A10640 Summary:

BILL NO    A10640B

SAME AS    SAME AS S07752

SPONSOR    Rules (Aubry)

COSPNSR    Boyle, Rivera P, Heastie, Lentol, Lifton

MLTSPNSR   

Amd SS1108, 6801, 6802 & 6803, add S6805, Ins L

Relates to charitable bail organizations; authorizes the superintendent to
issue certificates to a charitable bail organization to deposit money as bail
under certain circumstances.
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A10640 Memo:

BILL NUMBER:A10640B           REPLACEMENT 6/21/12

TITLE OF BILL:
An act to amend the insurance law, in relation to charitable bail organ-
izations

PURPOSE:
This bill provides the legal definition and requirements for charitable
bail organizations organized for the purpose of posting cash bail for
poor persons.

SUMMARY OF PROVISIONS:
Section 1 of this bill amends section 1108 of the insurance law by
adding a new subsection (k) to include a charitable bail organization as
an entity which may be issued a certificate by the superintendent.

Section 2 of this bill amends subsections (a) and (b) of section 6801 of
the insurance law to include a charitable bail organization in the defi-
nition of an entity conducting a bail business.

Section 3 of this bill amends subsections (a), (b), (c), (h), and (m) of
section 6802 of the insurance law outlining the application for certif-
ication process to include a charitable bail organization.

Section 4 of this bill amends section 6803 of the insurance law author-
ing a bail organization to operate in a city containing a population
greater than one hundred seventy-five thousand.

Section 5 of this bill adds a new section 6805 to the insurance law
defining a charitable bail organization, its structure, powers and limi-
tations, certification, review and renewal including the stipulation
that no charitable bail organization may charge a premium or receive
compensation for its services which shall be provided only to persons
determined to be financially unable to post bail.

Section 6 is the effective date.

JUSTIFICATION:
Occasionally, charitable groups with knowledge of particular indigent
persons post bail on behalf of such persons. Since these organizations
do not charge a premium or receive compensation for cash bail paid, they
are unable to meet the significant fiscal burdens imposed by Insurance
Law provisions that are designed to regulate for-profit corporations
engaged full-time in the bail bond business. This bill provides a struc-
ture for such organizations to exist and operate under the purview of
the Insurance Department.

FISCAL IMPLICATIONS:
None.

EFFECTIVE DATE:

This act shall take effect ninety days after it shall have become law.
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A10640 Text:

                           S T A T E   O F   N E W   Y O R K
       ________________________________________________________________________

                                       10640--B

                                 I N  A S S E M B L Y

                                     June 12, 2012
                                      ___________

       Introduced  by  COMMITTEE  ON  RULES  --  (at request of M. of A. Aubry,
         Boyle, Heastie, Lentol, Lifton) --  read  once  and  referred  to  the
         Committee  on  Codes  --  committee  discharged, bill amended, ordered
         reprinted as amended and recommitted to said committee -- reported and
         referred to the Committee on Ways and Means --  committee  discharged,
         bill  amended,  ordered  reprinted  as amended and recommitted to said
         committee

       AN ACT to amend the insurance law, in relation to charitable bail organ-
         izations

         THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
       BLY, DO ENACT AS FOLLOWS:

    1    Section  1.  Section  1108 of the insurance law is amended by adding a
    2  new subsection (k) to read as follows:
    3    (K) A CHARITABLE BAIL ORGANIZATION HOLDING A CERTIFICATE ISSUED BY THE
    4  SUPERINTENDENT PURSUANT TO SECTION SIX THOUSAND EIGHT  HUNDRED  FIVE  OF
    5  THIS CHAPTER.
    6    S  2. Subsections (a) and (b) of section 6801 of the insurance law are
    7  amended to read as follows:
    8    (a) (1) Any person, firm or corporation in any court  having  criminal
    9  jurisdiction  or  in  any  criminal  action  or proceeding who shall for
   10  another deposit money or property as bail or execute as surety any  bail
   11  bond who within a period of one month prior thereto shall have made such
   12  a  deposit  or given such bail in more than two cases not arising out of
   13  the same transaction shall be deemed to be doing a bail [bond]  business
   14  and  doing  an  insurance  business as defined in article eleven of this
   15  chapter.
   16    (2) Except for a corporation authorized to write fidelity  and  surety
   17  insurance and to do a bail [bond] business pursuant to the provisions of
   18  article  eleven  of  this  chapter  and otherwise in compliance with all
   19  other requirements of this chapter to do such business OR  A  CHARITABLE
   20  BAIL  ORGANIZATION  HOLDING  A  CERTIFICATE ISSUED BY THE SUPERINTENDENT
   21  PURSUANT TO SECTION SIX THOUSAND EIGHT HUNDRED FIVE OF THIS ARTICLE  AND
   22  OTHERWISE  IN  COMPLIANCE WITH ALL OTHER REQUIREMENT OF THIS CHAPTER, no

        EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                             [ ] is old law to be omitted.
                                                                  LBD16177-04-2
       A. 10640--B                         2

    1  person, firm or corporation shall engage in [such] A  BAIL  business  IN
    2  THIS STATE.
    3    (b)  (1)  No  person,  firm  or  corporation shall in this state do an
    4  insurance business or a bail [bond] business as  defined  in  subsection
    5  (a)  of  this section unless authorized by a license issued and in force
    6  as provided under article eleven of this chapter.
    7    (2) The superintendent may  authorize  a  property/casualty  insurance
    8  company which is authorized to write fidelity and surety insurance to do
    9  a  bail  [bond]  business  in  accordance with the provisions of article
   10  eleven of this chapter, but no individual shall be licensed to  do  such
   11  business.
   12    S  3.  Subsections  (a),  (b), (c), (h) and (m) of section 6802 of the
   13  insurance law, subsection (m) as amended by chapter 285 of the  laws  of
   14  1993, are amended to read as follows:
   15    (a)  No person, firm or corporation or any officer or employee thereof
   16  shall act in this state as an agent or solicitor of an insurer OR CHARI-
   17  TABLE BAIL ORGANIZATION doing a  bail  [bond]  business  in  soliciting,
   18  negotiating or effectuating any such deposit or bail bond by such insur-
   19  er OR CHARITABLE BAIL ORGANIZATION unless licensed by the superintendent
   20  as an agent pursuant to the provisions of this section. Any person, firm
   21  or  corporation so acting without being duly licensed shall be guilty of
   22  a misdemeanor.
   23    (b) Every corporation OR CHARITABLE BAIL ORGANIZATION engaging  as  an
   24  insurer  [in the business of giving] DOING A bail BUSINESS IN THIS STATE
   25  shall procure a license pursuant to the provisions of this  section  for
   26  each  of its employees, officers and agents acting for it in soliciting,
   27  negotiating or effectuating any such deposit or bail bond.
   28    (c) The superintendent may, in [his] THE SUPERINTENDENT'S  discretion,
   29  issue to any person, firm or corporation a license to act as an agent of
   30  an  authorized  insurer  OR CHARITABLE BAIL ORGANIZATION, in soliciting,
   31  negotiating or effectuating any such deposit or bail bond by such insur-
   32  er OR ANY SUCH DEPOSIT BY SUCH CHARITABLE BAIL ORGANIZATION.
   33    (h) In order to determine the  competence  of  each  applicant  for  a
   34  license  or  a sublicense, the superintendent shall require every appli-
   35  cant to pass to the satisfaction of the superintendent a  written  exam-
   36  ination  to  be  prepared  by  the superintendent and appropriate to the
   37  doing of a bail [bond] business. If the applicant or any proposed subli-
   38  censee intends to maintain an office or solicit,  negotiate,  effectuate
   39  or deposit bail on behalf of another in any city containing a population
   40  of more than one hundred seventy-five thousand, such written examination
   41  may  inquire  into the applicant's knowledge of the pertinent provisions
   42  of the criminal procedure law and the pertinent rules and  practices  of
   43  the courts and district attorneys' offices within the area of the appli-
   44  cant's proposed operations. Such examination shall be held at such times
   45  and places as the superintendent shall determine.
   46    (m)  Every  license  issued  to  an  officer, employee, or agent of an
   47  insurer OR CHARITABLE BAIL ORGANIZATION doing  a  bail  [bond]  business
   48  pursuant  to  this  section  shall be for a term expiring on the thirty-
   49  first day of December of even numbered years and may be renewed for  the
   50  ensuing two calendar years upon the filing of a renewal application. The
   51  superintendent  may  refuse  to  issue  any such license if in [his] THE
   52  SUPERINTENDENT'S judgment such refusal will best promote  the  interests
   53  of  the  people of this state. Every such licensee and sublicensee shall
   54  file an information statement on  or  before  the  thirty-first  day  of
   55  December  of  each  even  numbered  year, the form and subject matter of
   56  which may be prescribed by the superintendent.
       A. 10640--B                         3

