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A07770 Summary:

BILL NOA07770C
 
SAME ASSAME AS S07475-B
 
SPONSOREpstein
 
COSPNSRTaylor, Richardson, Quart, Seawright, Kelles, Gonzalez-Rojas, Cruz, Forrest, Gottfried, Simon, Reyes, Burgos, Jackson, Meeks, Steck, Tapia, Ramos, Fernandez, Aubry, Gibbs, Solages, Weprin, Fahy, Niou, Rivera JD, Rosenthal L, Thiele, Benedetto, Otis
 
MLTSPNSRCook
 
Add §§1123, 2140 & 2312, Ins L
 
Provides for regulating immigration bail businesses including restrictions on who may operate such a business; provides for who may bring an action against an immigration bail business.
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A07770 Actions:

BILL NOA07770C
 
05/21/2021referred to insurance
10/20/2021amend and recommit to insurance
10/20/2021print number 7770a
01/05/2022referred to insurance
05/04/2022reported referred to codes
05/11/2022amend (t) and recommit to codes
05/11/2022print number 7770b
05/17/2022amend and recommit to codes
05/17/2022print number 7770c
05/23/2022reported referred to ways and means
05/25/2022reported referred to rules
05/31/2022reported
05/31/2022rules report cal.454
05/31/2022ordered to third reading rules cal.454
06/03/2022substituted by s7475b
 S07475 AMEND=B BAILEY
 10/27/2021REFERRED TO RULES
 01/05/2022REFERRED TO INSURANCE
 05/11/2022AMEND (T) AND RECOMMIT TO INSURANCE
 05/11/2022PRINT NUMBER 7475A
 05/17/2022AMEND AND RECOMMIT TO INSURANCE
 05/17/2022PRINT NUMBER 7475B
 06/01/2022COMMITTEE DISCHARGED AND COMMITTED TO RULES
 06/01/2022ORDERED TO THIRD READING CAL.1808
 06/01/2022PASSED SENATE
 06/01/2022DELIVERED TO ASSEMBLY
 06/01/2022referred to ways and means
 06/03/2022substituted for a7770c
 06/03/2022ordered to third reading rules cal.454
 06/03/2022passed assembly
 06/03/2022returned to senate
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A07770 Memo:

NEW YORK STATE ASSEMBLY
MEMORANDUM IN SUPPORT OF LEGISLATION
submitted in accordance with Assembly Rule III, Sec 1(f)
 
BILL NUMBER: A7770C
 
SPONSOR: Epstein
  TITLE OF BILL: An act to amend the insurance law, in relation to an immigration bail business   PURPOSE OR GENERAL IDEA OF BILL: This bill increases oversight of the immigration bond industry and curbs abusive practices.   SUMMARY OF PROVISIONS: Section 1 amends the insurance law by adding a new section 1123 that defines an immigration bail business, and restricting the doing of an immigration bond business to those authorized to do so by this article and in compliance with the requirements of this article. Section 2 amends the insurance law by adding a new section 2140 imposing certain restrictions on the doing of an immigration bail business in the state. It prohibits immigration bond businesses from requiring electron- ic monitoring as a condition of an immigration bail and requires immi- gration bond companies to disclose the sources of funding for lawyers to which they refer immigration bail clients and inform immigration bail clients that they have a right to choose their own legal counsel. Section 3 amends the insurance law by adding a new section 2313 that establishes a cap on immigration bond premiums. Section 4 provides for the severability of any clause found to be inval- id. Section 5 directs the superintendent to promulgate regulations imple- menting this act, and provides the effective date.   JUSTIFICATION: The scope of immigrant detention is massive. Across the country, more than 25,000 immigrants were booked into detention in the first three months of 2021 and there are nearly 14,000 in detention on a daily basis. Hundreds of immigrant New Yorkers are detained in as many as 76 different detention facilities across the state. In New York the median dollar amount of bonds granted in immigration cases is $7,500, one of the highest in the country. This is 50 percent higher than the median bail set in felony criminal cases in New York City and nearly seven times more than in non-felony cases. Unlike defendants in criminal court, immigrants in detention must either put up their entire bond in cash, or turn to "surety bonds," which require the detained immigrant to pay a surety or bond company a non-refundable percentage of the bond amount (usually 15-20%). Many immigrants who cannot afford a cash bond turn to immigration bond companies for a surety bond, driving rapid growth in the immigration bond sector in recent years. One of the most serious concerns about the for-profit immigration bond sector is excessive fees. Clients of for-profit immigration bond compa- nies must pay thousands of dollars up front and pay hundreds of dollars more in fees every month. Over time, these payments can exceed the cost of the initial bond. And unlike cash bonds, none of these payments are refundable--a fact that many clients of for-profit immigration bond companies do not understand until it is too late. Clients of for-profit immigration bond companies have reported that they did not understand the contracts they entered into, that contract documents were not trans- lated into their language, and that they were led to believe fees they paid to immigration bond companies were refundable. Clients have also reported that they were falsely informed they could be deported or returned to detention if they failed to make payments to immigration bond companies. For-profit immigration bond companies charge bailees as much as $420 each month as "operating fees" on the electronic ankle monitors it requires them to wear. The actual cost of operating these devices has been estimated in court documents as $120 per month, which means that these companies are making mandatory rent paid by detained immigrants on their own ankle shackles into a profit center. Because the average wait time in New York State immigration courts is over 2 years, detained immigrants may end up paying over $10,000 in fees for ankle monitoring fees alone. Again, these fees are not refundable, even if the immigrant prevails in. court. Some clients of for-profit immigration bond companies have reported that they experienced serious medical conditions related to their ankle monitors, that they were told they had to keep the ankle shackle on even during a pregnancy, and that they were told that they would have to pay $4,000 in fees (several times the actual cost of the device) if the device were lost or damaged, including being cut off by medical personnel. Of further concern, for-profit immigration bond companies have been known to refer clients to "pro bono" law practices affiliated with the company that provide free legal representation in immigration proceedings. While the these arrangements can appear purely charitable, they create a significant risk of legal conflict of interest, in which immigration attorneys funded by immigration bond company may have an incentive to act in the best interests of the company rather than their clients. This modest legislation would bring badly needed oversight to a sector in which companies may be operating as unlicensed insurance agents and which is rife with abuses by licensing and regulating immigration bond businesses, reining in inflated fees, requiring more transparency in contracts, and curbing the abusive practice of charging immigration bond clients for their own electronic ankle shackles.   PRIOR LEGISLATIVE HISTORY: 2020: A8450/S6521 - referred to economic development / REFERRED TO CONSUMER PROTECTION 2019: A8450/S6521 - referred to economic development / REFERRED TO RULES   FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS: Unknown.   EFFECTIVE DATE: 60 days after becoming law.
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A07770 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                         7770--C
 
