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Should Private Companies Exploit Prisoners Through Exclusive Government Contracts?

by Dale Chappell

A recent article in the journal Criminology & Public Policy posed the question of whether private, for-profit companies should be allowed to contract with government agencies to be the sole provider of criminal justice-related services, without public transparency or oversight of the prices or fees set by those companies.

While the focus of privatization in our nation’s corrections system is often on companies that operate prisons and rake in billions of dollars in revenue, another lucrative market exists for businesses that provide other criminal justice services the government would rather farm out. Private companies then effectively become substitutes for public agencies, but are able to hide behind a veil of secrecy that only corporations enjoy.

Parolees, probationers and other people on supervised release typically have numerous court-ordered stipulations they must follow, such as home detention, electronic monitoring, ignition-interlock devices on their vehicles, substance abuse treatment, payment of fines, fees and restitution, and various other requirements.

Private businesses often provide such services, which come at a price – and the parolee, probationer or defendant is usually the one who pays.

For example, in Seattle, Washington, companies install and manage court-ordered ignition interlock devices for DUI offenders. The cost is $70 to $150 to install the device plus monitoring fees of $60 to $150 per month. Additionally, it costs around $100 to have the device removed after completion of the court sanction.

Seattle also uses a private company to collect court fees and fines, allowing Harris and Harris, Ltd., its contracted provider, to charge collection fees ranging from 15 to over 20 percent, plus “set-up fees.”

In Georgia and other states, private probation companies contract with local governments to provide supervision services, which are charged to probationers. When a court-ordered payment is made, the company takes its cut first and the remainder goes to the court. In 2014, the Georgia Supreme Court held a private probation company had violated the law by extending a probationer’s term of probation for not completing fee payments. [See: PLN, July 2015, p.40].

Private businesses also rake in huge profits by contracting with corrections agencies to provide prisoners with services such as secure email, video calling, phone services, MP3 players and music, tablet computers and commissary. The agencies that contract with such firms care less about what prisoners are charged and more about the cut they receive in “commission” kickback payments.

Just a handful of companies enjoy monopoly contracts for the services they provide to this “captive market.” For example, JPay has contracts with 35 states and the District of Columbia to provide money transfer and tech services to prisons and jails. In 2015 the company was purchased by Securus Technologies, making it the single largest firm providing such services for prisoners.

Other companies that enter into monopoly contracts to provide various services to prisons, jails and corrections agencies include GTL, Keefe Commissary Network, NUMI Financial, Pay Tel, ConnectNetwork and HomeWAV.

But should such businesses be allowed to profit off prisoners, parolees and probationers, and, by extension, their families? Supporters claim that contracting out criminal justice services allows government agencies to offload the burden and cost of supplying and managing those services.

The more critical point made by the Criminology & Public Policy article is that the extra fees and costs added by private companies constitute “another layer of punishment” for current and former prisoners.

Studies have shown that prisoners, parolees and probationers are usually unemployed, undereducated, poor, and have issues with mental health and substance abuse addictions. Added fees and costs can create an undue burden they may never overcome; indeed, there have been cases where defendants were driven into debt they could never repay by private probation companies, because the fees and penalties were more than their income.

Further, according to the journal article, private companies that provide correctional services have little oversight or public transparency. In many cases their records are not available under public records statutes, unlike with government agencies. 

The position of Prison Legal News and its parent organization, the Human Rights Defense Center, is that private companies should not be allowed to exploit prisoners and their families by providing criminal justice-related services for the purpose of generating profit. 

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Source: Harris, et al., “Justice ‘Cost Points’: Examination of Privatization within Public Systems of Justice,” Criminology & Public Policy (May 2019)