Gotham Gazette Gotham Gazette is an online publication covering New York policy and politics as well as news on public safety, transportation, education, finance and more. http://www.gothamgazette.com/component/tags/tag/department-of-financial-services 2017-10-18T07:19:38+00:00 Webmaster webmaster@gothamgazette.com Cuomo Proposed New Wall Street Regulation, But Left It Out of NYC Speech 2017-01-12T05:00:00+00:00 2017-01-12T05:00:00+00:00 http://www.gothamgazette.com/?id=6712:cuomo-proposes-new-wall-street-regulation-but-left-it-out-of-nyc-speech Ben Max <p><img src="http://www.gothamgazette.com/images/31402021033_c6100ba34a_z.jpg" alt="Cuomo state of the state new york city " width="600" height="400" /></p> <p dir="ltr">Gov. Cuomo (photo: The Governor's Office on flickr)</p> <hr /> <p>As part of his 2017 policy agenda, Governor Andrew Cuomo announced on Sunday a plan to ban bad actors from the financial services industry. Cuomo’s proposal would empower a state agency, the Department of Financial Services, with the authority to mete out such punishment to those deemed to have violated the public trust.</p> <p dir="ltr">However, when he <a href="http://www.gothamgazette.com/state/6705-speaking-directly-to-middle-class-anger-cuomo-offers-something-for-everyone" target="_blank">launched</a> his three-day, six-event State of the State tour in New York City on Monday morning, just a few blocks from Wall Street, home to the country’s financial industry giants, Cuomo made no mention of the proposal, which his Sunday press release said would ”better help prevent situations like the one seen recently at Wells Fargo.”</p> <p dir="ltr">Cuomo’s 2017 agenda has been defined by an overarching focus on addressing “middle class anger” stemming from economic anxiety and a lack of inclusion in the state’s overall economic recovery since the Great Recession. In his New York City speech he alluded to perpetrators whose behavior led to that economic downturn, Wall Street bankers and insurance companies responsible for the subprime mortgage crisis.</p> <p dir="ltr">“In the recession of 2007 the middle class saw their hard earned equity in their homes stolen,” Cuomo said from 1 World Trade Center. “Nearly half the homes of our middle class are not yet back to their pre-recession value. Just think of it. That home equity was their life’s work, their security blanket, the payment for their daughter’s wedding, it was their business loan, and their child’s college tuition. It was taken through no fault of their own. But they never got it back and no one even went to jail. Justice was never done. And that is not the American way.”</p> <p dir="ltr">The <a href="http://www.gothamgazette.com/state/6710-all-of-governor-cuomo-s-2017-state-of-the-state-proposals" target="_blank">sixth plank</a> from Cuomo’s 2017 policy agenda seeks to address that broader issue by giving the state Superintendent of Financial Services the ability to ban individuals from working in the banking and insurance industries in New York if they are found guilty of egregious wrongdoing.</p> <p dir="ltr">That the governor didn’t bring it up in his roughly 45-minute speech appears to be an odd omission, given the location of the speech and the fact that parts of it were specifically tailored to New York City. The governor’s entire 2017 agenda does contain 149 proposals, though only 19 had been made public by the end of his two speeches on Monday. Cuomo did not mention every region-specific proposal at its relevant stop on his tour. The governor’s office told Gotham Gazette there is nothing to the fact that Cuomo did not discuss the proposal during his New York City speech.</p> <p dir="ltr">“Under Governor Cuomo’s leadership, New York has made great strides in establishing a strong financial regulator and protecting consumers from unscrupulous practices,” said Abbey Fashouer, a spokesperson for the governor, in an email. “By banning bad actors from the financial services industry, we are taking another major step forward that will ensure that those who seek to defraud the hardworking people of New York are held accountable.”</p> <p dir="ltr">The proposal is indeed an aggressive move to regulate the financial services industry and would give the Department of Financial Services (DFS) powers that federal regulators currently possess, a move allowed under federal law. “There is no federal preemption issue,” Department of Financial Services Superintendent Maria Vullo told Gotham Gazette. “National banks and financial institutions must comply with New York State law. The proposal is a New York State statute that would authorize the Department of Financial Services to pursue individuals who commit bad acts that impact New Yorkers.”