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Monday, February 9, 2009

Guest Editorial on HB628

Editor's Note: The following is a guest editorial submitted by Bart Cooper of Bart Cooper Bail Bonds. The letter addresses the industry concerning HB628:

As many of you know, HB628 was recently introduced by Representative Brian Yates. This legislation attempts to address some of the issues now facing the bail industry in Missouri.

In recent years, our industry has undergone a transformation for the worse. Gone are the days of trust and cooperation among companies and agents, having been replaced with a new era of avarice and greed. While the future of bail in Missouri appears dim, I believe we can work together to strengthen and preserve our profession for years to come. Accordingly, I’m asking for your help in restoring professionalism and accountability in our profession. But first, let’s examine the history of bail in Missouri, and how we got where we are today.

How We Got Here

  1. The Good Old Days
    A. Traditionally, bail companies charged a minimum premium of ten percent per bond.
    B. The minimum premium was deemed necessary to cover potential losses and expenses while leaving some profit for the agent and general agent.
    C. The system worked and remained relatively stable for decades.
  2. What changed?
    A. More and more people entered the bail industry. The proliferation of agents surged with the publicity created by series such as “Dog”. With an investment of less than five hundred dollars for a two year license, people soon learned that bail offered a means to turn a quick profit. Often seen as an additional stream of income, general agents were quick to hire new agents.
    B. The proliferation of agents inevitably led to more general agents. Needing only ten thousand dollars and two years licensure as a bail agent, the number of companies exploded. The past three years alone has seen a more than thirty percent increase in general agents.
    C. Courts also began modifying their approach to bail. Faced with budgetary constraints, some courts began to look at alternative forms of release as a means of generating revenue and reducing costs (e.g. ten percent to the court, cash only and recognizance bonds).
    D. Beginning in 2005, some circuit courts eliminated local qualification requirements. If you were licensed by the state, you could execute bonds within the circuit without further qualification. Without the oversight of local circuit courts, companies were free to execute bonds regardless of whether they possessed the assets necessary to fully collateralize the bonds should they forfeit.
    E. This combination of factors created extreme pricing pressures. With more agents and companies competing for a decreasing number of clients, the notion of a minimum premium began disappearing. Desperate for cash to cover personal or business expenses, agents began discounting bonds and extending substantial amounts of credit. Underwriting standards started to take a back seat to cash flow. Some even turned to questionable or unethical practices in an attempt to achieve profit.
    F. The erosion of a decades-old pricing structure negatively impacted the industry. Reduced cooperation and respect among companies and agents became pervasive. No longer were we able to trust each other, regardless of the merit of ideas or sincerity of efforts. As the pricing structure continued to break down, undercapitalized generals became commonplace. Discounted premiums, inability to collect on promises to pay, and poor underwriting left many generals with more forfeitures than they could pay.
    G. Much like the homeowner who owes more on their home than it is worth, undercapitalized general agents were faced with a decision: work diligently (and possibly borrow money) to resolve the tens of thousands in forfeitures and save the ten thousand dollars assigned to the state, or walk away. Clearly, the system is now at a point where people choose to walk away from the ten thousand dollars rather than work to resolve much greater forfeiture losses.
    H. As more and more general agents walk away, courts are left with more judgments than the ten thousand dollar assignment can cover. Frustrated by the breakdown in the bail process, courts become increasingly dissatisfied with the professional bail industry. This dissatisfaction, coupled with the budgetary pressures noted above, lead courts to adopt alternative forms of release. With fewer bonds available, the competition increases and the cycle repeats itself.

Current State of Bail

  1. The Department of Insurance, Financial Institutions and Professional Registration (DIFP) now acknowledges that there are too many bail agents for the system to function properly.
  2. DIFP also realizes that the current deposit requirement of ten thousand dollars is never sufficient to cover losses of generals who walk away from the business.
  3. Courts are becoming increasingly dissatisfied with the commercial bail industry.

