These Five Corporations Are Making Millions From Mass Incarceration

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Likely the most well-known prison profiteers in the United States are the Corrections Corporation of America and The GEO Group. Between them, these two firms pulled in about $3.3 billion last year running scores of private prisons and immigration detention centers.

Like many of the firms that reap profits from the prison-industrial complex, they keep quiet about it.

However, these two firms are not alone feasting at the trough of corrections expenditure. Many other companies, most of them off the popular radar, are also benefiting from epidemic prison and jail building. Some may even be even operating in your neighborhood. Here we’ll do a quick sketch of five such companies, outline their activities, ponder their deeds of infamy, and reflect a little on how to curtail their profiteering.

No. 1: Turner Construction: If We Build it They Will Come

Let’s start with the construction sector. Prison construction managers don’t come with a tool box and a pick-up. They are world-class operators. The largest player in this field is New York-based Turner Construction, a subsidiary of the German giant Hochtief.

According to IbisWorld, Turner’s average annual income for prison and jail construction came to $278 million per year from 2007 to 2012. This represents lots of money in most quarters, but qualifies as only slightly more than pocket change to a firm that earned $9 billion in total revenue for 2013. In almost a century and a half of operation, Turner has been involved in building New York’s Lincoln Center for the Performing Arts, Kansas City’s Arrowhead Stadium and constructing corporate headquarters for Boeing and the RAND Corporation. It has about 5,000 employees worldwide.

Despite prisons and jails not being their core business, they are still virtually omnipresent in the sector. Turner did construction management for a 6,000-bed facility in Bunker Hill, Indiana, participated in an $800 million overhaul of several state prisons in Pennsylvania in 2009, led work on jail construction in Forsyth County, Georgia ($100 million), Fort Bend County, Texas ($75 million), Johnson City, Kansas ($50 million), Kenton County, Ohio ($41 million), as well as on two jails custom-built for Corrections Corporation of America in Georgia’s Wheeler and Coffee counties at an estimated total cost of $80 million.

The demand for bigger and more secure court facilities prompted Cook County in Illinois to contract Turner in 2009 for the $110 million renovation of Chicago’s Everett Dirksen Court House. The Army Corps of Engineers employed Turner to upgrade their Detroit Border Patrol Station for $14 million in 2013.

Like many of the firms that reap profits from the prison-industrial complex, they keep quiet about it. Their website highlights their role as the “leading builder of green buildings.” They also proclaim on their website: “We have the highest ethical standards in the industry. We ‘do the right thing.'” Perhaps doing the right thing might include pulling out of prison and jail building altogether, especially since an income cut of $278 million would reduce their annual revenue only by about 3 percent.

No. 2: BI Incorporated: Keeping Track of “Offenders”

Colorado-based, BI Incorporated manufactures electronic monitors. They specialize in cutting edge GPS-based devices that deliver real-time location tracking. BI also offers technology for monitoring of alcohol consumption through an ankle bracelet or a remote breathalyzer known as Soberlink. BI monitors about 60,000 people at any given moment in all 50 states.

More people out of prison on ankle bracelets could mean plummeting profits for the GEO Group prison operations.

BI also contracts with state and county authorities to supervise people on electronic monitoring, in essence offering a form of privatized probation and parole. This supervision is typically done through “community-based” electronic monitoring offices. In most of their “community” corrections work, they stress the notion of user pays. In some instances, BI “probation” officers are expected to be the collection agents for these fees. Former employees have reported to Truthout that they received a bonus if they passed a certain target in collecting fees for services from their clients. In addition to community-based offices, BI operates a national call center from Indianapolis, which tracks all those on BI GPS monitors across the country.

While traditionally BI’s monitoring market has focused on those involved directly in the traditional criminal justice system, in 2009, BI entered a new field: immigration. They signed a five year, $372 million contract with Immigration and Customs Enforcement (ICE) to intensively supervise up to 27,000 people who were awaiting judgment in deportation or asylum cases, but not held in detention centers. The ICE contract was renewed in 2014, though reduced to roughly $235 million for five years.

