Hacker News Reader

Comment by c22 | Hacker News Reader

This is, in fact, how bail works. But you can often get a bail bond (from a third party) for 10%-20% of the bail amount.

View on HN

But that 10% is a non-recoverable fee, right? It seems insane they would have agreed to pay a third party $25M as a non-recoverable fee.

They will likely not being using a bondsman. They are probably paying the bond (ostensibly) themselves. They are taking a $250m loan using their house as collateral. If SBF does not make it to court on the agreed date, his parents will lose their house and be on the hook for the rest of the loan. If he does, his parents get the $250 million back and can pay off the loan. Until then, they are likely just making interest payments.

You can think of bondsmen as essentially very specialized financial institutions. They provide loans to people. If you have a $5000 bond, you can pay a bondsman $500 to front the other $4500 for you. If you make it to court, they get their $4500 back and it's all good. If you don't make it to court, they are incentivized to find you to make sure you make it to court. They are usually not pleased to do this.

You are not required to use a bail bondsman to post bail.

They are making interest payments on 250 million USD? Wow! How much do these people earn?

Stanford professors make around $180k usually. There's no chance they're paying regular interest of a 250m loan without some financial support.

> Stanford professors make around $180k usually. There's no chance they're paying regular interest of a 250m loan without some financial support.

There is no $250M loan. Should he fail to appear, he and each of his sureties (his parents) can be pursued by the court for whatever remains of the balance of the $250M bail amount.

There is no actual $250M that changes hands until then (or, realistically, after.)

The actual order: https://www.courtlistener.com/docket/66631291/14/united-stat...

So much consternation about where the money came from and all anybody has to do is read the court order.

Yes. I doubt they did this.

I thought it was only if you skip town

Not quite. You pay a bondsman 10%. The bondsman turns around and pays the full bail amount to the court. If you show up, the bondsman gets their money back from the court but keeps your 10% as a fee. If you don't show up to court, the bondsman does not get their money back and is left holding the bag for the other 90% of the bail amount.

What professor has $25M lying around to pay the bond? Yes, Palo Alto homes are expensive, but those are not typically the homes professors are living in.

Their house is valued at $4m on Stanfords campus, fwiw.

What bondsman has $250 million in the bank to do this? Seems like such an obscure niche to be in.

I doubt they used a bondsman. $25 million is a pretty steep fee. They likely paid the entire bail amount and will get that money back once SBF shows up to court.

That kind of money could still save about 5000 lives from malaria, according to GiveWell.

When push comes to shove, morals aren't easy to come by. Especially not when put up against some downtime with the family.

That is if you have no collateral to back it up

If you skip town, you lose the whole bond.

If you use a bondsman, you lose the 10% no matter what. If you use a bondsman and skip town, you're out 10%, and they're out the other 90%. Hence why bondsmen employ bounty hunters.

That’s how you get out on a DUI. A property bond is different.

There’s no way his parents are forking over their home to a bails bondsmen. There’s also no bail bond man who has $250m.

> But you can often get a bail bond (from a third party) for 10%-20% of the bail amount.

In most states, 10% is closer the legal maximum than the minimum premium for a bail bond (it is often exactly the the legal maximum, but in NY the maximum for large bail amounts is much lower, asymptotically approaching 6%.)

Reply on news.ycombinator.com