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Private Companies Making Millions In Profit Exploiting Inmates Families

April V. Taylor

JPay, Bank of American and J.P. Morgan Chase are three of the companies making millions in profit by exploiting the families of those who are in prison.  The Center for Public Integrity recently did an investigation into how these companies are profiting off of innocent people by shifting costs and charging exorbitant fees to inmates’ families.

One of the people investigators met was 64-year-old Pat Taylor.  She works as a housekeeper and struggles to be able to visit her son and send him money.  Her son Eddie is serving a 20-year sentence at Bland Correctional Center in Virginia, 137 miles from where Taylor lives.  Taylor admits she goes without paying bills sometimes to be able to send her son money and that she is forced to alternate seeing him with sending money because she can not afford to do both each week.

What makes Taylor’s situation seem unfair is that she used to be able to send her son money for less than $2 by purchasing a money order at the post office.  However, now that JPay Inc. handles all deposits to Virginia Department of Corrections inmates’ accounts, it now costs her ten times the original amount.  JPay charges $6.95  in addition to up to 35 percent of the amount she is sending.  To make matters worse, her son still does not receive the full amount of the remaining money.  Fifteen percent goes to court fees and a mandatory savings account her son will receive when he is released, but the economic exploitation does not end there.  The interest on the savings account then goes to the Department of Corrections.

What makes the situation shameful is not only that Taylor is forced to pinch pennies to be able to send her son money but also that he needs the money for such basic things as toothpaste, doctor visits and winter clothes.  Some states even charge inmates for toilet paper, electricity and other boarding fees.

JPay, along with such big names banks as Bank of American and Chase, are legally able to collect tens of millions of dollars a year from inmates’ families.  The Center for Public Integrity found that some inmates’ families are forced to make harsh sacrifices as these companies profit extensively from their pain.  Those sacrifices include skipping utility bills limiting contact with their relatives in prison and skipping medical care for themselves.

These companies have essentially erected a virtual tollbooth that families and inmates are forced to continue to pay into.  What many fail to realize is that the system of costs perpetuate a cycle of poverty for poor families who have a relative in the system because any extra earnings go towards these companies profits instead of helping them gain some kind of upward mobility.

JPay declined to be interviewed by the Center for Public Integrity, but by reviewing public records and speaking to former employees, the center found that JPay earned more than $50 million in revenue in 2013.  While JPay claims that they only charge the fees necessary to maintain a “razor thin” profit margin, other companies have been able to provide similar services charging less.

Another aspect of this system’s exploitation is the fact that states and prison operators receive kickbacks through profit sharing with JPay and other companies.  Prison operators are also able to charge inmate’s accounts for supplies such as toilet paper and medical co-pays until the account has a negative balance.  This means that when inmates do receive money, they rarely have money left to purchase supplies that are considered “optional” such as stationary or sturdier shoes.

Seeing how this system plays out in the lives of families and inmates illustrates how predatory the system is. The following graphic shows how $120 gets raided by various companies and interests:

fees

Another illustration comes from Linda Dolan, who wanted to buy her son an extra pair of underwear and socks.  Due to St. Lucie County’s intake fee and daily rent charge, Dolan’s sons account was already in the negative by $70.  This meant that in order to purchase her son the underwear and socks, she would have to put $100 in his account, which she did not have.  Dolan states, If relatives are putting money on somebody’s books while they’re an inmate, it’s to help them buy necessities.  I didn’t think it was right that the county was stealing the money.”

Items and services are over priced, many times being priced higher than 40 percent or more of what the good or service normally costs.  Prison vendors and prison are all profiting from the exploitation of inmates and their families.

Another company “stealing” from families through fees is Bank of America who has a contract with the federal government to provide money transfers, e-messaging and some telephone services to some federal inmates.  Chase bank has a no-bid contract to provide high fee debit cards to inmates to access both the money they earn and the money their families send them.  Chase has been able to sidestep any oversight and competition by using a 150-year old authority, which means in addition to having a no-bid contract, their are no competitors to drive down prices for those forced to use the service.

With the United States having the largest prison population in the world, these companies and municipalities have a cash cow that they can continue to raid at the expense of exploiting families who have not committed any crime other than wanting to love and support their family member.  The fact that the poor and people of color are locked up at higher rates than the rest of the population means that this system of profits is taking the most from those who can least afford it.  This system of profit is ethically wrong on so many levels, and cannot be allowed to continue to exist as a system of exploitation of some of the most vulnerable people in American society.

april

19 Comment

  1. What has been said is so true. The criminal justice system is using poor people and people of color to fatten their wallets. This is an on going cycle and the only way to break it is to cut off the criminal justice system supply- people stop going to jail about nonsense, the C.J system does enough under handed things to get us anyway.

  2. Stop going to jail. We know White folks want us in prison for these exact porposes. We have to stop giving them the ability to treat us in this manner…

  3. The USA by and through Wall Street is acting like the Devil's advocate. Military weapons in one hand and the Bible in the other..

  4. Shameful and what is the Federal Attorney General doing about this issue?

  5. Just a continuation of this country's long & documented history of making $ off of our misery. It's the american way.

  6. This is able to exist because of lacking of education among minorities. Financial education is rarely taught

  7. Are you serious? There is no correlation between financial education and how black families being exploited by the DOC and big businesses. The the "no bid" contracts is hurtful to a fair and humane process. If my loved one was in prison and needed medical care, clothing for the winter, soap, ect., I don't think financial education would play a part, Dummy.

  8. Roco Speaks

  9. Let's wake up! Pull our money from these blood sucking Banks and institutions!

  10. Everybody is gonna try and make something off of somebody no matter what.

  11. An inmate has three meals a day, a bed to sleep in every night, cable TV to watch, a library filled with books to read, all provided free of charge by tax payers. So what do they need money for anyway? How many people on the outside have far less? The biggest problem we have as Black people is our "backward ass thinking". These inmates are a drain on everyone with their criminal behavior. Their families (as in the case of this poor woman) is going without because she thinks she's doing the right thing. Obviously her son didn't, and doesn't care about her because even after his incarceration he is still causing her pain. If your kids or loved ones love and respect you they are not going to disappoint you by making your life miserable by engaging in criminal behavior that will cause you pain, suffering and financial difficulties. Naturally there are some exceptions but this is definitely true in the majority of the cases.

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