Why Act Now

  1. The industry is nearing a point of catastrophic failure. Without action on our part, the DIFP and courts will be forced to act. Although we do not know exactly what these actions will entail, they could include raising the amount of assignment or altogether eliminating commercial bail.
  2. We must begin working together to control our industry. In states where commercial bail is strong, licensing requirements are also strong. Strong licensing requirements foster strong bail associations, which in turn strengthen the commercial bail industry as a whole.
  3. We are legislatively positioned to achieve results now. With support from both lawmakers and the DIFP, we are poised to reform our industry and restore professionalism and credibility.


I have proposed legislation which I believe will begin to restore professionalism and accountability to the commercial bail industry in Missouri. The legislative changes are as follows:

  1. Eliminate felons from the industry.
  2. Increase the assignment for new general agents licensed after August 28, 2009 (when the legislation takes effect) to fifty thousand dollars.
  3. Require every general agent to assign five thousand dollars to the State of Missouri any time they add an agent after August 28, 2009.
  4. Allow the DIFP to raise the assignment requirement to fifty thousand dollars for any agent should they deem it necessary (for cause).
  5. Raise the non-resident assignment to fifty thousand dollars.

I ask you to join me in promoting this legislation. While by no means a solution to all our problems, the proposed changes represent a start at attempting to address the issues before DIFP and the courts take matters into their own hands. Together we can begin restoring credibility, professionalism and cooperation in the Missouri commercial bail industry.

I look forward to discussing the proposed changes with you.

Bart W. Cooper, General Agent


  1. Just a couple random questions from someone just getting into Bail Bonds. I am not a felon but just wondering of the removal of felons from the industry would only affect the future agents or if it would prevent current felons with bail bond licenses from renewing their licenses? Also would the 5000 per agent only affect new agents or would an agent transferring from one General to another Company require another 5000 put up? For example if I work for a general who writes a bad bond and ends up walking away from his business, If I find a new general to work under would the new General also need a 5000 deposit for me to work for him?

  2. I can assume the 5000.00 put up by the general will actually be paid by the agent. What provisions will be in place to ensure that the money will be returned in the event the agent changes general's? Will there be a time limit on how long the general holds the money after the agent leaves? How do you plan to keep the general from holding on to the money or possibly holding it hostage to stall the agent from seeking employment elsewhere? Who will intervene in the event that there is a dispute over the 5000.00? Who will take on this responsibility? How will you stop this from becoming a similar situation to the disputes over BUFF funds that plague this business?

  3. Read Much? The $5,000 will be set with the state just like the generals current CD.

    Angela: Instead of posting comments from these individuals who don't understand why don't you simply answer their questions?

  4. I understand that the money will be set with the state, that was not my question. I asked who would oversee that the general returns that money to the agent, the time frame given to return it and who will intervene in the event there is a dispute over that money. Do you read much? If your going to make such a proposal be prepared to answer the questions. I cannot support an idea without all the details.

  5. Would some one (Bart) please explain how having "pled guilty" to a felony vs "convicted" of a felony is good for this business. People that 'pled guilty" to a felony and recieved an S.I.S SHOULD be able to write bail. Just like before the 15 year rule. An S.I.S is NOT A CONVICTION and therefor should not considered when applying for your license. I would like to hear Bart on this one. Thank you in advance.

  6. In reply to anonymous poster who asked:

    Angela: Instead of posting comments from these individuals who don't understand why don't you simply answer their questions?

    Answer: Since many of these questions are submitted to Missouri Bondsman anonymously, I have no way of knowing who asked the question, therefore have no way of contacting the poster without posting the question to my site.