</p> <p dir="ltr">How the proposal will be received by state legislators and by those it seeks to regulate remains to be seen. The governor, in the announcement of the proposal, directly referred to the “excesses and systematic abuse” in the Wells Fargo case, where employees used customer information to create fake bank accounts and inflate their figures. A Wells Fargo spokesperson declined to comment on Cuomo’s proposal. Since the scandal broke in September, the bank has been attempting to make amends for its employees’ misdeeds. “We also recognize that aside from the financial impact, we’ve broken trust with some customers and...our priority is to restore trust with our customers,” Wells Fargo executive Justin Thornton told the <a href="http://www.wsj.com/articles/wells-fargo-is-trying-to-fix-its-rogue-account-scandal-one-grueling-case-at-a-time-1482855852" target="_blank">Wall Street Journal</a> in December.</p> <p dir="ltr">The governor’s proposal has not been fleshed out entirely and state legislative leaders have yet to weigh in. “We will review it once we see the language,” said Mike Whyland, spokesperson for Democratic Assembly Speaker Carl Heastie, in an email to Gotham Gazette. Republican Senate Majority Leader John Flanagan’s office did not respond to a request for comment.</p> <p dir="ltr">Cuomo’s proposal indicates a plan to expand financial services law, but without further clarity or bill language, legislators, industry representatives, advocacy groups, and others have little to go on.</p> <p dir="ltr">“The New York Insurance Association (NYIA) will be reviewing the proposal and considering whether or not the measures outlined are an appropriate approach,” said Ellen Melchionni, president of the insurance trade association, in a statement.</p> <p dir="ltr">Cuomo created the Department of Financial Services in 2011, shortly after taking office as governor, in order to create stronger oversight of the industry, which calls New York home. Since, DFS and other state entities, like the Attorney General’s office, have reached billions of dollars in settlements with financial institutions.</p> <p dir="ltr">Marcus Stanley, policy director for Americans for Financial Reform, a nonpartisan coalition that focuses on accountability in the industry, said the governor’s proposal was a “standard thing” for a state regulator. “I’m surprised they don’t have it already,” he said. He noted that despite numerous instances of misconduct over many years, federal regulators have tended not to use their power to ban individuals from the industry. “It’s a good thing for states to step into the gap,” he said. Although, he added, “It depends on whether they use [that power] and how they use it.”</p> <p>

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by Samar Khurshid, City government reporter, Gotham Gazette
     

Read more by this writer.

</p>
<p><img src="http://www.gothamgazette.com/images/31402021033_c6100ba34a_z.jpg" alt="Cuomo state of the state new york city " width="600" height="400" /></p> <p dir="ltr">Gov. Cuomo (photo: The Governor's Office on flickr)</p> <hr /> <p>As part of his 2017 policy agenda, Governor Andrew Cuomo announced on Sunday a plan to ban bad actors from the financial services industry. Cuomo’s proposal would empower a state agency, the Department of Financial Services, with the authority to mete out such punishment to those deemed to have violated the public trust.</p> <p dir="ltr">However, when he <a href="http://www.gothamgazette.com/state/6705-speaking-directly-to-middle-class-anger-cuomo-offers-something-for-everyone" target="_blank">launched</a> his three-day, six-event State of the State tour in New York City on Monday morning, just a few blocks from Wall Street, home to the country’s financial industry giants, Cuomo made no mention of the proposal, which his Sunday press release said would ”better help prevent situations like the one seen recently at Wells Fargo.”</p> <p dir="ltr">Cuomo’s 2017 agenda has been defined by an overarching focus on addressing “middle class anger” stemming from economic anxiety and a lack of inclusion in the state’s overall economic recovery since the Great Recession. In his New York City speech he alluded to perpetrators whose behavior led to that economic downturn, Wall Street bankers and insurance companies responsible for the subprime mortgage crisis.</p> <p dir="ltr">“In the recession of 2007 the middle class saw their hard earned equity in their homes stolen,” Cuomo said from 1 World Trade Center. “Nearly half the homes of our middle class are not yet back to their pre-recession value. Just think of it. That home equity was their life’s work, their security blanket, the payment for their daughter’s wedding, it was their business loan, and their child’s college tuition. It was taken through no fault of their own. But they never got it back and no one even went to jail. Justice was never done. And that is not the American way.”