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Prison Bankers Who Profit from the Inmates

164 points| nthitz | 11 years ago |time.com | reply

125 comments

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[+] gergles|11 years ago|reply
They also operate the e-mail system that can be used to send e-mail to/from inmates (using a JPay tablet, of course). You have to purchase 'stamps'. For e-mails.[1]

1: http://www.jpayinc.com/email_videograms.html

"One stamp corresponds to one 6000 character message (about the length of one handwritten page), or one attachment."

"JPay’s correctional email service is faster than regular mail, with inmates usually receiving emails within 48 hours." (emphasis added)

Looking up the pricing for a random facility[2], it's $18 for 40 'stamps', each one of which is good for 1 small attachment or 'page' of text. This is fucking extortion.

2: http://www.jpay.com/Facility-Details/Kentucky-Adult-Institut...

[+] hueving|11 years ago|reply
>This is fucking extortion.

Not to be too pedantic, but that's not extortion. Nobody is required to buy them nor are they threatened by not buying them.

[+] Fuxy|11 years ago|reply
I find it extremely hilarious since this is no different than the ridiculous data caps most american ISP's add to the contract.

Email doesn't cost more depending on the character count all email costs the same regardless of length same applies to America ISP's like Comcast.

It doesn't cost them more but they do certainly like to charge more what do they both have in common?

They are both for profit companies in an area where they are the only option due to intense lobbying and laws that price any potential competitor out of their market place.

There's a fine balance between regulation and for profit business and when the businesses are paying the regulator directly or indirectly it never ends well.

[+] Cabal|11 years ago|reply
I'm curious whether they'll be accepted into the next round of YC.
[+] jMyles|11 years ago|reply
The only question that rings to me anymore about these stories: What can I do?

What code can I write? What broker can I call? What form can I sign? How can I register my civic will so as to undo this blight?

For me, this is the most embarrassing thing about being a United States citizen.

[+] bcoates|11 years ago|reply
A good place to start is to refuse to cooperate with evil. The justice system depends on the active and passive cooperation of the general public.

Do not call the police. If the police wish to speak with you, on any matter, politely decline. If a known police or corrections employee tries to do business with you or at a place you work, inform them that their kind are not welcome here.

Don't underestimate the extent to which people are driven by the need to be welcomed and accepted by society. Shunning is a powerful tool of social control.

If you're more the "positive" type, consider encouraging your company to drop its official or unofficial policy against hiring felons (I'm making a reasonably safe assumption here). There are subsidies, tax credits, and insurance programs that might help your case, but it's easier to just not bother. Be the troublemaker that makes it easier to do the right thing.

[+] deadfall|11 years ago|reply
I am a victim of these ridiculous fees. I thought about how someone was getting rich and I justified the fees because of the convenience. It most certainly cut back how much I sent and how frequently I used it. This directly affects the incarcerated person.

Side note: PayPal allows you to send money to friends and family for free.

[+] corford|11 years ago|reply
Start a kickstarter campaign to create a not for profit, ethical competitor to JPay? Providing the prisons still get a similar commission (which according to the article isn't where the lion's share of the fees comes from), why wouldn't they opt to go with a payments firm that gives them good PR?

Edit: alternatively, maybe the stripe guys could fund/seed a philanthropic off-shoot to tackle this?

[+] calibraxis|11 years ago|reply
This is what activists do. The world isn't what you learn in civics class. There's no benevolent bureaucrat or 4-year king who'll give you the tools to fundamentally fix such problems. If you need that, then you're trained in helplessness, like cult members. (Who may pledge allegiance to cult symbols, spend half their day in a communal workplace under a leader's command and watchful eye, etc.)
[+] rhizome|11 years ago|reply
In the SF Bay Area there is a company called Telmate that has been posting job listings on Reddit and Craigslist at least for the past year or two. Telmate is a prison-phone company that charges slave-wage-earning prisoners a week's pay for a 20min call.
[+] tehwebguy|11 years ago|reply
Would be cool to try using a different credit card and charging it back every time. They will pay $15 - $25 per dispute.