                               2021-2022 Regular Sessions
 
                   IN ASSEMBLY
 
                                      May 21, 2021
                                       ___________
 
        Introduced by M. of A. EPSTEIN, TAYLOR, QUART, SEAWRIGHT, KELLES, GONZA-
          LEZ-ROJAS,  CRUZ,  FORREST,  GOTTFRIED, SIMON, REYES, BURGOS, JACKSON,
          MEEKS, STECK, TAPIA, RAMOS, FERNANDEZ, AUBRY, GIBBS,  SOLAGES,  WEPRIN
          --  Multi-Sponsored  by  -- M. of A. COOK -- read once and referred to
          the Committee on Insurance  --  committee  discharged,  bill  amended,
          ordered  reprinted  as  amended  and  recommitted to said committee --
          recommitted to the Committee on Insurance in accordance with  Assembly
          Rule  3,  sec. 2 -- reported and referred to the Committee on Codes --
          committee discharged, bill amended, ordered reprinted as  amended  and
          recommitted  to  said  committee -- again reported from said committee
          with amendments, ordered reprinted as amended and recommitted to  said
          committee
 
        AN  ACT  to  amend the insurance law, in relation to an immigration bail
          business
 
          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:
 
     1    Section  1.  The insurance law is amended by adding a new section 1123
     2  to read as follows:
     3    § 1123. Immigration bail business. (a)(1)  Any  person,  firm,  corpo-
     4  ration,  or other entity who shall for another deposit money or property
     5  as bail or execute as surety any  bond  in  any  immigration  action  or
     6  proceeding  who  within  a  period of one month prior thereto shall have
     7  made such a deposit or given such bail in more than two cases not  aris-
     8  ing  out  of  the  same transaction shall be deemed to be doing an immi-
     9  gration bail business.
    10    (2) Except for a corporation authorized to write fidelity  and  surety
    11  insurance  and  to  do  an  immigration  bail  business  pursuant to the
    12  provisions of this article and otherwise in compliance  with  all  other
    13  requirements  of  this  chapter  to  do  such business, no person, firm,
    14  corporation, or other entity shall engage in an immigration  bail  busi-
    15  ness in this state.
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD09647-09-2