</p> <p dir="ltr">The <a href="http://www.gothamgazette.com/state/6710-all-of-governor-cuomo-s-2017-state-of-the-state-proposals" target="_blank">sixth plank</a> from Cuomo’s 2017 policy agenda seeks to address that broader issue by giving the state Superintendent of Financial Services the ability to ban individuals from working in the banking and insurance industries in New York if they are found guilty of egregious wrongdoing.</p> <p dir="ltr">That the governor didn’t bring it up in his roughly 45-minute speech appears to be an odd omission, given the location of the speech and the fact that parts of it were specifically tailored to New York City. The governor’s entire 2017 agenda does contain 149 proposals, though only 19 had been made public by the end of his two speeches on Monday. Cuomo did not mention every region-specific proposal at its relevant stop on his tour. The governor’s office told Gotham Gazette there is nothing to the fact that Cuomo did not discuss the proposal during his New York City speech.</p> <p dir="ltr">“Under Governor Cuomo’s leadership, New York has made great strides in establishing a strong financial regulator and protecting consumers from unscrupulous practices,” said Abbey Fashouer, a spokesperson for the governor, in an email. “By banning bad actors from the financial services industry, we are taking another major step forward that will ensure that those who seek to defraud the hardworking people of New York are held accountable.”</p> <p dir="ltr">The proposal is indeed an aggressive move to regulate the financial services industry and would give the Department of Financial Services (DFS) powers that federal regulators currently possess, a move allowed under federal law. “There is no federal preemption issue,” Department of Financial Services Superintendent Maria Vullo told Gotham Gazette. “National banks and financial institutions must comply with New York State law. The proposal is a New York State statute that would authorize the Department of Financial Services to pursue individuals who commit bad acts that impact New Yorkers.”</p> <p dir="ltr">How the proposal will be received by state legislators and by those it seeks to regulate remains to be seen. The governor, in the announcement of the proposal, directly referred to the “excesses and systematic abuse” in the Wells Fargo case, where employees used customer information to create fake bank accounts and inflate their figures. A Wells Fargo spokesperson declined to comment on Cuomo’s proposal. Since the scandal broke in September, the bank has been attempting to make amends for its employees’ misdeeds. “We also recognize that aside from the financial impact, we’ve broken trust with some customers and...our priority is to restore trust with our customers,” Wells Fargo executive Justin Thornton told the <a href="http://www.wsj.com/articles/wells-fargo-is-trying-to-fix-its-rogue-account-scandal-one-grueling-case-at-a-time-1482855852" target="_blank">Wall Street Journal</a> in December.</p> <p dir="ltr">The governor’s proposal has not been fleshed out entirely and state legislative leaders have yet to weigh in. “We will review it once we see the language,” said Mike Whyland, spokesperson for Democratic Assembly Speaker Carl Heastie, in an email to Gotham Gazette. Republican Senate Majority Leader John Flanagan’s office did not respond to a request for comment.</p> <p dir="ltr">Cuomo’s proposal indicates a plan to expand financial services law, but without further clarity or bill language, legislators, industry representatives, advocacy groups, and others have little to go on.</p> <p dir="ltr">“The New York Insurance Association (NYIA) will be reviewing the proposal and considering whether or not the measures outlined are an appropriate approach,” said Ellen Melchionni, president of the insurance trade association, in a statement.</p> <p dir="ltr">Cuomo created the Department of Financial Services in 2011, shortly after taking office as governor, in order to create stronger oversight of the industry, which calls New York home. Since, DFS and other state entities, like the Attorney General’s office, have reached billions of dollars in settlements with financial institutions.</p> <p dir="ltr">Marcus Stanley, policy director for Americans for Financial Reform, a nonpartisan coalition that focuses on accountability in the industry, said the governor’s proposal was a “standard thing” for a state regulator. “I’m surprised they don’t have it already,” he said. He noted that despite numerous instances of misconduct over many years, federal regulators have tended not to use their power to ban individuals from the industry. “It’s a good thing for states to step into the gap,” he said. Although, he added, “It depends on whether they use [that power] and how they use it.”</p> <p>

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by Samar Khurshid, City government reporter, Gotham Gazette
     

Read more by this writer.