Also would probably be fraud, and potentially impact the inmate.

[+] vacri|11 years ago|reply
Start out by talking to your local representative. Raise the issue with them and keep at it. Encourage others to talk to your rep or the reps in their area.
[+] crb002|11 years ago|reply
Lobby the correctional facility to use Dwolla.
[+] Fjolsvith|11 years ago|reply
The prison phone systems are also bilking families. In the Alaska prison system, I had to call collect to my family. Phone calls were limited to 15 minutes and they cost my family $33 per call. I hated calling them because I felt so bad about that cost.
[+] cgag|11 years ago|reply
They normally charge outrageous amounts for long distance calls, which is basically all their calls. Last year the FCC limited the max rate of calls to 25 cents a minute, or 3.75 for a 15 minute call. Still outrageous, but at least not as insane. They usually charge much less for local calls, and there are a lot of services that will set up a number local to the prison and forward calls to cell phones. It's easy enough to set a number yourself with twilio if you're technically inclined, but most people with family in prisons are unfamiliar with things like twilio or google voice.

[1]http://www.fcc.gov/document/fcc-reduces-high-long-distance-c...

[+] mindcrime|11 years ago|reply
There is a lot that one could say about this, but let me throw this in the mix: a big part of the problem is simply that we (the US) have far, far too many people incarcerated and "in the system" to begin with. The US ranks second only to the Seychelles in terms of "prisoner count per 100,000 of population"[1], at 707. And many of those people are in jail for non-violent crimes, or crimes for which restitution would be a better consequence than jail.

We need to decriminalise drug possession and sales, and focus on restitution for cases of theft, fraud, etc. The people in jail should be mostly murderers, rapists, and people who have shown themselves to be an active threat to society. And even then I'm not actually convinced that jail is the best solution, but let's tackle one problem at a time.

(Sidebar: a different Wikipedia page says the US incarceration rate is actually the highest, not second. See: http://en.wikipedia.org/wiki/United_States_incarceration_rat...)

[1]: http://en.wikipedia.org/wiki/List_of_countries_by_incarcerat...

[+] noonespecial|11 years ago|reply
So they bribe and kick-back their way through the year and then throw a big party (ahh 'convention') in Vegas where they give each other awards while sucking down premium liquor, hand-rolled cigars, and no doubt metric tons of the stuff half of their inmates are in prison for.

The pigs from 1984 would blush over this stuff.

[+] brudgers|11 years ago|reply
Animal Farm is Orwell 's dystopia with pigs.
[+] beloch|11 years ago|reply
This is a state-granted monopoly and it's being abused. The services JPay offers should either be government run or open to free market competition.
[+] innguest|11 years ago|reply
How can we trust the government to solve this when it was the government that created the problem to begin with?
[+] ajiang|11 years ago|reply
For the record, it's this exact injustice that kicked off Bayes Impact. Pyduan and I sat at dinner talking about my past life in private equity where I spent a lot of time looking at private prison companies, including JPay. There are huge barriers of entry into these markets, particularly in having close relationships with the decision makers: commissioners of the Department of Corrections.

The answer we came up with was a nonprofit that could develop strong relationships with civic institutions and be free from conflicts of interest and profit motives. This is a very poorly incentivized market, and startups will have a tough time disrupting the existing players because such perverse incentives exist. If anyone is interested in learning more, feel free to shoot me a message, and I'm happy to chat.

FYI, JPay is moving into all modes of communications and media, including email, video chats, music, etc. For families looking to keep in touch with their loved ones in jail, they are essentially the Apple in jails.

[+] mercurial|11 years ago|reply
The cynical way prisoners are exploited is reminiscent of the way prisons in the middle ages were run, except they didn't have marketers back then.
[+] innguest|11 years ago|reply
To me it is reminiscent of the way our government (and most others) works.

Both involve a monopoly on banking, granted by the government, to enrich government-selected corporations, at the expense of non-bankers.

