What a monster we have created. 3,100 companies that profit from the criminal justice system! READ this article to see the depth of the problem. And THE problem is that all of those profiting are opposing needed changes!
See some of the many ways that privatization is destroying justice.
See some of the preposterous lies from the profiteers!
Virtually none of these fucking companies even existed when I was a prosecutor and defense attorney (’73 to ’83) and the system worked well!
Excerpts from the Article:
A report released by the American Federation of Teachers (AFT) in February 2019 spotlighted several major private equity firms that invest in and profit from the private prison industry, which the organization says continues to fuel mass incarceration in the U.S.
In addition to private equity firms, many other businesses have invested in the prison market, according to Bianca Tylek, founder of an advocacy group called Worth Rises, which has compiled a list of 3,100 companies that profit from the criminal justice system – some with familiar names like Amazon and General Electric.
“We’ve underestimated the size of the prison-industrial complex,” Tylek admitted. “Every estimate you’ve seen until now is a conservative one.”
The involvement of private equity firms, which manage large investment portfolios, presents a conflict between the financial and social goals of some investors.
The two largest for-profit prison companies are Nashville-based CoreCivic, formerly Corrections Corporation of America – with almost 14,000 employees and gross revenue of $1.83 billion in 2018 – and The GEO Group, based in Boca Raton, Florida, with 22,000 workers and $2.33 billion in revenue last year. Both are publicly traded corporations and their stock has found its way into retirement, pension and hedge funds.
Either by direct investment in for-profit prison companies or through mutual funds or private equity firms, a large number of public pension funds are invested in the private prison industry. That can make it problematic for people whose assets are tied up in private prison companies but who disagree with their business model, political lobbying and campaign contributions, higher levels of violence, poor medical care for prisoners and other issues.
Three of the largest public pension funds in the U.S. have taken action to cut ties with for-profit prison operators: the California State Teachers’ Retirement System, the New York City Employees’ Retirement System and the New York State Common Retirement Fund. [See: PLN, April 2019, p.60]. The Chicago Teachers Pension Fund and the New Jersey State Investment Council have also voted to divest from the private prison industry.
“Our union members serve tens of thousands of immigrant students in our schools, and we’re committed to taking any and all steps to protect their families from disruption or repression,” said Chicago Teachers’ Union President Jesse Sharkey. “That includes our refusal to support corporations that seek to profit from the national attack on immigrants – the same corporations that continue to profit from the mass incarceration of black people and the harm that continues to visit the families of our black students.”
Nearly 75 percent of immigrant detainees are housed in privately-operated detention facilities, most run by CoreCivic and GEO Group.
The AFT report highlighted seven private equity firms that hold ownership interests in various private prison companies, including Miami-based H.I.G. Capital, LLC, which has around $30 billion in assets under management and indirectly owns Inmate Calling Solutions (ICS), which provides prison and jail phone services. H.I.G. also owns Wellpath, a $1.5 billion prison healthcare provider formed in October 2018 when Correct Care Solutions (CCS) merged with Correctional Medical Group Companies (CMGC). CMGC was originally founded as California Forensic Medical Group, which served numerous county jails in California.
Prior to the Wellpath merger, CCS had been sued more than 140 times between 2005 and 2017. The company also had its contract terminated by Fulton County, Georgia after five prisoners died in less than three months. A video in a Westchester County, New York lawsuit showed CCS staff wheeling a prisoner who had collapsed back to his cell, where he subsequently died from a heart attack.
H.I.G. Capital also owns TKC Holdings, a company that includes Trinity Services Group, which provides prison food services; Keefe Group, which supplies prison commissaries; and ICS.
Trinity took over the contract for food service in Michigan’s state prison system from rival Aramark in 2016, but was terminated two years later. Both companies experienced problems maintaining staffing levels and food quality – there were reports of maggots in meal serving areas as well as misconduct by employees, including smuggling drugs and engaging in sexual relationships with prisoners. [See: PLN, June 2018, p.52; Jan. 2018, p.46; Feb. 2017, p.48].
Since 2017, another private equity firm, BlueMountain Capital Management, has owned prison medical care provider Corizon Health, which serves 180,000 prisoners and generates an estimated $1.4 billion in annual revenue. [See: PLN, March 2019, p.61]. Previously, Corizon was majority owned by Beecken Petty O’Keefe & Company.
According to the ACLU, Corizon has been sued more than 600 times since 2011, settling some cases for millions of dollars – including an $8.3 million settlement in a 2015 wrongful death suit in California. [See: PLN, March 2015, p.54]. The company lost its contract with the Arizona Department of Corrections at the end of 2018 due to serious and sometimes fatal neglect of prisoners in need of medical care. [See: PLN, April 2019, p.56].
Platinum Equity, LLC owns prison telecom company Securus Technologies, which it purchased from ABRY Partners. Securus acquired JPay in 2015, and has contracts at 3,400 facilities serving 1.2 million prisoners, who pay some of the highest phone rates in the nation, particularly at county jails. When the FCC capped intrastate (in-state) prison and jail phone rates in 2016, Securus and other companies fought the order, eventually prevailing in the DC Circuit Court of Appeals. The FCC, under new leadership during the Trump administration, refused to defend its intrastate rate caps in the case. [See: PLN, July 2017, p.52].
Securus, like other prison telecoms, engages in “commission” kickback arrangements with prisons and jails; it has been accused of illegally recording prisoner-attorney phone calls, has had its customer data repeatedly hacked, and previously required some jails to eliminate in-person visits when contracting with the company for video calling services.
Other private equity firms that own companies which profit from the criminal justice system include:
• American Securities, LLC owns GTL, which provides phone services to over one million prisoners at 2,300 facilities in all 50 states plus the District of Columbia and Puerto Rico;
• Apax Partners, LLP owns prisoner and parolee monitoring device firm Attenti;
• Bison Capital Asset Management owns Sentinel Offender Services, a pioneer in developing private probation and prisoner case management services; and
• Endeavor Capital owns Aladdin Bail Bonds, a nationwide chain.
Jeff Zanarini, a managing director at H.I.G. Capital, claims the equity firm’s investment in companies that provide criminal justice services is so small that it plays “no role whatsoever in shaping the nation’s jails and prisons.” If anything, he said, H.I.G. is “focused on improving the health and well-being of prison populations, while providing services that are far superior to the available alternatives (i.e., the provision of such services by state and local governments).” He provided no evidence to back up that claim, nor did he address the abysmal track records of companies like Wellpath/CCS and price-gouging by firms like ICS and Keefe Group.
Bianca Tylek said the Corrections Accountability Project, a project of Worth Rises, found that by acquiring and merging local and regional businesses into huge national companies, private equity firms have a profound impact on the private prison industry.
“Without [private equity] shops, these companies could not have become as big and as exploitative as they are today,” she noted.
The American Federation of Teachers cautioned in its report that public pension funds which invest in companies that provide prison and jail services, directly or through private equity firms, risk unnecessary liability and exposure. Previously, the AFT had appealed to teachers’ pension funds to divest stock holdings in companies that operate prisons and immigration detention centers.