</p>
Key to Vision of Closing Rikers, City Council Bail Fund Moves Through State Process 2016-03-03T21:28:32+00:00 2016-03-03T21:28:32+00:00 http://www.gothamgazette.com/?id=6206:key-to-vision-of-closing-rikers-city-council-bail-fund-moves-through-state-process kfan <p><img src="http://www.gothamgazette.com/images/graphics/2016/24339210493_21fa58928c_z.jpg" alt="MMV SOTC bail fund story" height="393" width="600" /></p> <p>Mark-Viverito delivers her State of the City (photo: William Alatriste)</p> <hr /> <p>Last year, New York City Council Speaker Melissa Mark-Viverito unveiled <a href="http://www.gothamgazette.com/index.php/government/5588-bronx-program-serves-as-inspiration-for-mark-viveritos-city-wide-bail-fund-proposal" target="_blank">her plan</a> for a fund that would cover bail for poor individuals charged with low-level criminal offenses who would otherwise be forced to wait in a city jail for their court date. The Council dedicated $1.4 million of budget funds to back the project, which is nearing launch.</p> <p>The program, if successful, could not only keep hundreds of individuals from staying in jail because they can't afford bail, but also lead to the expansion of state law that oversees and licenses bail funds, allowing for more criminal charges to be covered and higher bails paid.</p> <p>The Council bail fund is going through a fairly lengthy process to get up and running, with no clear start date more than a year after the initiative was announced. Mark-Viverito recently said she expects it to be functional in the coming months, but that the bureaucratic process of getting licensed by state overseers takes time. The fund has just been approved as a not-for-profit charity by the state attorney general's office, the second in four key steps. A heightened sense of urgency around the bail plan has emerged after Mark-Viverito <a href="http://www.gothamgazette.com/index.php/government/6164-mark-viverito-doubles-down-on-criminal-justice-reform-in-state-of-the-city" target="_blank">announced this year</a> that she hopes it will be a key element of actualizing "the dream" of closing Rikers Island jails.&nbsp;</p> <p>About 10,000 people are currently held in Rikers Island and other city jails, most awaiting a court appearance after being arrested for a low-level, non-violent offense. Some have been in jail for weeks or months because they can't afford bail and the criminal justice system moves at a snail's pace. It is a situation that many, including Mark-Viverito, have decried with increasing intensity over the past two years.</p> <p>"We need to take a comprehensive approach to criminal justice reform that ensures a fairer system, improves police community relations, and addresses the fact that far too many of our young people – mostly low-income black and Latino males – are locked up at Rikers," Mark-Viverito said during her 2015 State of the City address.</p> <p>She continued: "For instance, if you are accused of jumping a turnstile or committing other minor offenses in New York City, you may be locked up. And if you can't afford bail you will spend on average 15 days in jail. The results are predictable: people lose their jobs, or their housing, and cannot take care of their children while they are in custody. These are people who are accused of minor offenses and are still considered innocent in the eyes of the law. This is not justice."</p> <p>During this year's State of the City address, on Feb. 11, the speaker said that she wants to see "the population of Rikers to be so small that the dream of shutting it down becomes a reality." She announced a new criminal justice commission, led by former Chief Judge Jonathan Lippman, that will make recommendations for how to improve the criminal justice system.</p> <p>Last week while discussing her belief that Rikers Island should eventually be closed, Mark-Viverito cited her bail fund as something that will reduce the population over time. Asked when she expected the bail fund to start, Mark-Viverito said she is waiting to be licensed by the state.</p> <p>"We're waiting for the state, unfortunately, there's some state authorizations you need...some sort of licensure is needed," Mark-Viverito told reporters. "We needed, initially, a federal authorization, we've received that, we're waiting for the state, once that's done, we're ready to roll out. It's just we can't...without that authorization. So hopefully within the next months. It's just a normal process, obviously we are on top of it, but it's a normal process, it's bureaucratic."</p> <p>In follow-up conversation with Gotham Gazette, representatives of Mark-Viverito's office stressed the process is going well, is not an undue burden, and that the hope is to launch the program in a few months. The office said the process to incorporate the program began officially in July 2015. The first step involved registering as a non-profit on the federal level; the second, attorney general approval as a charity. With that second step complete, the application will go to the state Department of Financial Services, which licenses charitable bail funds.