    1    S 4. Section 6803 of the insurance law is amended to read as follows:
    2    S  6803.  Bail bond business; cities in excess of one hundred seventy-
    3  five thousand. (a) An insurance corporation OR CHARITABLE BAIL ORGANIZA-
    4  TION engaged in the BAIL business [of giving bail] in a city  containing
    5  a population of more than one hundred seventy-five thousand inhabitants,
    6  according  to  the  last  preceding federal census or state enumeration,
    7  shall file with the district attorney of each county contained  in  such
    8  city or in which such a city is contained, the clerks of the supreme and
    9  county  courts  and  the  clerk of the criminal court of the city of New
   10  York, certified statements of the names of  all  persons  authorized  to
   11  execute  bail  bonds  OR  EFFECTUATING  SUCH DEPOSIT on its behalf or to
   12  solicit such  business  as  agent,  together  with  a  certificate  duly
   13  executed  by  the  superintendent,  certifying with respect to each such
   14  person, that such person has been licensed by the superintendent  pursu-
   15  ant to section six thousand eight hundred two of this article.
   16    (b)  The  court  or  other  public officer concerned in the matter may
   17  examine under oath any insurer OR CHARITABLE BAIL ORGANIZATION  doing  a
   18  bail [bond] business or a depositor of security for bail, or the officer
   19  or  agent of any such insurer, CHARITABLE BAIL ORGANIZATION or depositor
   20  proposing to execute a bail bond, or to make such  deposit,  as  to  the
   21  indemnity, if any, deposited or otherwise provided directly or indirect-
   22  ly  against loss by reason of the deposit or bail bond and as to the fee
   23  charged, IF ANY, for the giving of such bond. The court or other  public
   24  officer concerned in the matter may refuse to accept such bond or depos-
   25  it  if  satisfied that any portion of such security has been feloniously
   26  obtained by the defendant, or that the provisions of this or  any  other
   27  section  of law have been violated, or that the person or persons indem-
   28  nifying such insurer or depositor shall have  within  a  period  of  one
   29  month  prior  thereto given indemnification or security for like purpose
   30  in more than two cases not arising out of the same transaction and  that
   31  such  person  is  not  duly licensed by the superintendent in accordance
   32  with the provisions of this chapter.
   33    S 5. The insurance law is amended by adding a new section 6805 to read
   34  as follows:
   35    S 6805. CHARITABLE BAIL ORGANIZATION. (A)(1)  THE  SUPERINTENDENT  MAY
   36  ISSUE  A  CERTIFICATE TO A CHARITABLE BAIL ORGANIZATION TO DEPOSIT MONEY
   37  AS BAIL FOR ANOTHER IN ACCORDANCE WITH THE PROVISIONS  OF  THIS  SECTION
   38  ONLY  IF  SUCH ENTITY IS A NON-PROFIT ORGANIZATION ORGANIZED PURSUANT TO
   39  THE  UNITED  STATES  INTERNAL  REVENUE  CODE  AS  DESCRIBED  BY  SECTION
   40  501(C)(3)  OF  TITLE  26  OF  THE UNITED STATES CODE, IS REGISTERED AS A
   41  CHARITY PURSUANT TO ARTICLE SEVEN-A OF THE EXECUTIVE LAW AND IS  CURRENT
   42  ON SUCH REGISTRATION.
   43    (2)  THE  APPLICATION  FOR  A CHARITABLE BAIL ORGANIZATION CERTIFICATE
   44  SHALL BE IN SUCH FORM OR FORMS, AND SHALL CONTAIN RELEVANT  INFORMATION,
   45  AS THE SUPERINTENDENT SHALL PRESCRIBE.
   46    (3) THE SUPERINTENDENT MAY REFUSE TO ISSUE A CHARITABLE BAIL ORGANIZA-
   47  TION  CERTIFICATE IF, IN THE SUPERINTENDENT'S JUDGMENT, AN APPLICANT, OR
   48  AN OFFICER OR DIRECTOR OF THE APPLICANT, HAS: (A) DEMONSTRATED  UNTRUST-
   49  WORTHINESS  OR  INCOMPETENCE;  (B)  GIVEN  CAUSE  FOR  THE REVOCATION OR
   50  SUSPENSION OF THE CERTIFICATE; OR (C) FAILED TO COMPLY WITH ANY  PREREQ-
   51  UISITE FOR THE ISSUANCE OF THE CERTIFICATE.
   52    (4)  A  CHARITABLE  BAIL ORGANIZATION CERTIFICATE SHALL BE VALID FOR A
   53  TERM OF FIVE YEARS FROM ISSUANCE. AT THE TIME OF APPLICATION  FOR  EVERY
   54  SUCH  CERTIFICATE, AND FOR EVERY RENEWAL THEREOF, AN APPLICANT SHALL PAY
   55  TO THE SUPERINTENDENT A SUM OF ONE THOUSAND DOLLARS PAYABLE EACH TERM OR
       A. 10640--B                         4

