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CSC: More Misery and Misfortune

Page 1 of the August 2002 issue of Prison Legal News carried a story about Correctional Services Corporation (CSC), the scandal-ridden private prison outfit beset with self-inflicted troubles. Since that story appeared, CSC's troubles have multiplied. Consider the following:

Ø In August 2002, a Texas court convicted a CSC Boot Camp nurse of negligent homicide following the death of an 18-year-old camper to whom she failed to provide adequate medical care.

Ø In January 2003, the New York State Lobbying Commission launched a probe into CSC's involvement with gifts improperly given to state legislators.

Ø Later in January, four female prisoners at a CSC-operated halfway house in Manhattan filed a federal lawsuit where they complained that they were sexually assaulted by a CSC counselor.

Ø In mid-January, a federal investigation report revealed that CSC employees' had been ordered to work on the election campaigns of New York's political elite: former Governor Cuomo, former Mayor Dinkins, and perennial victim Reverend Al Sharpton.

Ø Still further in January, a former prisoner at a CSC-operated youth facility in Nevada filed a federal lawsuit complaining that a female guard had forced the teenager to perform various sex acts.

Ø Late in January, the Albany County (New York) district attorney opened a criminal inquiry into CSC's dealings with state lawmakers.

Ø In February, the New York Lobbying Commission fined CSC $300,000 for failing to report gifts to state legislators.

Ø And finally, a former CSC vice president was dismissed after being arrested on charges of filming boys engaging in sex acts.

CSC, one of the nation's largest providers of privately run prisons and correctional services, traces its roots to New York City in the 1970s. There, James Slattery and Morris Horn operated a string of squalid welfare hotels and homeless shelters. The pair depended on state and federal contracts as their principal source of revenue. Horn is now deceased. Slattery went on to become the President and Chief Executive Officer of CSC.

In 1989, after the City of New York condemned one of their notorious welfare hotels, Horn and Slattery operated as Esmor Correctional Services Corporation and, in 1993, formed CSC by consolidating several companies that were engaged in the business of operating correctional and detention facilities.

In 1999, CSC merged with Youth Services International (YSI), a leading provider of developmental, educational, and rehabilitative programs for troubled juveniles. The YSI merger made CSC the country's leading provider of private juvenile justice facilities with 4,000 beds nationwide.

Through their Esmor subsidiary, CSC also operated the now-infamous U.S. Immigration and Naturalization Service Detention Facility in Elizabeth, New Jersey, just across the Hudson River from New York City. In 1995, after that facility erupted in riot and had to be closed, CSC moved its corporate headquarters to Sarasota on Florida's west coast. CSC's business interests in the Empire State remained strong, however, even after relocating its offices to Florida.

The Jackson Factor

Early in the 1990s, CSC hired Franklin Chris Jackson who eventually became a corporate vice president. Jackson, a political operative and lobbyist out of Brooklyn, helped CSC win government contracts to operate three halfway houses in New York City as well as state contracts to assist prisoners who were being released and re-entering society. When CSC moved its offices to Florida, Jackson remained in New York to oversee the company's operations there.

Jackson was a well-known figure who could often be found working the halls in the Albany statehouse. From 1992 until 2001, due in large part to Jackson's aggressive lobbying, CSC was awarded more than $22 million in state contracts. After CSC discharged Jackson in 2000, however, the company's business with the state dropped to zero.

Although no longer employed by CSC, Jackson remains at the center of the multi-agency investigation into CSC's influence peddling, illegal gift giving, improper reporting of lobbying activities, and bribery.

The New York State Lobbying Commission made headlines in January 2003 when it launched a major probe into the illegal conduct of state Assemblywoman Gloria Davis. Davis, 65, admitted to accepting bribes, gifts, and dozens of rides in CSC vans over a 4-year period, all in exchange for helping CSC keep state contracts to manage halfway houses. In January, she resigned her 22-year Assembly seat and was sentenced to 3 months in jail. Davis reportedly knew Jackson so well that he called her "Mom."

Along with Davis, Assemblyman Roger Green of Brooklyn admitted to accepting free trips to and from Albany in CSC's van and then applying to the state for reimbursement of travel costs he had not incurred. Green arrogantly denied wrongdoing of any kind. Since January, the still-secret probe has mushroomed and now threatens CSC with civil and criminal charges. Two types of criminal conduct by CSC are under scrutiny. First, CSC provided state lawmakers with free transportation between their New York City homes and the Albany statehouse. That transportation may be viewed as an unlawful lobbying expense because CSC failed to list it on its legally required, semi-annual lobbying reports. Second, CSC provided legislators with gifts and services valued at more than $75. State law says that no gift worth more than $75 may be given in an effort to influence a state official. Jackson's name repeatedly surfaced as the donor in many of the gift-giving inquiries as well as other aspects of the investigation.

Limitless Largesse

The allegations of free transportation, however, are not all that law enforcement officials are scrutinizing. Other areas of inquiry concern whether CSC provided free vans and cellular telephones to lawmakers and whether CSC's employees were assigned to work on the re-election campaigns of New York's political luminaries.

In mid-January, a U.S. Department of Justice report was delivered to the New York Legislature's Ethics Committee. The report alleges that during the 1990s, CSC employees were assigned to work on Democratic party political campaigns including those of former Governor Mario Cuomo, former Mayor David Dinkins, Representative Gregory Meeks of Brooklyn, Assemblyman Roger Green (who heads the black and Puerto Rican caucus in the Assembly), and political gadfly Reverend Al Sharpton.

Federal investigators produced evidence showing that Jackson organized crews of workers from the CSC-operated halfway houses to help out on the political campaigns. Full-time employees on CSC's payroll were assigned for several years, to work for Assemblyman Green and other black and Puerto Rican legislators. The CSC-provided workers would "do what the caucus members wanted them to do, working in their legislative offices, working in political campaigns, and driving them around," reported The New York Post.