</p> <p>As approved by the AG, the fund shows "Initial directors" George McDonald, of The Doe Fund and David Howard, and Alphonso Wyatt, who were previously associated with the the fund. According to its bylaws, "The sole member of the Corporation shall be The Doe&nbsp;Fund, Inc., a New York not-for-profit corporation." McDonald is the founder and CEO of <a href="http://www.doe.org/" target="_blank">The Doe Fund</a>, which has worked for decades to employ, house, and train homeless New Yorkers to help them stabilize their lives.</p> <p>According to the filing, "the purpose" of the new organization will be "to assist indigent defendents charged with low-level crimes avoid the experience, complications and related hardships of pretrial detention caused by their inability to afford bail." Once it becomes a bail fund, it will "provide bail assistance" and "research, analyze and document the effectiveness and social impact of" its activities.</p> <p>Before 2012 Mark-Viverito's bail fund wouldn't have needed state approval because charitable bail funds operated in a legal gray area. That year, Bronx state Senator Gustavo Rivera successfully advocated for a state law to oversee bail funds after a judge ordered an organization in his district to stop covering bail.</p> <p>Now, as bail funds grow in popularity, Rivera said he is working with the state Department of Financial Services to smooth the application process and guide smaller groups that are interested in opening funds. Rivera said that as the evidence of the efficacy of such programs grows he hopes to expand the law that now only covers misdemeanor offenses and has a cap of $2,000 bail.</p> <p>Rivera was approached by the Bronx Defenders (a nonprofit legal defense group) in 2010 shortly after he defeated disgraced then-Sen. Pedro Espada for his seat. When the bill passed in 2012, the Bronx Freedom Fund became the state's first licensed charitable bail fund.</p> <p>Since then the group has shown promising results, <a href="http://www.gothamgazette.com/index.php/government/5588-bronx-program-serves-as-inspiration-for-mark-viveritos-city-wide-bail-fund-proposal" target="_blank">which Mark-Viverito and others have noticed</a>. It released a study last year showing that 97 percent of its clients returned to all their court appearances - some to more than 15 dates in a row. The group says that 27 times its bail money was returned even before the conclusion of a case. Out of 188 cases, 62 percent ended in a dismissal of all charges, 22 percent in a violation that carries no record, and 12 percent with a misdemeanor plea and no jail time.</p> <p>The fund has $100,000 to pay bail and it is periodically replenished when their clients fulfill their court obligations. Individuals are interviewed by the fund to determine their eligibility. Alyssa Work, former director of the Freedom Fund, told Gotham Gazette last year that the application process involved a defendant filling out a form, and her checking to see if they have family and community ties or steady employment. She also would evaluate their criminal record.</p> <p>Rivera has held a two roundtables on bail funds and has heard some concerns from interested groups. "We've been tweaking the paperwork you have to go through to get people licensed as bondsmen," said Rivera. "We've been discussing having the application fee waived for certain smaller organizations that aren't flush with cash, some folks have found it difficult to find someone at [Department of Financial Services] to answer questions. But the most important thing is that we've been working with DFS on this all along and they've been very helpful."</p> <p>Organizations wishing to start a bail fund have to complete four major steps: register as a non-profit under federal tax laws; register as a charity under New York State law through the AG's office; obtain a charitable bail license from the state DFS; and, finally, obtain an individual bail bond license from DFS.</p> <p>Mark-Viverito's office is now on to the third step.</p> <p>Obtaining a charitable bail organization license from DFS requires a detailed <a href="http://www.dfs.ny.gov/insurance/licensing/applications/cb_org.pdf" target="_blank">application</a>, a fee of $1,000, and the fingerprinting of all officers, directors, trustees, and executive personnel.</p> <p>Rivera said that while he intends to keep working with DFS on the application process, he does "hope to eventually introduce legislation that expands the legal parameters of bail funds." Rivera continued, "Right now the cap on bail is $2,000, we might want to move that. There is a small list of offenses currently covered and we may want to expand that list. We know we are helping people whose only crime is being poor, who can't afford bail, allowing them to be able to fight for their freedom, when they otherwise might be sitting in Rikers or somewhere else."