Aladdin Bail Bonds office in San Jose.
Aladdin Bail Bonds office in San Jose. Photo via

The California Department of Insurance issued a notice of noncompliance Tuesday to Carlsbad-based Seaview Insurance Co.

The agency charges the firm with failing to maintain eligibility guidelines for its surety line of insurance, resulting in possible discrimination to California consumers.

After conducting a regularly scheduled market conduct examination, CDI found that Seaview — the surety for Aladdin Bail Bonds, the largest bail bond company in the state — lacked specific guidelines for collateral requirements and lacked specific guidelines for down-payment of bond premium and payment plans.

“By not maintaining objective, specific eligibility guidelines, Seaview is allegedly in violation of the California Insurance Code and the California Code of Regulation,” according to a CDI statement. “This alleged violation results in an inability for applicants to receive equal access to a bail bond, creating the presumption that Seaview has applied rates that were excessive, inadequate and/or unfairly discriminatory.”

Seaview Insurance did not immediately respond to a request for comment on the notice of noncompliance, which requires the company to correct the alleged violations and provide proof of a systemwide correction within 10 days.

If the company fails to do so, CDI will set a public hearing that may result in penalties or corrective action deemed appropriate by the state insurance commissioner.

Last February, Insurance Commissioner Dave Jones prevailed in a suit brought by a bail agent challenging a regulation prohibiting bail agents from referring, suggesting or recommending an attorney to arrestees.

The court reasoned that the regulation, which dates back to the 1940s, “furthers important government interests in precluding overreaching and undue influence by bail agents in arrestees’ decisions about hiring an attorney, as well as in regulating the conduct of bail agents” who are licensed by the CDI.

In January 2017, Jones held a public hearing to examine the bail system in California and to hear from interested parties, including bail industry representatives, law enforcement, bail reform groups and other stakeholders regarding their perspectives on the current bail system and options for reform.

— City News Service