Lawsuit accuses Bad Boys of depositing bail for pushing co-signers into illegal loan agreements


Little did she know when Kiara Caldwell got her friend out of jail that it would turn into a year-long nightmare of incessant harassing phone calls, threats, and litigation.

Now she is fighting back.

The 31-year-old receptionist is suing the San Jose resident through a class action lawsuit filed in Alameda County this week Bad Boys Bail Bonds for locking people into illegal loan contracts that drown them in debt.

Elissa Della-Piana – Caldwell’s attorney and legal director of the Civil Rights Advocate Committee under the law Bay Area Chapter – The class action lawsuit has been named the first of its kind.

“We think this is the first consumer class action lawsuit against bad boys – or any other bond company in California,” she tells San Jose Inside. “We’ve represented so many individuals in bad boys cases, and we’ve just seen so many of them, that we thought class action would be the best approach.”

If a defendant cannot afford to be released, companies like Bad Boys offer to pay on their behalf for a non-refundable fee, usually around 10 percent of bail. Caldwell’s lawsuit, filed Tuesday, accuses the bail giant of violating consumer protection laws by deceiving co-signers for the full premium in “credit bail contracts” that require monthly payments.

Officials at Bad Boys Bail Bonds – a South Bay company founded in 1998 by C. Jeffrey Stanley, a former bounty hunter with a penchant for open faces Marketing Tactics– still have to send back several requests for comments.

If Caldwell had known what she was getting into, she would never have signed the contract Bad Boys put on in the hours after her friend was arrested on June 21, 2018.

Word is bond

The ordeal began when a bailiff called Caldwell about her close friend – someone she thought was a sister – who had been booked for shoplifting. Caldwell, a security guard who was taking classes at Chabot College at the time, says she was short of money.

But she says she knew her friend had no one to turn to.

So she showed up at the Bad Boys Bail Bonds Oakland branch to meet the guy who called her. The agent told Caldwell that authorities had set the friend’s bail at $ 5,000 and it would take him $ 1,000 to get her out from behind bars.

Caldwell offered to cough out what she could: $ 500. Since Bad Boys refused to pay by direct debit, the agent directed them to go down the street to get cash from an ATM.

The agent bombarded Caldwell with paperwork, she says, asking for information about her job, her family’s phone numbers, and the make and model of her car. With no experience of security deposits, Caldwell followed suit, although she said she felt rushed and just wanted to jump through hoops to free her friend.

“The whole thing took about 15 minutes from start to finish,” she says.

At no point did the bond agent declare Caldwell’s commitment to co-sign the full premium of $ 4,5,000 per complaint. She says she had no idea that the $ 500 was considered the first installment of a monthly payment plan.

When these payments came due, they said the collectors were tireless.

“They started making the calls all the time, calling my mom, calling my job, calling all the time,” said Cadlwell in a phone call. “Then I was sued, which bothered me even more. I didn’t, and still haven’t, had that kind of money to give them. If I had, I would have paid her just to go away. “

Many people who receive these phone calls end up feeling this way.

“These contracts are signed at the most vulnerable moments in people’s lives, when a loved one is imprisoned and, regardless of how important that person is to them, they are often breadwinners or child carers,” explains Della-Piana. “Leaving you in jail would have many dire effects. That’s a lot of pressure. And many people do not realize at this moment that they are running into debts that they cannot afford. “

A co-signer often only learns of his obligation when calling the debt collection agency, which Della-Piana claims to do around the clock and according to tactics that are expressly prohibited under consumer protection law. You call friends, family, and employers, she says. They threaten to chase people’s cars and houses.

“Then bad boys, along with other commercial bond companies, go after these debts,” she says. “They do this in a way that pretends to have the weight of the criminal justice system behind them. The threat implied is that if they don’t pay people will end up in jail, which results in people making incredible sacrifices in the rent, food, and health care costs their families need to survive. ”

Kiara Caldwell, 31, is suing Bad Boys.

Creditor reviews

Recognizing that consumer credit co-signers can be confused or misled about their obligations, California has implemented strict lender disclosure requirements.

According to BGB §. 1799.91, a company must inform co-signers of their liability under a loan agreement. The announcement must be made either directly to the place intended for your signature or on a separate sheet.

The law even mandates a specific language and font size for the notice, which must state that the co-signer should pledge the debt if the loan fails and should think carefully before assuming that responsibility.

The disclosure must alert the co-signer that they will also have to pay late fees or collection costs, that they risk litigation and wage garnishment, and that default on payment could become part of their creditworthiness.

If a creditor does not meet these transparency requirements, state law prohibits him from enforcing the contract at all.

The class action claim Caldwell requests, says Bad Boys, that these statutory disclosures have of course been avoided. And when these co-signers default on payments, the company often takes them to court.

They did that to Caldwell. Bad Boys sued Caldwell exactly a year ago, asking them to hand over the $ 4,500 in addition to late payment fees and other costs. However, the lawsuit gave her the decision to take the matter to court.

How many consumers fell victim to the scheme outlined in Caldwell’s case remains to be seen, but Della-Piana says she expects to find out from the electronic court records and Bad Boys Bail Bonds internal databases.

Anecdotally, she says she has reason to believe that the number of victims is several thousand and that the South Bay bailiff has been pushing people into legally dubious credit deals since at least 2015.

Della-Piana’s branch of the Civil Rights Lawyers’ Committee has for the past several years helped people enforce their loan agreements through a designated bond clinic. While existing consumer protection should prevent the type of fraud described in Caldwell’s case, among others, she hopes that state lawmakers would refine these laws by clarifying their application to the surety industry.

Fortunately, she says, a judge on the Contra Costa Superior Court set the laws applicable to commercial bail, which opened the door to a counterclaim against Bad Boys. A class action lawsuit, says Della-Piana, would simply apply that ruling more broadly.

Even if Californians end the cash deposit by passing through Prop. 25 On Nov. 3, Della-Piana says this won’t necessarily deter collectors from prosecuting co-signers for improper credit deals.

“Our fear is that with all this outstanding debt, these bond companies could accelerate their efforts to unlawfully collect it,” she says. “It is possible that they will make one last attempt to get as much money out of this industry as possible while they still can.”

Jennifer Wadsworth is the former news editor for San Jose Inside and Metro Silicon Valley. Follow her on Twitter below @jennwadsworth.


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