Local bonding company could have privileges revoked

By Kathy Helms-Hughes


   A bail bonding company could have its bonding privileges revoked, according to District Attorney General Joe Crumley, who filed a motion Friday in Washington County against Sam I Am of Elizabethton.
   The filing followed a court hearing Thursday in Carter County Criminal Court.
   "Yesterday, what happened is there was a $3,000 bond, and a friend of (the defendant) wired $1,300 to the bonding company. Initially, Judge (Robert) Cupp thought they had charged $1,300 to make a $3,000 bond, and by statute you can only charge 10 percent. But what it was is they took their $300 and then gave a friend of the defendant the rest of the money. It appears that the friend may have been trying to rip him off," Crumley said Friday.
   Bonding companies, technically, are regulated by the courts. They are required to file annual reports on their financial situation and also must receive accredited training each year.
   According to Carter County Circuit Court, Samra Coffey of Elizabethton, doing business as Sam I Am, lists assets of 2-3/4 acres with a house valued at $220,000; a lot in Biltmore valued at $13,000; cash in bank, $32,000; a 1988 Chrysler LeBaron, $8,000; a 1986 Fleetwood mobile home, $5,000; and a 1982 Eagle mobile home valued at $3,500, bringing total assets to $281,000. A First Tennessee Bank Loan of $100,000 is listed as a liability.
   "Part of their assets were a $220,000 house that was insured for $500,000, and it burned. That's under investigation. The insurance company apparently has not been willing to settle this. They're still looking at it.
   "The owner, Samra Coffey, is married to David Renfro, who was just released off of parole and there are indications that he does work for them. She said yesterday (in court) that he doesn't. So I guess that's a matter of proof for the court because he's got current charges in Virginia for possession of heroin for resale and charges in Carter County for possession of morphine tablets," Crumley said.
   A hearing for Sam I Am is set March 18 in Jonesborough, "the reason being, Judge Cupp couldn't be back in Carter County until April 15," Crumley said.
   In the meantime, Sam I Am will be allowed to continue bonding.
   "On Sam I Am, there is no indication right now that they have wrongfully done anything," Crumley said.
   According to the original order signed by Judge Lynn Brown which allowed the company to do business, "they could write up to $188,000," Crumley said. "They put up a $25,000 Certificate of Deposit and were allowed to write up to $188,000 in bonds. But the problem is, one decent cocaine-related case is going to be a $25,000 bond, probably. So you can have $188,000 in bonds out, and boom! One of them absconds, and you go bankrupt," according to Crumley.
   "Some jurisdictions will go by a 10-to-1 standard. But usually it's more like you put $100,000 on deposit and you can write up to $1 million on the theory that you've got maybe a 20-to-30 percent maximum that are going to default. I've never seen a $25,000 one before, and I'm not thrilled about that, to say the least."
   According to General Crumley, the First Judicial District has had a rash of issues with bonding companies recently. Central Bail Bonds was suspended after investigation revealed $162,500 worth of invalid bonds in a six-month period, mostly in Carter and Unicoi counties, he said.
   A motion also was filed to suspend Sanford and Son, however, that motion was withdrawn last Friday because they corrected their problems.
   "Some of these are insurance-backed and you have to attach to the bond a power of attorney in the appropriate amount of the bond. Some of the companies know that everybody in the system isn't aware of the power-of-attorney requirement, so they're filing bonds without it. That way, if somebody skips, the insurance company is not liable," he said.
   "What's scary on these insurance-based companies is, let's say you've got $150 million on deposit, but that may be in Oklahoma. You may have 12 agents in Tennessee, 12 in Georgia, 12 in Florida, and each of them may be writing up $1 million in bonds. It looks like a tremendous amount of money on deposit, when in actuality, you may have three or four times that amount out.
   "I know we've had one insurance company go out of business and go bankrupt that had agents writing bonds in this district, so that just left them backed with nothing," Crumley said.
   Most of the bonding companies that are property-backed or cash-backed are people who have been around for a long time, he said, and are the ones that have been pretty successful.
   "What's scary is, what if you come to me and give me $1,500 to make a $15,000 bond, and I do the bond but I don't attach the power of attorney? It's really invalid. So then some bald-headed DA comes in and files a motion to revoke your bond because it's not secured, but you've paid the bondsman a whole bunch of money. On the one hand, it isn't secured; but on the other, the defendant, in good faith, has paid a bonding company.
   "The state of Tennessee has an interest in making sure these people are on a secured bond so there's something to guarantee that they'll show up (for court). If they aren't secured, it's an ethical dilemma. You can say: 'This is what the law is,' but then, what's fair?" Crumley said.
   "The person who is bonded could have their bond revoked but, in turn, they may turn around and be able to prosecute the bonding company for theft. You've got one foot on breach of contract and one foot on theft.
   "Then again, if you didn't do the power of attorney, there's a good chance you didn't send the money to the insurance company and you kept the entire premium for yourself, so the insurance company may be saying, 'Hey, wait a minute. You're supposed to give us 20 percent or 30 percent of that,' depending on the contract.
   "If you've got 30 percent of $162,500 worth of bonds, you're starting to get up there. And if you did that in six months, in six years you're probably well in excess of $1 million worth of bonds."
   While some district attorneys just want the bonds to be paid off, General Crumley said, "I want the body; I want the person. Because that's the only way you really get justice. There's no justice if somebody comes in, skips bond, and the bonding company just pays off the bond."
   Also, he said, there are times when a bond is set fairly low and the defendant comes in, pays the bonding company its commission, and tries to pay the amount of the bond up front.
   "Say it's a $5,000 bond. They might try to give the bonding company $5,500, which is their commission plus the amount of the bond. That's a clear indication they're gone, they will not be back," he said.
   If a bonding company does not have the money to back the bonds and the defendant skips, "Everybody's out," according to Crumley.
   Bonding companies which come to the attention of the district attorney's office will be investigated, he said.