        A. 7770--C                          2
 
     1    (b)  (1)  No  person, firm, corporation, or other entity shall in this
     2  state do an insurance  business  or  an  immigration  bail  business  as
     3  defined in subsection (a) of this section unless authorized by a license
     4  issued and in force as provided under this article.
     5    (2)  The  superintendent  may  authorize a property/casualty insurance
     6  company that is authorized to write fidelity and surety insurance to  do
     7  an  immigration  bail business in accordance with the provisions of this
     8  article, but no individual or entity shall be licensed to do such  busi-
     9  ness.
    10    (c)  Any person, firm, corporation, or other entity that violates this
    11  section shall be subject to the penalty set forth in subsection  (a)  of
    12  section one thousand one hundred two of this article.
    13    (d)  Any  agreement  entered into by an entity subject to this section
    14  that is not authorized to do an immigration bail business in  accordance
    15  with the provisions of this article shall be void and unenforceable.
    16    §  2.    The  insurance law is amended by adding a new section 2140 to
    17  read as follows:
    18    § 2140. Restrictions  on  insurance  producers  procuring  immigration
    19  bonds.  (a) No insurance producer shall require the use of an electronic
    20  monitoring device as a condition of immigration bail. For  the  purposes
    21  of  this  section, an "electronic monitoring device" includes any device
    22  that tracks or monitors location, any device  that  tracks  or  monitors
    23  biometric  data,  or any device that records or transmits video or audio
    24  surveillance data.
    25    (b) No insurance producer shall make a referral to or provide  contact
    26  information for a legal services provider without:
    27    (1)  disclosing  in writing, in a language understood by the consumer,
    28  whether the insurance producer or an entity that is an affiliate of  the
    29  insurance  producer:  (A)  has  a financial or ownership interest in the
    30  legal services provider;  (B)  is  receiving  any  compensation,  either
    31  directly  or  indirectly,  for making a referral to or providing contact
    32  information for the legal services provider;  or  (C)  is  compensating,
    33  either directly or indirectly, the legal services provider for the legal
    34  services rendered; and
    35    (2)  stating  that: "The payment of premiums to the insurance producer
    36  is not for and does not guarantee that you will receive legal  represen-
    37  tation.    Using  this  legal  services provider is not a requirement of
    38  bail. If you choose to hire this legal services provider, you  have  the
    39  right to fire the provider at any time and retain your own counsel."
    40    (c)  Any  agreement,  or  portion  thereof, entered into requiring the
    41  waiving of the requirements of this section or otherwise in violation of
    42  this section shall be void and unenforceable.
    43    § 3. The insurance law is amended by adding a new section 2312 to read
    44  as follows:
    45    § 2312. Immigration bond premium. (a) The premium for giving an  immi-
    46  gration  bond or depositing money or property as immigration bail in any
    47  court having immigration jurisdiction or in any  immigration  action  or
    48  proceeding shall not exceed ten per centum of the amount of such bond or
    49  deposit in actions where such bonds or deposits do not exceed the sum of
    50  three  thousand dollars.  Where such bonds or deposits exceed the sum of
    51  three thousand dollars, the premium shall not exceed ten per  centum  of
    52  the  first  three  thousand  dollars  and eight per centum of the excess
    53  amount over three thousand dollars up to ten thousand  dollars  and  six
    54  per centum of the excess amount over ten thousand dollars.
    55    (b) No person, firm, corporation, or other entity, including an insur-
    56  ance producer, shall:

        A. 7770--C                          3
 
     1    (1)  charge,  collect,  or receive, directly or indirectly, any fee or
     2  compensation in connection with an immigration  bail  deposit  or  immi-
     3  gration bond, other than the premium based on rates subject to the maxi-
     4  mum  specified  in  subsection  (a)  of  this section and filed with the
     5  superintendent  by the insurer pursuant to this article, notwithstanding
     6  subsection (c) of section two thousand  one  hundred  nineteen  of  this
     7  chapter; or
     8    (2)  accept  any  fee  or  compensation for obtaining a license or for
     9  obtaining an insurance producer or immigration  bond  or  for  an  immi-
    10  gration bail deposit.
    11    (c)  Any person, firm, corporation, or other entity that violates this
    12  section shall be guilty of a misdemeanor.  An indemnitor may maintain  a
    13  cause of action in a court of competent jurisdiction against any person,
    14  firm, corporation, or other entity to recover any fee or compensation in
    15  excess  of  the  amount authorized pursuant to this section. The person,
    16  firm, corporation, or other entity shall, in any action  brought  by  an
    17  indemnitor to recover any such overcharge, be liable for treble damages.
    18    (d)  Any  agreement,  or  portion  thereof, entered into requiring the
    19  waiving of the requirements of this section or otherwise in violation of
    20  this section shall be void and unenforceable.
    21    §  4.  Severability  clause.  If  any  clause,  sentence,   paragraph,
    22  subsection,  section  or part of this act shall be adjudged by any court
    23  of competent jurisdiction to be invalid, such judgment shall not affect,
    24  impair, or invalidate the remainder thereof, but shall  be  confined  in
    25  its operation to the clause, sentence, paragraph, subsection, section or
    26  part thereof directly involved in the controversy in which such judgment
    27  shall  have been rendered. It is hereby declared to be the intent of the
    28  legislature that this act would have been enacted even if  such  invalid
    29  provisions had not been included herein.
    30    §  5.  This  act  shall take effect on the sixtieth day after it shall
    31  have become a law.    Effective  immediately,  the  addition,  amendment
    32  and/or repeal of any rule or regulation necessary for the implementation
    33  of  this  act  on  its  effective  date  are  authorized  to be made and
    34  completed on or before such effective date.
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