If you got arrested, could you come up with the bail needed to buy your immediate freedom?
For most people, the answer is no. Even though those arrested haven’t been convicted of a crime, the only way for them to get out of jail while they await their day in court is to come up with an alternative source of money. Enter big insurance companies like Lexington National. They’ll get you out, but you have to pay them a fee that you’ll never get back, which guarantees them a hefty profit regardless of the outcome of the case.
If you think this is corporate greed run amok, you aren’t alone. The legal right to turn a profit on bail is a rare phenomenon globally: It's only legal in the U.S. and the Philippines. And for good reason.
After all, the people accused of a crime — and their families desperate to have them home — are hardly in a position to bargain. Since they run the risk of losing their job or home, the accused are at the mercy of bail bond companies, which have a huge amount of leverage over people who sign their exploitative contracts. That’s why bail contracts often contain terms like installment plans and high interest rates that lead to years of debt.
These contracts might even allow a bail bond agent to return a person to jail simply because their collateral loses value — after, for example, a car crash or a house fire — or because they got a new phone number without immediately notifying the insurance agent. These contracts often also allow bond companies to follow their “clients” and to demand detailed information about their lives — like where they go, who they see, and when they get a new job — or to search their family’s property at any time without notice or a warrant.
And no matter what happens, the person who entered into a bail bond contract — often a mom, wife, sister, or other female family member — is on the hook to pay. Even if a person does everything he is required to, and even if he is eventually found not guilty, he’s paying the company’s fee.
These “bail sharks” have a pretty sweet deal, altogether raking in about $2 billion a year. And because these companies are so profitable, they are able to pour money into state-level candidates, committees, parties, and ballot measures to push back against the growing national momentum for bail reform. For example, Lexington National is working in states across the country to fight reforms that threaten their profits. They even went so far as to sue New Jersey after the state overhauled its money bail system.
Last year, the Garden State moved to a system that no longer relies so heavily on money bail. Before the change, it was common for people who could not afford to pay bail to be jailed awaiting trial for months. The average wait was a whopping 10 months.
Courts in the state now rarely set money bail, instead allowing most people to return home. The number of people locked up in the state’s jails awaiting trial has plummeted, and people are showing up to court as required. Reform is working for the people of New Jersey.
Lexington National isn’t so pleased, however. They are suing the state to bring back money bail. It’s not hard to guess why. Lexington National filed suit, arguing that there is a constitutional right to money bail. They do not argue that more people should be released before trial. Rather, they contend that people should have the right to pay cash bail to secure their release. Put simply, Lexington National wants to preserve the bail system to protect its bottom line.
New Jersey provides an example of a successful alternative to relying so heavily on money bail. That threatens the industry’s profits, not just there, but in all the other states considering making the same move away from money bail.
Litigation isn’t the only way Lexington National tries to subvert bail reform.
In Maryland, the company donated thousands of dollars since 2011 to the chairs of legislative committees that oversee legislation that would impact the state’s bail bond industry as well as other legislators during the election cycle. In 2014, it contributed to a failed campaign effort in California to keep penalties — and therefore bail amounts — high for low-level property and drug crimes. These investments give Lexington the opportunity to try to exert their influence over lawmakers who are actively considering reforms to the bail system.
And when they win, communities of color lose. Companies like Lexington National prey upon communities already targeted by the criminal justice system. Black people are more likely to be arrested because of over-policing, more likely to be assigned cash bail than white people arrested for similar crimes, and more likely to have a higher bail amount set.
Because cash bail disproportionately impacts Black communities, bail bond companies exert a huge amount of influence over their freedom and sap community resources. In 2015, for example, approximately 4,900 families in New Orleans paid $4.7 million in nonrefundable premiums to for-profit bail companies like Lexington National. Eighty-four percent of the bail premiums and associated fees were paid by Black residents.
We’ll continue to regularly highlight bail sharks like Lexington National to emphasize just how broken our money bail system really is. If the same companies that profit off of the status quo are influencing the lawmakers who could pass meaningful reforms, our bail system will continue to exploit vulnerable communities, especially communities of color, and fuel mass incarceration.
In 2018, states across the country will consider pursuing meaningful reforms to their money bail system. But by shining a light on the predatory activities of bail sharks, we have a chance to fight back and secure the smart justice reforms our country deserves.