GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 1995

S	3 

SENATE BILL 534
Second Edition Engrossed 6/1/95
Third Edition Engrossed 6/26/95

Short Title:  Bail Bondsmen Regulation/AB.	(Public)

─────────────────────────────────────── 
Sponsors: Senator Parnell.

─────────────────────────────────────── 
Referred to:  Finance

─────────────────────────────────────── 

March 30, 1995

A BILL TO BE ENTITLED
AN ACT TO AMEND THE LAW REGULATING SURETY BONDSMEN, BAIL BONDSMEN, AND RUNNERS.
The General Assembly of North Carolina enacts:
Section 1.  G.S. 58-71-1(11) reads as rewritten:
"(11)	'Surety bondsman' means any person who is licensed by the Commissioner as a surety bondsman under this Article, is appointed by an insurer by power of attorney to execute or countersign bail bonds for the insurer in connection with judicial proceedings, and receives or is promised consideration for doing so."
Sec. 2.  G. S. 58-71-40 reads as rewritten:
"§ 58-71-40.  Bail bondsmen and runners to be qualified and licensed; only individuals to be licensed; license applications generally.
(a)	No person shall act in the capacity of a bail bondsman or runner or perform any of the functions, duties, or powers prescribed for bail bondsmen or runners under the provisions of this Article unless that person shall be qualified and (except as regards an accommodation bondsman) licensed in accordance with the provisions of this Article. No license shall be issued to a professional bondsman or runner except as provided in this Article and none shall be issued except to an individual natural person.
(b)	The applicant shall apply for a license on forms prepared and supplied by the Commissioner and the Commissioner may propound any reasonable interrogatories to an applicant for a license under this Article relating to his qualifications, residence, prospective place of business, and any other matters which, in the opinion of the Commissioner, are deemed necessary in order to protect the public and ascertain the qualifications of the applicant. The Commissioner may also conduct any reasonable inquiry or investigation he sees fit, relative to the determination of the applicant's fitness to be licensed or to continue to be licensed.
(c)	The failure of the applicant to secure approval of the Commissioner shall not preclude the applicant from applying as many times as the applicant desires, but no application shall be considered by the Commissioner within one year subsequent to the date upon which the Commissioner denied the last application.
(d)	Upon the issuance of a license under this section, a picture identification card of design, size, and content approved by the Commissioner shall be issued by the Commissioner to each licensee.  Each licensee must have this card in his or her possession at all times when the licensee is working in the scope of the licensee's employment.  When the license of a licensee to whom a card has been issued is terminated, the identification card must be surrendered to the Commissioner within 10 working days of the termination."
Sec. 3.  G.S. 58-71-45 reads as rewritten:
"§ 58-71-45.  Terms of licenses.
A license issued to a bail bondsman and to a runner authorizes the licensee to act in that capacity until the license is suspended or revoked.  Upon the suspension or revocation of a license, the licensee shall return the license to the Commissioner.  A license of a bail bondsman and a license of a runner shall be renewed on July 1 of each year upon payment of the applicable renewal fee under G.S. 58-71-75.  The Commissioner is not required to print renewal licenses.  After notifying the Commissioner in writing, a bail bondsman who employs a runner may cancel the runner's license and the runner's authority to act for the bondsman."
Sec. 4.  G.S. 58-71-50 reads as rewritten:
"§ 58-71-50.  Qualification for bail bondsmen and runners.
(a)	Before a license can be issued to an applicant permitting the applicant to act as a bail bondsman or runner, the applicant must furnish the Commissioner a complete set of the applicant's fingerprints and a recent passport size full-face photograph of the applicant.  The applicant's fingerprints shall be certified by an authorized law-enforcement officer.  The fingerprints of every applicant shall be forwarded to the State Bureau of Investigation for a search of the applicant's criminal history record file, if any.  If warranted, the State Bureau of Investigation shall forward a set of the fingerprints to the Federal Bureau of Investigation for a national criminal history record check.  The Commissioner may adopt rules to establish fees to be paid by applicants to offset the cost incurred by the Commissioner to implement this subsection.  The total fee an applicant may be charged for a criminal history record check may not exceed fifty dollars ($50.00).
(b)	Every applicant for a license under this Article as a bail bondsman or runner before being issued such license shall satisfy the Commissioner that he or she:
(1)	Is 18 years of age or over;
(2)	Is a resident of this State;
(3)	Is a person of good moral character and has not been convicted of a felony or any crime involving moral turpitude;
(4)	Has knowledge, training, or experience of sufficient duration and extent to reasonably satisfy the Commissioner that he possesses the competence necessary to fulfill the responsibilities of a licensee;
(5)	Has no outstanding bail bond obligations;
(6)	Is not or has not been in violation of any provision of this Article or of Article 26 of Chapter 15A of the General Statutes or of any similar provision of law of any other state;
(7)	Has not been in any manner disqualified under the laws of this State or any other state to engage in the bail bond business."
Sec. 5.  G.S. 58-71-55 reads as rewritten:
"§ 58-71-55.  License fees.
A nonrefundable license fee of one hundred dollars ($100.00) shall be paid to the Commissioner with each application for license as a bail bondsman and a license fee of sixty dollars ($60.00) shall be paid to the Commissioner with each application for license as a runner."
Sec. 6.  G.S. 58-71-60 is repealed.
Sec. 7.  G.S. 58-71-65 reads as rewritten:
"§ 58-71-65.  Contents of application for runner's license; endorsement by professional bondsman.
In addition to the other requirements of this Article, an applicant for a license to be a runner must affirmatively show:
(1)	That the applicant will be employed by only one professional bondsman, who will supervise the work of the applicant and be responsible for the runner's conduct in the bail bond business.
(2)	That the application is endorsed by the appointing professional bondsman who shall obligate himself or herself in the application to supervise the runner's activities.
(3)	That the applicant has disclosed whether he or she has ever been licensed as a bail bondsman or runner.  If the applicant has ever been licensed as a bail bondsman, he or she shall list all outstanding bail bond obligations.  If the applicant has ever been licensed as a runner, he or she shall list all prior employment as such, indicating the name of each professional bondsman by whom he or she has been employed and the reason or reasons for the termination of the employment."
Sec. 8.  G.S. 58-71-70 reads as rewritten:
"§ 58-71-70.  Examination; fees.
Each applicant for license to be a professional bondsman, surety bondsman, or runner shall appear in person and take a written examination prepared by the Commissioner testing the applicant's ability and qualifications.  Each applicant is eligible for examination 30 days after the date the application is received by the Commissioner.  Each examination shall be held at a time and place as designated by the Commissioner.  Each applicant shall be given notice of the designated time and place no sooner than 15 days before the examination.  The fee for each examination is twenty-five dollars ($25.00).  This examination fee is nonrefundable.  The failure of an applicant to pass an examination shall not preclude him from taking subsequent examinations; provided, however, that at least one year must intervene between examinations."
Sec. 9.  G.S. 58-71-75 reads as rewritten:
"§ 58-71-75.  Renewal fees.
A licensee who desires to continuously maintain his or her license shall pay a renewal fee of sixty dollars ($60.00) in case of runners and one hundred dollars ($100.00) in case of bail bondsmen.  After the receipt of the applicable renewal fee, the current license shall continue in effect until suspended or revoked for cause."
Sec. 10.  G.S. 58-71-81 reads as rewritten:
"§ 58-71-81.  Notice of receivership.
Upon the filing for protection under the United States Bankruptcy Code by any bail bondsman licensed under this Article or by any bail bond business in which the bondsman holds a position of management or ownership, the bondsman shall notify the Commissioner of the filing for protection within three business days after the filing.  Upon the appointment of a receiver by a State or federal court for any professional bondsman licensed under this Article, or for any bail bond business in which the bondsman holds a position of management or ownership, the bondsman shall notify the Commissioner of the filing for protection within three business days after the filing.  The failure to notify the Commissioner within three business days after the filing for bankruptcy protection shall, after hearing, cause the license of any person failing to make the required notification to be suspended for a period of not less than 60 days nor more than three years, in the discretion of the Commissioner."
Sec. 11.  Article 71 of Chapter 58 of the General Statutes is amended by adding a new section to read:
"§ 58-71-82.  Other licenses issued by the Commissioner.
If licenses are issued to a bail bondsman under this Article and under Article 33 of this Chapter and the license issued under Article 33 of this Chapter is suspended or revoked for cause or is not renewed, the license issued under this Article is suspended, revoked, or not renewed as of the date the order pursuant to Article 33 of this Chapter is final."
Sec. 11.1.  G.S. 58-33-25 is amended by adding a new subsection to read:
"( e1)	If licenses are issued to a bail bondsman under this Article and under Article 71 of this Chapter and the license issued under Article 71 of this Chapter is suspended or revoked for cause or is not renewed for failure to pay the renewal fee, the license issued under this Article is suspended, revoked, or not renewed as of the date the order pursuant to Article 71 of this Chapter is final."
Sec. 12.  G.S. 58-71-82, as enacted by Section 11 of this act, reads as rewritten:
"§ 58-71-82.  Dual license holding.
If an individual holds a professional bondsman's license and a surety bondsman's license simultaneously, they are considered one license for the purpose of suspension, revocation, or renewal under this Article."
Sec. 13.  G.S. 58-71-95 reads as rewritten:
"§ 58-71-95.  Prohibited practices.
No bail bondsman or runner shall:
(1) 	Pay a fee or rebate or give or promise anything of value, directly or indirectly, to a jailer, law-enforcement officer, committing magistrate, or any other person who has power to arrest or hold in custody, or to any public official or public employee in order to secure a settlement, compromise, remission or reduction of the amount of any bail bond or the forfeiture thereof, including the payment to law-enforcement officers, directly or indirectly, for the arrest or apprehension of a principal or principals who have caused or will cause a forfeiture.
