AB 773, as introduced, Hueso. Bail agent licenses: qualifications.
Existing law requires a license from the Insurance Commissioner for advertising or holding oneself out as engaging in the business of executing, delivering, or furnishing bail bonds or undertakings of bail whether or not for consideration. A license may be held by a corporation if certain requirements are met, including, but not limited to, that 100% of the shares of the corporation are held by licensed bail agents, and all shareholders, officers, and directors of the corporation are licensed bail agents. A violation of any of these provisions is a crime.
This bill would authorize a limited liability company (LLC) to be a licensee subject to the same requirements as corporations. The bill would also exempt a corporation or a LLC from the requirements that 100% of the shares of the corporation or membership interest in the LLC be held by licensed bail agents, and all shareholders, officers, and directors of the corporation or members of the LLC be licensed bail agents, if the corporation or LLC is an admitted surety insurer or a subsidiary of an admitted surety insurer. Because a violation of the bill’s provisions by an LLC would be a crime, the bill would impose a state-mandated local program.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.
Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes.
The people of the State of California do enact as follows:
Section 1810 of the Insurance Code is amended
2to read:
(a) Natural personsbegin delete canend deletebegin insert mayend insert be licensed under this
4chapter.
5(b) A license may be held by a corporationbegin insert or a limited liability
6company (LLC)end insert, in which case all of the following requirements
7shall be met:
8(1) The application shall set forth the names of all officers and
9employees of the licensee who will be authorized to exercise the
10powers of the licensee under this
chapter. Each of those persons
11shall be required to meet the requirements for licensure under this
12chapter, and disciplinary action may be taken against any of those
13persons, and the licensee, if any of those persons does any act that
14would be grounds for disciplinary action against a licensee.
15(2) The corporationbegin insert or LLCend insert may solicit or negotiate the
16execution or delivery of bail on behalf of surety insurers only
17through natural persons who hold individual licenses as bail agents.
18(3) One hundred percent of the shares of the corporationbegin insert or
19membership interest in the LLCend insert shall be held by licensed bail
20agentsbegin insert,
unless the corporation or LLC is an admitted surety insurer
21or is a subsidiary of an admitted surety insurerend insert.
22(4) All shareholders, officers, and directors of the corporation
23begin insert or members of the LLCend insert shall be licensed bail agents, and shall be
24disclosed to the departmentbegin insert, unless the corporation or LLC is an
25admitted surety insurer or is a subsidiary of an admitted surety
26insurerend insert.
27(5) Any sale or transfer of stock or other interest in the
28corporationbegin insert or sale or transfer of any membership or other interest
29in the LLCend insert shall require the prior
approval of the department. The
P3 1department shall approve or disapprove a request for approval
2within 60 days of receiving the completed request.
No reimbursement is required by this act pursuant to
4Section 6 of Article XIII B of the California Constitution because
5the only costs that may be incurred by a local agency or school
6district will be incurred because this act creates a new crime or
7infraction, eliminates a crime or infraction, or changes the penalty
8for a crime or infraction, within the meaning of Section 17556 of
9the Government Code, or changes the definition of a crime within
10the meaning of Section 6 of Article XIII B of the California
11Constitution.
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