Grand jury indicts bail bondsman

PALMER -- A former Wasilla bail bondsman faces 60 felony counts for allegedly overcharging dozens of customers in violation of state law.

A grand jury in Palmer returned the indictment again John S. Elder on Sept. 25. It charges him with theft, fraudulent insurance acts, falsifying business records and other crimes from May 2000 to July 2002 while employed by Alaska Bail Bonds.

Elder, now 28, received illegal premium payments totaling $35,530, according to the charging document filed in Palmer District Court by Alaska Assistant Attorney General Kevin Burke.

The state Division of Insurance issued Elder an "individual in the firm" insurance license with the Wasilla firm, meaning he was an employee of Alaska Bail Bonds and was obligated to report all sales to them.

He also was obligated as their employee to take only a 35-percent commission from the 15-percent premium the company collected on a bond. Alaska Bail Bonds is appointed with Ranger Insurance Co., which is authorized by the Division of Insurance to collect no more than 15 percent of a bail amount set by court, Burke said.

He contends Elder tried to skirt that provision by failing to report additional fees he arbitrarily placed on transactions. In one case, charging documents say Elder obtained a vehicle valued at $6,995 as payment in lieu of a $2,500 fee "of which he never remitted any payments to Alaska Bail Bonds and/or Ranger Insurance Company."

The state's investigation began in July 2002 when the Division of Insurance received a complaint from Larry Hartley, who said he'd been overcharged by Elder for a bail bond. Hartley's bail was set at $8,500, which would have required a $1,275 bail bond payment at the 15 percent rate.

He was unable to pay the full amount the day he called Elder, the charging document says, but Hartley paid the bondsman $700 -- leaving an unpaid balance of $575.

"When he later paid Elder $500, Elder informed him that he owed an additional $250," Burke wrote in the document. "Elder stated that this additional amount was because Elder allowed him to get out of jail prior to the entire amount being paid.

"Elder then attempted to get Hartley to place his van as collateral. Hartley could not use his van as collateral because of a lien by the bank, and Elder informed him that he would need to pay an additional $800 for 'insurance on the bond.'"

Burke said there is no such thing as "insurance on the bond."

In June 2002, Rose M. Jackson wrote a letter to Alaska Bail Bonds owner Arelia Gomez stating she paid an initial bond of $375 in cash to Elder for the bail and release of Grace Magness. She said Elder told her she had one week to deposit an additional $250 into a First National Bank of Alaska account or Magness would immediately go back to jail.

Elder said he would refund the $250 when Magness appeared in court, and Jackson complied with his directions, charging documents said. After the appearance, Jackson asked Elder when the money would be refunded and he said he didn't owe her anything, documents said.

An investigator mailed letters to 147 of Elder's clients asking about their experience with the bondsman. Some of the letters were returned by the U.S. Postal Service, but 36 people responded. Of those, Burke said, 35 indicated Elder charged them more than the allowable 15 percent premium and provided receipts reflecting the overcharge.

The investigation determined that 55 clients paid Elder $17,460 more than the authorized 15 percent premium, Burke said. In addition, Elder collected $10,875 in premiums that were never reported to his company, Burke said.