BI was an independent firm for over two decades, but their contract with ICE made them an attractive target for acquisition. Hence, in 2011, the GEO Group bought out BI for $415 million. GEO Group’s acquisition of BI was in line with the increasing specialization of private prison companies in immigration. While the private prisons own or operate only about 8 percent of prison beds across the country, they control more than 40 percent of the immigration detention cells. However, acquiring BI also helped position GEO to limit the extent to which BI might market electronic monitoring as an alternative to incarceration. More people out of prison on ankle bracelets could mean plummeting profits for the GEO Group prison operations.

No. 3: Aramark: Would You Like a Maggot with Your Meal?

Some Truthout readers might actually be familiar with Aramark’s role in food service provision in colleges and universities. Their dedicated higher education website proclaims the company offers a “total hospitality experience…  customized for each higher ed institution we work with.” In 2014, Fortune magazine included Aramark on its list of “World’s Most Admired Companies,” and Ethisphere added them to the list of “World’s Most Ethical Companies.”

Aramark markets itself as a “green” corporation, taking credit for the recycling of 17.8 million pounds of waste on the campuses it services via participation in the Coca Cola-sponsored Recyclemania Program. In 2013, its revenue was just under $14 billion. It employs 162,000 people worldwide.

The numerous Ohio prisons, where Aramark operation coincided with the presence of maggots, registered no denials of the company’s guilt.

While the company wins prizes for its work in higher education and upmarket conference centers, far less well known are Aramark’s operations in more than 600 correctional facilities in which they serve more than a million meals per day. They hold or have held food contracts with state prison systems in Florida, Indiana, Kansas, Kentucky, Michigan and Ohio as well as with dozens of county jails. The two-year contract with Ohio in 2013 involved $110 million. A similar agreement with Michigan was concluded for $145 million.

While these contracts have been healthy for corporate bottom lines, they have brought Aramark far more reprimands than accolades. Their reprimands include $200,000 in fines in Michigan for food shortages and a $142,000 penalty in Ohio for not hiring enough staff, as well as other infractions.

Apart from shortages, there were also a series of reports of maggots in the food in both states. While Corrections authorities later absolved Aramark from responsibility for the presence of maggots in Michigan, the numerous Ohio prisons, where Aramark operations coincided with the presence of maggots, registered no denials of the company’s guilt.

These problems in Michigan and Ohio are but the latest chapter in carceral food service debacles involving Aramark. Florida terminated a contract with Aramark in 2008 after repeated violations. In addition, Aramark employees have been involved in a number of activities deemed inappropriate.

An Aramark employee in Indiana was charged with a felony for delivering marijuana and a cellphone to prisoners. In Michigan in 2014, four Aramark employees were suspended for allegedly having illicit sexual contact with male prisoners in a walk-in kitchen cooler, and dozens of other former Aramark staff have been permanently banned from Michigan state prisons.

While they may be winning prizes on college campuses, Aramark clearly has lower standards when it comes to serving people behind bars.

No. 4: Securus Technologies: Justifying $1.3 billion in Kickbacks

Securus Technologies specializes in telecommunications in prisons and jails. It currently is the second largest provider of carceral phone services. The company was acquired by Castle Harlan, Inc., a New York-based private equity corporation, in 2011 for an estimated $450 million. Securus currently operates in some 2,200 correctional facilities in North America.

For years, companies like Securus have been winning phone contracts by overcharging customers, then paying kickbacks to state departments of corrections and local sheriffs. Nationally, the FCC estimates that kickbacks come to over $400 million annually. All of these kickbacks, officially called “site commissions” are legal – written right into the contracts.

Illinois is a typical example of Securus’s operations in this world of phone superprofits. The company currently holds the phone contracts in 76 of the state’s 102 county jails, as well as the lucrative pact covering some 48,000 men and women in Illinois Department of Corrections (IDOC) prisons.

In 2012, the kickbacks for the state prison contract alone put some $12 million back into the IDOC’s coffers. For a person in an Illinois state prison, any intrastate phone call, even a one-minute conversation, will cost $4.05. Plus, to pay for the call, family members must deposit a minimum of $25 in a pre-paid account, and pay an extra fee of $7.95 to be able to make the deposit. At the county level, some rates are even higher, with some callers paying up to $7.55 for a 15-minute local call.

Moreover, many Securus video contracts mandate that the jails ban face-to-face visits to generate more money for the video system.