    1  FRACTION OF A TERM, PROVIDED, HOWEVER, THAT IN HIS  OR  HER  DISCRETION,
    2  THE SUPERINTENDENT MAY WAIVE SUCH FEE.
    3    (5)  IF AN APPLICATION FOR A RENEWAL CERTIFICATE SHALL HAVE BEEN FILED
    4  WITH THE SUPERINTENDENT BEFORE THE EXPIRATION OF SUCH CERTIFICATE,  THEN
    5  THE  CERTIFICATE  SOUGHT  TO BE RENEWED SHALL CONTINUE IN FULL FORCE AND
    6  EFFECT EITHER UNTIL THE ISSUANCE BY THE SUPERINTENDENT  OR  THE  RENEWAL
    7  CERTIFICATE  APPLIED  FOR  OR  UNTIL  FIVE DAYS AFTER THE SUPERINTENDENT
    8  SHALL HAVE REFUSED TO ISSUE SUCH RENEWAL CERTIFICATE.
    9    (6) THE SUPERINTENDENT MAY REFUSE TO RENEW OR MAY REVOKE OR SUSPEND  A
   10  CHARITABLE  BAIL ORGANIZATION CERTIFICATE FOR A REASONABLE PERIOD DETER-
   11  MINED BY THE SUPERINTENDENT IF, AFTER NOTICE  AND  HEARING,  THE  SUPER-
   12  INTENDENT  DETERMINES  THAT  AN  APPLICANT OR LICENSEE, OR AN OFFICER OR
   13  DIRECTOR OF THE APPLICANT OR LICENSEE, HAS: (A) DEMONSTRATED UNTRUSTWOR-
   14  THINESS OR INCOMPETENCE; (B) VIOLATED THIS SECTION OR  AUTHORIZED  REGU-
   15  LATIONS PROMULGATED THEREUNDER; OR (C) FAILED TO STAY CURRENT WITH THEIR
   16  REGISTRATION  AS  A CHARITY PURSUANT TO ARTICLE SEVEN-A OF THE EXECUTIVE
   17  LAW. ANY HEARING CONDUCTED UNDER THIS  SECTION  SHALL  COMPLY  WITH  THE
   18  REQUIREMENTS  OF  SECTION  THREE  HUNDRED FIVE OF THE FINANCIAL SERVICES
   19  LAW.
   20    (B) A CHARITABLE BAIL ORGANIZATION SHALL:
   21    (1) ONLY DEPOSIT MONEY AS BAIL IN THE AMOUNT OF TWO  THOUSAND  DOLLARS
   22  OR LESS FOR A DEFENDANT CHARGED WITH ONE OR MORE MISDEMEANORS, PROVIDED,
   23  HOWEVER, THAT SUCH ORGANIZATION SHALL NOT EXECUTE AS SURETY ANY BOND FOR
   24  ANY DEFENDANT;
   25    (2) ONLY DEPOSIT MONEY AS BAIL ON BEHALF OF A PERSON WHO IS FINANCIAL-
   26  LY  UNABLE  TO  POST  BAIL,  WHICH MAY CONSTITUTE A PORTION OR THE WHOLE
   27  AMOUNT OF SUCH BAIL;
   28    (3) ONLY DEPOSIT MONEY AS BAIL IN ONE COUNTY IN THIS STATE.  PROVIDED,
   29  HOWEVER,  THAT  A  CHARITABLE BAIL ORGANIZATION WHOSE PRINCIPAL PLACE OF
   30  BUSINESS IS LOCATED WITHIN A CITY OF A MILLION OR MORE MAY DEPOSIT MONEY
   31  AS BAIL IN THE FIVE COUNTIES COMPRISING SUCH CITY; AND
   32    (4) NOT CHARGE A PREMIUM OR RECEIVE COMPENSATION FOR ACTING AS A CHAR-
   33  ITABLE BAIL ORGANIZATION.
   34    (C) THE SUPERINTENDENT MAY PROMULGATE  REGULATIONS  IMPLEMENTING  THIS
   35  SECTION.
   36    S  6.  This  act shall take effect on the ninetieth day after it shall
   37  have become a law.
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