(2)	Pay a fee or rebate or give anything of value to an attorney in bail bond matters, except in defense of any action on a bond.
(3)	Pay a fee or rebate or give or promise anything of value to the principal or anyone in his behalf.
(4)	Participate in the capacity of an attorney at a trial or hearing of one on whose bond he is surety, nor suggest or advise the employment of, or name for employment any particular attorney to represent his principal.
(5)	Accept anything of value from a principal or from anyone on behalf of a principal except the premium, which shall not exceed fifteen percent (15%) of the face amount of the bond; provided that the bondsman shall be permitted to accept collateral security or other indemnity from a principal or from anyone on behalf of a principal.  Such collateral security or other indemnity required by the bondsman must be reasonable in relation to the amount of the bond and shall be returned upon final termination of liability on the bond.  The failure of the bondsman or runner to return collateral security valued at five hundred dollars ($500.00) or more upon or within 30 days after final termination of liability on the bond is punishable as a Class I felony.
(6)	Solicit business in any of the courts or on the premises of any of the courts of this State, in the office of any magistrate and in or about any place where prisoners are confined.  Loitering in or about a magistrate's office or any place where prisoners are confined shall be prima facie evidence of soliciting.
(7)	Advise or assist the principal for the purpose of forfeiting bond."
Sec. 14.  G.S. 58-71-105 reads as rewritten:
"§ 58-71-105.  Persons prohibited from becoming surety or runners.
No sheriff, deputy sheriff, other law-enforcement officer, judicial official, attorney, parole officer, probation officer, jailer, assistant jailer, employee of the General Court of Justice, nor other public employee assigned to duties relating to the administration of criminal justice, nor the spouse of any such person, may in any case become surety on a bail bond for any person.  In addition, no person covered by this section may act as an agent for any bonding company or bail bondsman.  No such person may have an interest, directly or indirectly, in the financial affairs of any firm or corporation whose principal business is acting as a bail bondsman.  However, nothing in this section prohibits any such person from being surety upon the bond of his or her spouse, parent, brother, sister, child, or descendant."
Sec. 15.  G.S. 58-71-115 reads as rewritten:
"§ 58-71-115.  Insurers to annually report surety bondsmen; notices of appointments and terminations; information confidential.
Before July 1 of each year, every insurer shall furnish the Commissioner a list of all surety bondsmen appointed by it to write bail bonds on its behalf. Every such insurer who subsequently appoints a surety bondsman in the State shall give notice of the appointment to the Commissioner. All such appointments shall be subject to the issuance of the proper license to the appointee under this Article.
An insurer terminating the appointment of a surety bondsman shall file written notice of the termination with the Commissioner, together with a statement that it has given or mailed notice to the surety bondsman and to the clerk of superior court of any county in the State in which the insurer has been obligated on bail bonds through the surety bondsman within the past three years.  The notice shall state the reasons, if any, for the termination.  Information furnished in the notice to the Commissioner shall be privileged and shall not be used as evidence in or basis for any action against the insurer or any of its representatives."
Sec. 16.  G.S. 58-71-140 reads as rewritten:
"§ 58-71-140.  Registration of licenses and power of appointments by insurers.
(a)	No professional bail bondsman shall become a surety on an undertaking unless he or she has registered his or her current license in the office of the clerk of superior court in the county in which he or she resides and a certified copy of the same with the clerk of superior court in any other county in which he or she shall write bail bonds.
(b)	A surety bondsman shall register his or her current surety bondsman's license and a certified copy of his or her power of appointment with the clerk of superior court in the county in which the surety bondsman resides and with the clerk of superior court in any other county in which the surety bondsman writes bail bonds on behalf of an insurer.
(c)	No runner shall become surety on an undertaking on behalf of a professional bondsman unless that runner has registered his or her current license and a certified copy of his or her power of attorney in the office of the clerk of superior court in the county in which the runner resides and with the clerk of superior court in any other county in which the runner writes bail bonds on behalf of the professional bondsman."
Sec. 17.  G.S. 58-33-25(e)(9) is repealed.
Sec. 18.  All surety bondsmen holding licenses issued under G.S. 58-33-25(e)(9) shall be issued surety bondsmen licenses under Article 71 of Chapter 58 of the General Statutes.
Sec. 19.  If any section or provision of this act is declared unconstitutional or invalid by the courts, it does not affect the validity of the act as a whole or any part other than the part so declared to be unconstitutional or invalid.
Sec. 20.  Sections 6 and 13 of this act become effective October 1, 1995.  Sections 1 through 5, 7 through 10, 12, and 14 through 18 of this act become effective January 1, 1996.  The remaining sections of this act are effective upon ratification.  Section 11.1 of this act expires January 1, 1996.