    I also do not have all of the answers. The previous poster asks: Assuming the cost of $5,000 CD is passed on from the GA to the agent, and the GA has been reimbursed for the cost of CD, how would the agent then be reimbursed for the cost of the CD if the agent decided to part from the GA. The poster further asks who would be responsible for dispute resolution if there is a dispute over the funds when the agent leaves. Good question, but I don't know the answer. I could speculate that such an arrangement would need to be addressed in the contract between GA and agent. Then, who would be responsible for the dispute resolution on the contract? I guess that would be up to the DIFP and/or the courts.

    I would encourage you or any other poster to answer any question you feel qualified to answer. I have enjoyed the exchange of ideas and debate about how the industry could/should be regulated.

  7. I'd personally pony up 5 grand tomorrow even though I'm apparently grandfathered in.

    I consider myself a professional, not a hobbyist and I concure with Bart's assement.

    Out with the felons, SIS or otherwise.

    Out with the weekend warriors.

    Out with the cutthroats.

    I speak for myself and not my General but I know he's of similar mind.

  8. I appreciate the thoughtful questions regarding how HB628 will work. Here are some very brief answers.

    1. How will the bill affect felons?
    As currently written, HB628 only removes the phrase "within the past fifteen years" from the current statute (RSMo 374.755.1(2). While purely speculation on my part, I expect DIPF will continue to interpret the remainder of this statute in the same manner as in the past, the only difference being that they would apply the statute to all felons rather than just those with a felony in the past fifteen years.

    2. How will the $5,000.00 dollar assignment per agent function?
    The general bail bond agent is responsible for assigning $5,000 dollars to the state for each agent the general hires after this provision becomes law. While this requirement rests solely with the general agent, I believe you are correct in assuming that most general agents will pass the cost of the assignment onto the agent. While I cannot speak for how other general agents operate, if I choose to pass the cost on to a new agent, I will do so in accordance with terms outlined in a written contract with the agent. Should the agent choose to leave my company, the return of the five thousand dollars will be governed in the same manner as the agent's build-up fund (as specifically set forth in our written contract). Again, I cannot speak for how other general agents operate, but I strongly encourage you to have a written contract that you understand.

    With regard to what happens to the deposit if the general agent goes out of business, the answer is that your new general agent would have to put up $5,000 to license you under their authority. This could result in some agents having to contribute $5,000 to more than one general agent if both the new general and old general require the agent to fund the assignment.

    Just as with a build-up fund, there is some degree of risk that your employer (general agent) will mismanage or otherwise squander your hard-earned dollars. Mitigate this risk by checking out your general agent (make sure they are financially sound and engage in ethical business practices). Most importantly, have a written contract specifically setting forth the management of your agent deposit and your build-up fund. If you need help with this, let me know. I'd be happy to share a copy of my contract.
    As a final note, please be aware that I'm not the person who posted the "Read Much" comment. My comments will always be listed under my name.
    Thanks for your interest.

  9. I have been in this business for a long time and as Mr. Cooper, I have seen this business go from bad to worse. I happen to like the new proposal. There have been bondsman popping up like bad weeds all over the state and most of them do not have 2 nickles to rub together,let alone have enough money to pay forfietures.

    If the $5000.00 requested of agents was put up in the same form as the Generals CD, then the CD is in the agents name, at his/her bank paying them interest. It is only assigned to the state in the event the state needs to attatch it for a forfieture.

    Response to if you plead guilty to a felony as part of a plea agreement to recieve an S.I.S. that tells me, you still committed a felony crime and you just had a lame prossecutor who let you plead down. A criminal is a criminal, is a criminal no matter what kind of deal or plea agreement was given to you. We are suppose to be above the people we are getting out of jail (you think?)

  10. I don't think imposing additional fees on generals and agents is the answer to the problem of unprofessionalism in the bail bond industry. While it will certainly thin the competition by killing off the smaller operations, it won't make those that survive any more honest or any smarter.

    If you want to eliminate unprofessional bondsman in this industry, then repeal sections 374.755.2 and 374.755.3 of chapter 374, which allow unscrupulous bail bond agents to buy their way out of punitive actions when they violate state laws and DIFP regulations. The examples in the post dated January 31, 2009 and titled “Recent Licensing Actions” are almost scary.

