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Widespread Corruption in Private Halfway Houses

by Derek S. Limburg

Privately-operated halfway houses across the nation have become embroiled in scandals and mismanagement. The wrongdoing stretches from the top to the bottom, from former politicians and corrections commissioners to staff and prisoners.

Reports surfaced in June 2008 about operational problems at The Villa, a halfway house in Greeley, Colorado run by Avalon Correctional Services. A Colorado Public Safety Report on The Villa, also known as The Restitution Center, detailed numerous violations – including insufficient security, unqualified staff, falsified drug tests, and sexual relations between staff and prisoners. The sex reportedly took place in an area called the “Boom-Boom Room,” and weapons and drugs were found in a tunnel at the facility.

Following the report, the state canceled its contract with Avalon. The residents of The Villa were moved to a community corrections program at the Weld County Jail, and management of the program was assumed by another company, Intervention, Inc.
Reports concerning two other Colorado halfway houses operated by Avalon, the Phoenix Center and the Loft House, also found problems – including poor training, inadequate record-keeping and high employee turnover.

“It makes you question whether [the company] should still be in business in Colorado,” said state Rep. Liane McFadyen, who is a member of the Community Corrections Advisory Council.

In Atlanta, Georgia, former Dismas Charities employee Terrence Clay received a sentence of one year and one day in prison and a $1,000 fine for soliciting and taking bribes. Clay was employed by Dismas, a non-profit organization, at a halfway house for federal prisoners. At least twice in 2007, Clay solicited and received $1,000 from a prisoner in exchange for certain favors.

“Today’s sentence should send the message that these serious crimes will continue to be prosecuted and punished,” said U.S. Attorney David E. Nahmais.

In Alaska, Bill Weimar became the 11th person nettled in an extensive joint investigation into political corruption conducted by the FBI and U.S. Department of Justice. Weimar pled guilty on August 11, 2008 to two federal felonies in U.S. District Court in Anchorage.

In 1985, Weimar and a group of partners founded Allvest, Inc. He then bought out his partners and turned Allvest into a multimillion dollar corporation with $10 million in annual government contracts to provide halfway houses, drug treatment programs and other services.

Weimar admitted he paid a consultant $20,000 during the August 2004 primary elections to cover a senatorial candidate’s consulting fees. Court documents cited phone calls in which the candidate told Weimar he was unable to pay the fees. Weimar agreed to cover the cost, noting it was illegal. “There’s no legal way to do that. At least not on that scale,” he said in a recorded conversation.

Weimar sent the consulting company a check for $3,000 and also express mailed them $8,500 in cash. The next day he cut the consultant an $8,500 check. Weimar likely saw this as a worthwhile expense, as he reportedly held a $5.5 million contingency interest if a local private prison project was completed, and he knew the candidate would support the project if elected.

Neither the consultant nor the senate candidate accused of conspiring with Weimar were named in court documents. However, contextual clues point towards former state Senator Jerry Ward as the unidentified candidate.

According to the federal indictment, by 2004 the candidate already had a long relationship with Weimar and held an elected office part of that time. Ward was elected in Anchorage in 1996 and in Kenai Peninsula in 2000. In 2002, Ward lost his re-election bid and attempted to regain his seat in 2004, losing in the primaries.

As a state senator, Ward had pushed hard for a private prison. In 1997, plans for a privately-run correctional facility in South Anchorage, involving Allvest and another company, Veco Corp., operating under a partnership called Corrections Group North, fell apart in the face of heavy public opposition.

In 2001 a House bill that pushed a private prison in Kenai was introduced, and Ward was one of three Senate sponsors. That effort, which involved Weimar, Veco Corp. and private prison firm Cornell Corrections, was unsuccessful. Weimar had sold five Alaska halfway houses to Cornell in 1998 for $21 million, and later partnered with the company on the Kenai prison project.

The government’s case against former State Representative Tom Anderson also centered on the failed private prison initiative in Alaska. A key witness at Anderson’s trial was Frank Prewitt, a former Alaska Dept. of Corrections commissioner, private prison consultant and FBI informant.

Prewitt admitted he had accepted $30,000 from Weimar in 1994 while he was still corrections commissioner. He testified that he considered the money a loan, which he repaid by working four months free of charge for Allvest after leaving his position with the state.

Bill Bobrick, a former executive director of the Alaska Democratic Party, also testified against Anderson. Bobrick, who was a lobbyist for Cornell, pleaded guilty on May 16, 2007 to conspiracy to bribe Anderson; he served five months in jail and five months on house arrest, plus two years on probation and community service work.

Anderson was convicted in July 2007 on seven felony charges related to accepting bribes to provide political influence for the unsuccessful private prison project. He was sentenced to five years on October 15, 2007.

No Cornell officials were indicted, and the company reportedly was unaware of any improprieties or the federal investigation involving Anderson and Bobrick.

Weimar, now 68 and living in Montana, pled guilty to conspiracy to commit mail and wire fraud and illegally manipulating currency transactions to avoid federal reporting requirements. He was sentenced in November 2008 to six months in prison and six months on home detention, plus a $75,000 fine. His company, Allvest, had filed for bankruptcy in 2002 due to unpaid civil judgments.

These are but a few examples of the growing problems with the privatization of correctional services, including halfway houses. “Corruption by those who administer our prisons and other correctional institutions undermines the safety of everyone in those institutions, and further undermines the critical role they play in deterring and rehabilitating criminals,” stated U.S. Attorney Nahmais.

Sources: Anchorage Daily News,,, Greeley Tribune, Associated Press, “Alaska’s Citizens Lock Out Private Prisons” by the National Institute on Money in State Politics (Nov. 6, 2008)

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