Surety bonds are used in any situation where an agent guarantees that a party (person or corporate entity) will perform in a certain way or complete and action to a third party’s satisfaction. Surety bonds are part of most construction contracts and used to guarantee fiduciary honesty. A use for the surety bond that is unique to the U.S. and only a few other countries in the world, though, is its use in courts by agents called bail bondsmen.
A surety bail bond is issued by a company, through its agent or “bail bondsman”, insuring the appearance of a defendant. The defendant pays the bail agent a non-refundable fee equivalent to a percentage of the bail amount to provide this guarantee to the court. Most surety companies either have an insurance policy to cover losses or self-insure, using their profits as collateral. Some surety bail bond agents are responsible businesspersons but the industry is largely unregulated and many bondsmen become “bounty hunters” if their clients flee, charging the court for warrant service and retrieval of their own clients.
The word surety comes from a Latin root meaning “security.” In medieval Europe, where money was practically nonexistent, bondsmen were persons who vouched for another and took possession of them for the court until a trial was held–a condition of servitude that might last for years. Many of the settlers of the English colonies were bonded in service to royal governors or the Crown itself. The concept of an obligation to guarantee certain performance became part of the American court system as bail bond agents agreed to “guarantee” their clients’ appearance in court and set out to find them if they didn’t. The bail surety agent survived the same way as any insurance company—by charging premiums (including commercial fees) to his client.
The practice of the surety bail bond thrives in American courts where bail amounts are set so high that the poor cannot afford them. Bail bond agents offer these defendants a way to “get out of jail” until trial and give the court a guarantee that the defendant will appear. What should be a win-win situation is really a way for the surety agent to make a profit at the expense of defendants least able to afford the agent’s non-refundable fees.
Bail bond agents are a privately-owned, for-profit adjunct to the justice system, a fact that annoys courts and legislatures. Several states have eliminated the agents by allowing defendants to post the same fraction (usually 10 percent) of the entire bail amount directly to the court as they would pay a surety company. The use of this “cash bail” and increasing use of signature bonds (a signature by the defendant acknowledging receipt of a warrant for arrest should he not return as agreed) and recognizance bonds (releasing a defendant upon a promise to return) have, in these states, replaced the surety bail bond.
Surety bonds allow defendants who might not otherwise be able to post bail to gain their release to work on a defense. Since defendants are considered innocent until proven guilty at trial, high bail amounts without access to the surety bail bond constitutes a violation of Habeas Corpus rights of the accused. Only by consistently setting bail amounts that match the resources and flight potential of defendants can courts eliminate the ever-present bail bond agent.