The CSC staffers, the free van trips, and other amenities were provided to lawmakers over at least a 6-year period, said The Post. Mr. Slattery admitted that CSC rented minivans during the 2000 election and gave them to Assemblyman Green and other candidates. Former-CSC employees said that Green's political campaign workers also received free meals and a cellular telephone.

Other state legislators benefited from CSC's lobbying and largesse. Airplane tickets, fruit baskets, Valentine's Day chocolates, lavish meals, transportation, and free campaign workers were all made available to curry favor among lawmakers. While it was common knowledge that CSC's lobbying efforts in New York were led by Mr. Jackson, CSC's top executives said they had no knowledge of any questionable gift giving by Jackson. A federal report from the late 1990s tells a different story. That report contains testimony from CSC employees that company president Slattery knew about the favors Jackson was handing out to New York politicians.

In recent depositions before the state's Lobbying Commission, however, Slattery acknowledged the questionable practices but then tried to cast blame for the unreported lobbying activities on former CSC vice president Jackson.

Unpersuaded by Slattery's testimony, the Commission on February 27, 2003, imposed a record $300,000 fine on CSC. That $300,000 fine is the largest the state has ever imposed on a single company for breaking its lobbying laws. It tops the $250,000 fine paid by Donald Trump in 2000 for his improper lobbying to keep casino gambling out of New York.

Criminal Complications

In closely related investigations, criminal prosecutors in Manhattan and Albany continue to probe certain elected officials in New York and their relationships with CSC.

Early in March 2003, the New York State Board of Elections ordered CSC to seek refunds of political contributions it paid to candidates in 2002. State law bars corporations from giving more than $5,000 per year to campaign committees. CSC often exceeded that limit. John Mentzer, a CSC vice president and general counsel, said that CSC had asked political candidates to return a portion of any donations sent to them. "We're asking everyone we gave to [to] give us money back," he said.

Prosecutors continue to investigate whether any criminal laws were broken when lawmakers accepted favors from CSC. Mentzer said he is not aware of anyone "currently employed by the company" who is the target of the criminal investigations. "Certainly it's not the kind of thing we wanted to be involved with," Mentzer added. "It does come up in our discussions with prospective customers, and we expect that will be the case for the foreseeable future."

Lobbying Commission investigators have asked Manhattan District Attorney Robert Morgenthau for permission to review the secret grand jury transcript from the investigation of now-disgraced Assemblywoman Gloria Davis. Commission members expect the transcript to reveal further details of CSC's suspected illicit activities.

In a deposition taken before the Commission, one CSC employee described how a certain lawmaker would demand free transportation to Albany as if it were a birthright. Another lawmaker was said to have complained about the filthy state of a company van that CSC had assigned to him.

CSC has declined to talk in detail about the bribery allegations but general counsel Mentzer said there is more to the story. "Let's just say the bribes weren't offered, they were demanded," he said.

In response to the swirling allegations, investigations, and a record-setting $300,000 fine, CSC agreed to correct and refile its lobbying reports for 2000 and 2001. A company spokesman said that CSC will adopt "stronger and clearer policies" related to political contributions and activities.

The Texas Boot Camp Death

Until the summer of 2001, CSC operated the Mansfield boot camp for Tarrant County (Fort Worth) Texas. In January 2001, Bryan Alexander, an 18-year-old camper who had been sentenced for drunk driving, died of pneumonia after being improperly diagnosed and treated by camp nurse Knyvett Reyes.

The CSC nurse was charged with negligent homicide and convicted in August 2002. Reyes was sentenced to 4 years' community supervision, ordered to surrender her nurse's license, and pay $11,000 in restitution to Alexander's family. Reyes is barred from performing any nursing duties involving direct patient care during her 4-year probation. She-is now working as a hospital clerk.

A civil trial over Alexander's death has gotten underway. PLN will report on the verdict in a future issue.

Sexual Shenanigans

CSC's troubles in New York are not limited to questionable campaign contributions and schmoozing the lawmakers. Four female clients at the CSC-operated Le Marquis Community Correctional Center on Manhattan's East 31st Street have filed a federal lawsuit where they allege a CSC counselor lured them into his office and sexually assaulted them.

Out west, a former teenage prisoner of the CSC-operated Summit View Youth Correctional Center in Nevada filed a civil rights lawsuit asking CSC for $3 million in damages. Ryan Layman, now 20, alleges that a female guard at the North Las Vegas facility used him as a sex slave. According to Layman's federal lawsuit, guard Jennifer Burkley subjected him to repeated sexual assaults between November 2000 and January 2001. "Burkley, acting in her official capacity and using her position of authority, would enter Mr. Layman's room and unlawfully coerce, force, and intimidate the child into performing various sexual acts, all against the child's will and consent," says the complaint. Layman was age 17 at the time of the alleged incidents.

In November 2001, Burkley and another former Summit View female guard were sentenced to 2 years' probation for crimes which involved allegations that they performed oral sex on incarcerated teens. And finally, whatever happened to Franklin Chris Jackson, the flamboyant, extravagantly generous CSC vice president who orchestrated so many political deals with New York lawmakers? According to his attorney, Gail Laser, Jackson is terminally ill with cancer and is not able to provide testimony to the investigators.

But why did CSC dismiss Jackson after 8 years of loyal and productive service? It seems that in 2000, while on vacation in the Dominican Republic, Jackson was arrested on pornography charges. He was accused of photographing young boys engaged in various sex acts.

Sources: Fort Worth (Texas] Star-Telegram, Las Vegas Review-Journal, The New York Daily News, The New York Herald Tribune, The New York Post, and The New York Times

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