No need to go back to the middle ages to find analogies. :)

[+] discardorama|11 years ago|reply
I don't understand. Why can't the state let a bank put a bloody ATM (or several) in a common area, and let the inmates use debit cards?

My blood pressure was shooting up as I read that article. I don't mind people charging a fee for providing better service. But in this case, this human leech is just spreading more misery. Why must these people abuse others this way? I hope, when he is on his deathbed, this fucker suffers the most unimaginable amount of pain for a long time.

[+] mercurial|11 years ago|reply
It's an entire system designed around extracting maximum value from the prisoners. How much do you think prisoners get paid per hour when working for Big Corp? The public and private sectors have a nice, cozy, win-win relationship, and the voters don't really give a damn about that.
[+] jqm|11 years ago|reply
Another shameful story about the criminal justice system in the US.... I wish I were more shocked.

I'm not a sociologist and I'm not going to look for links, but I'm pretty sure there is a strong correlation between poverty and crime. Now certainly correlation doesn't mean causation... but is keeping people in poverty more likely to cause or to prevent crime? But this question might make the bad assumption that the intent of the criminal justice system is to prevent crime in the first place.

We all pay for crime. Something to keep in mind. Social justice is more than just feeling good and being fair. It's about practicality also.

[+] eltondegeneres|11 years ago|reply
The solution isn't making a more efficient competitor to Jpay. The solution is abolishing prisons. Angela Davis has written a good short book on this subject called "Are Prisons Obsolete?".
[+] mercurial|11 years ago|reply
Well, that may be a bit of a stretch (are you really going to put seasoned killers in the street?). A first step would be ensure that inmates and their families are not treated like animals. Unfortunately, this is also a societal choice, and that's something often difficult to sensitize the citizenry to. A system like this prospers because both JPay and the authorities benefit from it, and because neither US citizens or the press, who could do something about it, care about what happens.
[+] trhway|11 years ago|reply
making profit out of prisons, in all shape and forms, is a such unbelievable conflict of interests. It is the ultimate monopoly - monopoly of force and violence - that is being abused by existence of any revenue stream associated with prison system.
[+] breitling|11 years ago|reply
"He says he charges only as much as he must to maintain a razor-thin profit margin."

I have a hard time believing this. Does any one have experience in this space? The way I understand it, it really shouldn't cost $6+ for an electronic transaction.

[+] ajiang|11 years ago|reply
I used to do work in this space and personally diligenced JPay for investment purposes. Their profit margins are low for the same reason most successful startups have no profit - growth. They're growing incredibly fast, investing in sales and marketing efforts (as well as the 'commissions'). Take out the growth aspects, you have a company with very high gross margins.
[+] concerto|11 years ago|reply
Two stories next to each other on the home page with someone called Ryan Shapiro in them, in both cases he is 37. One where he is an foia activist [1], and this one where he runs a company profiting from prisoner's families. Are they the same people or is this just a strange coincidence?

[1]https://news.ycombinator.com/item?id=8390642

[+] bliksem|11 years ago|reply
What an utterly sick, broken system. Cannot contain my despair at this.
[+] Fjolsvith|11 years ago|reply
CCA (Community Corrections of America) is owned by a group of judges, I believe. They run for-profit inmate holding centers across the US.
[+] 7Figures2Commas|11 years ago|reply
> CCA (Community Corrections of America) is owned by a group of judges, I believe.

CCA, Corrections Corporation of America, is publicly-traded REIT, as is GEO Group. Anybody here with access to the American public equities markets can purchase shares of stock in CXW or GEO.

[+] hyperliner|11 years ago|reply
There is a good lesson in this article that is getting lost in the debate. The lesson is don't go around committing armed robberies. You are screwing your family. More specifically, you are punishing your mother.
[+] penguindev|11 years ago|reply
Amateurs. We're all prisoners to ZIRP, QE, 'collectible' taxes on gold, and central banking which is all legalized counterfeiting for the .01%