</p> <p>In a statement to Gotham Gazette, Mark-Viverito said, "New York City is proud to lead the way in reforming a broken bail system that unjustly subjected our young people of color to senseless violence and abuse. By approaching this issue thoughtfully and deliberatively, we hope that our proposal for a citywide bail fund can serve as a model for other cities and municipalities seeking to change the way poverty and the criminal justice system intersect."</p> <p>Like Mark-Viverito, Sen. Rivera supports closing Rikers. Mayor Bill de Blasio called the idea&nbsp;"noble," but has said he doubts it is achievable. "My job is to level with the people of New York City," de Blasio recently told reporters. "This would cost billions and billions of dollars, be logistically very difficult, and we don't have the space right now."</p> <p>De Blasio has, however, also focused on bail reform, calling the current system unfair, with a burden that keeps the poor in jail for crimes they haven't been tried for, much less convicted of.</p> <p>De Blasio has a supervised release program scheduled to begin March 1. Funded by asset forfeiture funds from the Manhattan District Attorney's Office and the City Tax Levy, the program will provide judges with the option of sending those charged with misdemeanors or nonviolent felonies to supervised release programs overseen by agencies run in each of the five boroughs, rather than setting bail. The plan is expected to eventually serve 3,000 defendants.</p> <p>"There is a very real human cost to how our criminal justice system treats people while they wait for trial," de Blasio said <a href="http://www1.nyc.gov/office-of-the-mayor/news/471-15/mayor-de-blasio-17-8-million-reduce-unnecessary-jail-time-people-waiting-trial" target="_blank">in a July statement</a> announcing the program. "Money bail is a problem because – as the system currently operates in New York – some people are being detained based on the size of their bank account, not the risk they pose. This is unacceptable. If people can be safely supervised in the community, they should be allowed to remain there regardless of their ability to pay."</p> <p>

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by David King, Albany editor, Gotham Gazette
     

Read more by this writer.

</p>
<p><img src="http://www.gothamgazette.com/images/graphics/2016/24339210493_21fa58928c_z.jpg" alt="MMV SOTC bail fund story" height="393" width="600" /></p> <p>Mark-Viverito delivers her State of the City (photo: William Alatriste)</p> <hr /> <p>Last year, New York City Council Speaker Melissa Mark-Viverito unveiled <a href="http://www.gothamgazette.com/index.php/government/5588-bronx-program-serves-as-inspiration-for-mark-viveritos-city-wide-bail-fund-proposal" target="_blank">her plan</a> for a fund that would cover bail for poor individuals charged with low-level criminal offenses who would otherwise be forced to wait in a city jail for their court date. The Council dedicated $1.4 million of budget funds to back the project, which is nearing launch.</p> <p>The program, if successful, could not only keep hundreds of individuals from staying in jail because they can't afford bail, but also lead to the expansion of state law that oversees and licenses bail funds, allowing for more criminal charges to be covered and higher bails paid.</p> <p>The Council bail fund is going through a fairly lengthy process to get up and running, with no clear start date more than a year after the initiative was announced. Mark-Viverito recently said she expects it to be functional in the coming months, but that the bureaucratic process of getting licensed by state overseers takes time. The fund has just been approved as a not-for-profit charity by the state attorney general's office, the second in four key steps. A heightened sense of urgency around the bail plan has emerged after Mark-Viverito <a href="http://www.gothamgazette.com/index.php/government/6164-mark-viverito-doubles-down-on-criminal-justice-reform-in-state-of-the-city" target="_blank">announced this year</a> that she hopes it will be a key element of actualizing "the dream" of closing Rikers Island jails.&nbsp;</p> <p>About 10,000 people are currently held in Rikers Island and other city jails, most awaiting a court appearance after being arrested for a low-level, non-violent offense. Some have been in jail for weeks or months because they can't afford bail and the criminal justice system moves at a snail's pace. It is a situation that many, including Mark-Viverito, have decried with increasing intensity over the past two years.