mitzner, a convicted felon in the bail bond business. Mitzner works for Allison. The Globe reported that Allison claimed that the state is wrong about felons being bond agents. He said he knows several who had felony convictions in their backgrounds, that they had paid for their mistakes, and that it was all perfectly legal.

Allison has shown through his statements to the press, his past legislation, and the people working for his bail bond company that he has supported felons in the industry. So, we shall see if he and the association have turned over a new leaf or if they are using Shoemyer and intend to restore the felony language as the bill works its way through the legislature. Watch this bill and see where they stand…..

Thursday, February 8, 2007

Another Bondsman Faces Federal Charges

Another Missouri bondsman is facing federal charges. I recently learned that Gregory K. Tetro of Columbia, Mo. is facing two federal charges for conspiracy to possess marijuana and using a communications device to distribute marijuana. A change of plea hearing is scheduled for March 28th in the US District Court, Jefferson City.

Tetro currently works under the authority of bail association president Jack Allison of Mexico, MO. Tetro joins the ranks of two other licensed agents facing federal charges. Virgil Lee Jackson (who also worked for Allison at the time of his arrest) was arrested in October 2005 for attempting to murder competitor Jerry Cox and being a convicted felon in possession of a firearm. Bail bond agent Glen Dotson, who works for George Dodge of Columbia, was later arrested for allegedly furnishing the gun to Jackson. Both are awaiting trial on those charges.

Another one of Allison's agents, Donald Christian, was charged with attempting to possess a controlled substance in Lincoln County last November. Christian was previously convicted of drug charges in 1998. He obtained his bail bond license in March 2005, after the 15-year felony clause took effect. It is not known how he managed to get his bail bond license considering the recent felony conviction. After his November arrest, the Deparment of Insurance filed a disciplinary complaint against Christian. That hearing is scheduled for April 2, 2007.

No pending disciplinary charges have been filed by the Department of Insurance at this time against Tetro or Dotson. There are disciplinary charges pending against Jackson.

Monday, February 5, 2007

Bonding Company Files Suit Against Judge & Prosecutors

L&C Investments, Inc., and its president, Doug Cheatham, have filed a federal lawsuit against a presiding judge and Buchanan County officials. Named as defendants in the suit are the Honorable Patrick Robb, the Presiding Judge of the Fifth Circuit Court for the State of Missouri, Dwight Scroggins, Jr., the Prosecuting Attorney for the Buchanan County, Dawn Marie Williams, a former assistant Buchanan County prosecuting attorney, Matthew Liles, the current assistant Buchanan County prosecuting attorney, and criminal defendant Mark A. Wilson.

The lawsuit arises from a bond written by L&C for Mark Wilson. Wilson entered a plea of guilty in Buchanan County and was granted a stay of execution on his sentence to Missouri Department of Corrections. Wilson failed to surrender himself to the sheriff to begin his sentencing. A bond judgment was ordered and L&C was ordered to pay the $100,000 bond. L&C appealed the decision and lost.

The complaint alleges conspiracy, 14th amendment claims, and modification of contract. In the conspiracy charge, L&C alleges the defendants used knowledge of a pending federal indictment to “vex” Wilson into entering a plea of guilty to maintain jurisdiction in Buchanan County causing the bail bond forfeiture. In count II of the complaint L&C alleges that defendants failed to notify the bondsman of the modification of the pre-trial bond, failed to act on established procedures and rules regarding the modification of bond conditions after conviction, and defendants allowed or suggested Wilson a stay of execution of a Missouri prison sentence, in direct violation of Missouri Rules of Criminal Procedure and Missouri Revised Statutes. The complaint also alleges that the court modified the contract with L&C by allowing Wilson a 30-day stay on his sentence at Missouri DOC, which L&C contends is a post-trial matter not covered by his pre-trial bond.

The case is related to the case filed in December by L&C against the Missouri Department of Insurance. Both case have been filed in the US District Court, Western District of Missouri.

Earlier coverage of this case here:

Appellant Court Rules Against L&C
MO Supreme Court Denies L&C Case
DIFP Files Complaint Against L&C
Press coverage from KMBC-9