Securus has vigorously defended the $1.3 billion in kickbacks it has paid out over the last decade. Company CEO Richard Smith argued that “Clearly these commission payments that have been used to fund critical inmate welfare programs and support facility operations and infrastructure have improved the lives of inmates, victims, witnesses and individuals working in the correctional environment, and helped to fund government operations.”

A national Campaign for Prison Phone Justice, involving more than 50 organizations,vehemently disagrees with Smith’s assessment. Members have been pressuring federal authorities to cap the charges on prison phone calls and to eliminate the kickbacks. The Federal Communications Commission is presently considering action to curb the profits earned by Securus and others involved in carceral telecommunications services.

In recent years, Securus has been branching out into other revenue pools in the prison-industrial-complex. One new area of operations has been video visiting. Typical video visitation contracts charge loved ones a dollar a minute to have what is essentially a Skype session with a person inside a jail. Moreover, many Securus video contracts mandate that the jails ban face-to-face visits to generate more money for the video system. However, its plans to impose a system to eliminate face-to-face visits in Dallas County, Texas, earlier this year were blocked through a national mobilization lead by the Campaign for Prison Phone Justice.

More recently, Securus bought up controlling interest in STOP, a major provider of electronic monitoring services in the United States, another future income stream. User fees for being monitored currently run anywhere from $5 to $40 a day.

No. 5: Bob Barker: “Honoring God in All We Do”

Incarceration Nation

While a host of suppliers have found prisons and jails to be a unique niche, perhaps none has adapted to the new marketplace as masterfully as Bob Barker Industries. Founded in the 1970s and now based in Fuquay-Varina, North Carolina, Bob Barker (no connection to the former TV game show host) produces a wide range of goods for prisoners and prison staff.

The firm bills itself as a “worldwide leader in delivering innovative products and services to correctional and rehabilitation customers.” The company vision: “Transforming criminal justice while honoring God in all we do,” captures the divine inspiration behind their profit-making.

Barker’s transformation program includes a variety of cheaply made goods for the incarcerated: jumpsuits, sandals, T-shirts, board games, and black-and-white-striped canvas shoes. They also sell steel stools and benches for day rooms and yards.

In 1999, they opened their “officers-only” line and began to offer corrections staff a range of uniforms plus security items like handcuffs, and leg shackles. In more recent years, they have diversified into body armor, eyeglasses featuring imbedded digital cameras and riot shields.

One of their points of pride is innovation. A 1996 trademark application landed them the brand “Correctional Classics.” Since that time these classics have taken a number of forms. In response to overcrowding, they designed a three-tier bunk, which many facilities have used to house people in gyms and day rooms and other places which were never designed as living space. Perhaps their most heavily marketed product is the van cell, which allows officers to lock a person inside a cell while they are being transported from one destination to another.

However, likely their most famous catalog item is the most simple: the throwback, striped prison uniform. With the revival of such stigmatizing clothing in the last decade, Bob Barker has been at the forefront, with an edition the firm markets as the “convict classic.”

While production has sapped most of the firm’s energy over the past four decades, about two years ago, Bob Barker Industries underwent a process of reflection and added a vice president of social responsibility, tasked with monitoring and improving the company’s impact.

Since that time, some changes have taken place, including the installation of solar panels at company headquarters as an energy-saving measure. However, perhaps their most daring venture has been the initiative sparked by Bob Barker, Jr. (son of the company founder) to address recidivism. Based on the newfound company revelation that “incarcerated individuals have value in the eyes of God,” the newly minted Bob Barker Foundation has attempted to support a number of rehabilitation initiatives.

In fact, Bob Barker Jr., in an interview with a North Carolina TV show, said that he “would die a very happy man” if the company could be so successful in combatting recidivism that they would go out of business. Though the company’s finances are not public, they earn an estimated $100 million a year in revenue. And despite Bob Barker’s vows of self-sacrifice and devotion to ending recidivism, they are not likely to close up shop any time soon.

Copyright, Reprinted with permission.

james kilgore
James Kilgore is a research scholar at the University of Illinois’ Center for African Studies and an activist with the Champaign-Urbana Citizens for Peace and Justice in Illinois. He is the author of three novels, all of which were drafted during his six and a half years of incarceration. His forthcoming book, to be published by the New Press in 2015, is titled Understanding and Ending Mass Incarceration: A Primer.
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