</p> <p>"We need to take a comprehensive approach to criminal justice reform that ensures a fairer system, improves police community relations, and addresses the fact that far too many of our young people – mostly low-income black and Latino males – are locked up at Rikers," Mark-Viverito said during her 2015 State of the City address.</p> <p>She continued: "For instance, if you are accused of jumping a turnstile or committing other minor offenses in New York City, you may be locked up. And if you can't afford bail you will spend on average 15 days in jail. The results are predictable: people lose their jobs, or their housing, and cannot take care of their children while they are in custody. These are people who are accused of minor offenses and are still considered innocent in the eyes of the law. This is not justice."</p> <p>During this year's State of the City address, on Feb. 11, the speaker said that she wants to see "the population of Rikers to be so small that the dream of shutting it down becomes a reality." She announced a new criminal justice commission, led by former Chief Judge Jonathan Lippman, that will make recommendations for how to improve the criminal justice system.</p> <p>Last week while discussing her belief that Rikers Island should eventually be closed, Mark-Viverito cited her bail fund as something that will reduce the population over time. Asked when she expected the bail fund to start, Mark-Viverito said she is waiting to be licensed by the state.</p> <p>"We're waiting for the state, unfortunately, there's some state authorizations you need...some sort of licensure is needed," Mark-Viverito told reporters. "We needed, initially, a federal authorization, we've received that, we're waiting for the state, once that's done, we're ready to roll out. It's just we can't...without that authorization. So hopefully within the next months. It's just a normal process, obviously we are on top of it, but it's a normal process, it's bureaucratic."</p> <p>In follow-up conversation with Gotham Gazette, representatives of Mark-Viverito's office stressed the process is going well, is not an undue burden, and that the hope is to launch the program in a few months. The office said the process to incorporate the program began officially in July 2015. The first step involved registering as a non-profit on the federal level; the second, attorney general approval as a charity. With that second step complete, the application will go to the state Department of Financial Services, which licenses charitable bail funds.</p> <p>As approved by the AG, the fund shows "Initial directors" George McDonald, of The Doe Fund and David Howard, and Alphonso Wyatt, who were previously associated with the the fund. According to its bylaws, "The sole member of the Corporation shall be The Doe&nbsp;Fund, Inc., a New York not-for-profit corporation." McDonald is the founder and CEO of <a href="http://www.doe.org/" target="_blank">The Doe Fund</a>, which has worked for decades to employ, house, and train homeless New Yorkers to help them stabilize their lives.</p> <p>According to the filing, "the purpose" of the new organization will be "to assist indigent defendents charged with low-level crimes avoid the experience, complications and related hardships of pretrial detention caused by their inability to afford bail." Once it becomes a bail fund, it will "provide bail assistance" and "research, analyze and document the effectiveness and social impact of" its activities.</p> <p>Before 2012 Mark-Viverito's bail fund wouldn't have needed state approval because charitable bail funds operated in a legal gray area. That year, Bronx state Senator Gustavo Rivera successfully advocated for a state law to oversee bail funds after a judge ordered an organization in his district to stop covering bail.</p> <p>Now, as bail funds grow in popularity, Rivera said he is working with the state Department of Financial Services to smooth the application process and guide smaller groups that are interested in opening funds. Rivera said that as the evidence of the efficacy of such programs grows he hopes to expand the law that now only covers misdemeanor offenses and has a cap of $2,000 bail.</p> <p>Rivera was approached by the Bronx Defenders (a nonprofit legal defense group) in 2010 shortly after he defeated disgraced then-Sen. Pedro Espada for his seat. When the bill passed in 2012, the Bronx Freedom Fund became the state's first licensed charitable bail fund.</p> <p>Since then the group has shown promising results, <a href="http://www.gothamgazette.com/index.php/government/5588-bronx-program-serves-as-inspiration-for-mark-viveritos-city-wide-bail-fund-proposal" target="_blank">which Mark-Viverito and others have noticed</a>. It released a study last year showing that 97 percent of its clients returned to all their court appearances - some to more than 15 dates in a row. The group says that 27 times its bail money was returned even before the conclusion of a case. Out of 188 cases, 62 percent ended in a dismissal of all charges, 22 percent in a violation that carries no record, and 12 percent with a misdemeanor plea and no jail time.