    Next, DIFP needs to stand up and conduct more thorough background checks for applicants seeking licensure, thus eliminating the licensing of convicted criminals. A case like that of Edward Loughary never should have occurred, and it certainly never should have taken over two years to resolve.

  11. I am a licensed bondsman. I am not unscrupulous, thieving, or unprofessional. I do like a set fee that all bonding agents should have to go by. I just had to change agents because my company was not professional. If I had to pay $5,000 I would have not been able to continue in my profession. Why should I be punished for others actions? I agree that the DIFP needs to stand up and conduct more thorough background checks for applicants seeking licensure. There should be a set fee that everyone has to charge so there will be no argument amongst the industry.
    Saint Louis charges %30.

  12. I agree with anonymous, I don't think imposing additional fees on generals and agents is the answer to the problem of unprofessionalism in the bail bond industry. It will kill off smaller operations, it won't make those that survive any more honest or any smarter. I only make 35% I don't have enough money to gather together to pay a $5,000 fee. Hire smarter bounty hunters that actually work.

  13. Fourteen years ago, I started out competing in the local bondsman wars, and strived to get my name out in the community all while learning the art of bail bonding. I miss the old days; at least there was a large amount of business to fight for.

    Soon after being licensed, I joined and attended the only bail bond association. I’ll never forget some of the old school GA’s warning us of the impending procedures to be implemented by the Courts. The industry failed to listen, much less try to work together to satisfy the wants and needs of the Courts and the Department of Insurance. What is happening now did not just occur; it has been in the works for over fifteen years.

    It is my opinion that it would be nearly impossible to organize bail agents into one strong association; I have been a member of at least four. I believe that the General Agents should organize and fight for our industry.

    I see good and bad in Mr. Cooper’s attempt to save a dying industry, at least he’s trying. I also understand Mr. Thomas’s concern about a few well intentioned people trying to change the system for the many. It has to be a group effort. It has been my experience that a proposed bill like HB628 has a way of changing into living nightmare for everyone.

    We need some changes like (like this will happen):
    • Raise the requirements of mandatory training for new bail agents, the schooling required should be at least a one week course, teaching several more phases of the industry on the collage level. There are a lot of Bail Agents working now who do not understand every aspect of the bonding business.
    • Higher licensing fees.
    • In Indiana, bondsmen are legally an “Office of the Court” with strict guidelines and a very close relationship with the courts. This would bring credibility and respect to the industry in Missouri.
    • Set a required minimum fee of ten percent with a suggestive minimum fee of $75.00 per bond.
    • Set a required minimum fee of twenty percent for bonds with a charge of “failure to appear”.
    • A mandatory additional charge to defendants who “failed to appear” on another charge (Make it undesirable to miss court on purpose; a lot of courts do not punish offenders).
    • A professional surety bond will be accepted the same as a Cash Bond (this one is in my opinion the most important).
    • No financing of a bond fee.
    • Require Courts/Counties accepting Ten percent bonds and cash bonds to hold forfeiture hearings and then pay the full amount of the bond to the School system when their clients fail to appear (it would only take one for them to stop setting these types of bonds).
    • Requiring General Agents to qualifying financially every six months with each Judicial Circuit that they desire to do business in, instead of placing a CD with the State.

    There you go, that’s my two cents for now, chew me up.

    Ben Hilton

  14. Take a look at your neighbor Oklahoma and our Bail Bond Statues. Go to

    Scroll down to the 2009 Bail Bonds Statues and have a read.

    Similar statutes to what some proposed here, however I'd like to see the mandantory 10% plus some of what Ben outlined.


Although Missouri Bondsman encourages debate on topics of interest to the bail industry, please be aware that comments are moderated. Please observe the posting rules. No comments will be printed that contain spam, profanity, or libelous comments. Please post comments in a civil, professional manner.