</p> <p>The fund has $100,000 to pay bail and it is periodically replenished when their clients fulfill their court obligations. Individuals are interviewed by the fund to determine their eligibility. Alyssa Work, former director of the Freedom Fund, told Gotham Gazette last year that the application process involved a defendant filling out a form, and her checking to see if they have family and community ties or steady employment. She also would evaluate their criminal record.</p> <p>Rivera has held a two roundtables on bail funds and has heard some concerns from interested groups. "We've been tweaking the paperwork you have to go through to get people licensed as bondsmen," said Rivera. "We've been discussing having the application fee waived for certain smaller organizations that aren't flush with cash, some folks have found it difficult to find someone at [Department of Financial Services] to answer questions. But the most important thing is that we've been working with DFS on this all along and they've been very helpful."</p> <p>Organizations wishing to start a bail fund have to complete four major steps: register as a non-profit under federal tax laws; register as a charity under New York State law through the AG's office; obtain a charitable bail license from the state DFS; and, finally, obtain an individual bail bond license from DFS.</p> <p>Mark-Viverito's office is now on to the third step.</p> <p>Obtaining a charitable bail organization license from DFS requires a detailed <a href="http://www.dfs.ny.gov/insurance/licensing/applications/cb_org.pdf" target="_blank">application</a>, a fee of $1,000, and the fingerprinting of all officers, directors, trustees, and executive personnel.</p> <p>Rivera said that while he intends to keep working with DFS on the application process, he does "hope to eventually introduce legislation that expands the legal parameters of bail funds." Rivera continued, "Right now the cap on bail is $2,000, we might want to move that. There is a small list of offenses currently covered and we may want to expand that list. We know we are helping people whose only crime is being poor, who can't afford bail, allowing them to be able to fight for their freedom, when they otherwise might be sitting in Rikers or somewhere else."</p> <p>In a statement to Gotham Gazette, Mark-Viverito said, "New York City is proud to lead the way in reforming a broken bail system that unjustly subjected our young people of color to senseless violence and abuse. By approaching this issue thoughtfully and deliberatively, we hope that our proposal for a citywide bail fund can serve as a model for other cities and municipalities seeking to change the way poverty and the criminal justice system intersect."</p> <p>Like Mark-Viverito, Sen. Rivera supports closing Rikers. Mayor Bill de Blasio called the idea&nbsp;"noble," but has said he doubts it is achievable. "My job is to level with the people of New York City," de Blasio recently told reporters. "This would cost billions and billions of dollars, be logistically very difficult, and we don't have the space right now."</p> <p>De Blasio has, however, also focused on bail reform, calling the current system unfair, with a burden that keeps the poor in jail for crimes they haven't been tried for, much less convicted of.</p> <p>De Blasio has a supervised release program scheduled to begin March 1. Funded by asset forfeiture funds from the Manhattan District Attorney's Office and the City Tax Levy, the program will provide judges with the option of sending those charged with misdemeanors or nonviolent felonies to supervised release programs overseen by agencies run in each of the five boroughs, rather than setting bail. The plan is expected to eventually serve 3,000 defendants.</p> <p>"There is a very real human cost to how our criminal justice system treats people while they wait for trial," de Blasio said <a href="http://www1.nyc.gov/office-of-the-mayor/news/471-15/mayor-de-blasio-17-8-million-reduce-unnecessary-jail-time-people-waiting-trial" target="_blank">in a July statement</a> announcing the program. "Money bail is a problem because – as the system currently operates in New York – some people are being detained based on the size of their bank account, not the risk they pose. This is unacceptable. If people can be safely supervised in the community, they should be allowed to remain there regardless of their ability to pay."</p> <p>

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by David King, Albany editor, Gotham Gazette
     

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