PRIVATE PRISONS and INVESTMENT RISKS How Private Prison Companies Fuel Mass Incarceration—and How Public Pension Funds Are at Risk

RANKING ASSET MANAGERS REPORT

PART TWO

Copyright © American Federation of Teachers, AFL-CIO (AFT 2019). Permission is hereby granted to AFT state and local affiliates to reproduce and distribute copies of the work for nonprofit educational purposes, provided that copies are distributed at or below cost, and that the author, source, and copyright notice are included on each copy. Any distribution of such materials to third parties who are outside of the AFT or its affiliates is prohibited without first receiving the express written permission of the AFT.

Randi Weingartenpresident

Lorretta Johnsonsecretary-treasurer

Mary Cathryn Rickerexecutive vice president

AFT Executive Council

Our Mission

The American Federation of Teachers is a union of professionals that champions fairness; democracy; economic opportunity; and high-quality public education, healthcare and public services for our students, their families and our communities. We are committed to advancing these principles through community engagement, organizing, collective bargaining and political activism, and especially through the work our members do.

J. Philippe AbrahamShelvy Y. AbramsBarbara BowenVicky Rae ByrdChristine CampbellZeph CapoAlex Caputo-PearlDonald CarlistoLarry J. Carter, Jr.Kathy A. ChavezMelissa CropperEvelyn DeJesusAida Diaz RiveraJolene T. DiBrangoMarietta A. EnglishEric FeaverFrancis J. FlynnDavid GrayAnthony M. HarmonDavid HeckerJan HochadelFedrick C. IngramJerry T. JordanTed KirschFrederick E. Kowal

Louis MalfaroTerrence MartinJoanne M. McCallJohn McDonaldDaniel J. MontgomeryMichael MulgrewCandice OwleyAndrew PallottaJoshua PechthaltPaul PecoraleDavid J. QuolkeJesse SharkeyDenise SpechtWayne SpenceTim StoelbJessica J. TangAnn TwomeyAdam Urbanski

J. Philippe AbrahamShelvy Y. AbramsBarbara BowenVicky Rae ByrdChristine CampbellZeph CapoAlex Caputo-PearlDonald CarlistoLarry J. Carter, Jr.Kathy A. ChavezMelissa CropperEvelyn DeJesusAida Diaz RiveraJolene T. DiBrangoMarietta A. EnglishEric FeaverFrancis J. FlynnDavid GrayAnthony M. HarmonDavid HeckerJan HochadelFedrick C. Ingram

Jerry T. JordanTed KirschFrederick E. KowalLouis MalfaroTerrence MartinJoanne M. McCallJohn McDonaldDaniel J. MontgomeryMichael MulgrewCandice OwleyAndrew PallottaJoshua PechthaltPaul PecoraleDavid J. QuolkeJesse SharkeyDenise SpechtWayne SpenceTim StoelbJessica J. TangAnn TwomeyAdam Urbanski

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Private Prisons and Investment Risks, Part Two How Private Prison Companies Fuel Mass Incarceration—and How Public Pension Funds Are at Risk Since2013,theAmericanFederationofTeachershasperiodicallyreleased“RankingAssetManagers”reports.Thesereportshaveprovidedinformation,forthepurposeoftransparency,riskanalysisandeducation,forpensionfundtrusteesandmanagers.ThisistheAFT’ssecondreportinatwo-partserieshighlightingtheinvestmentriskstopensionfundsandotherinvestorswhoseportfolioscontaininvestmentsintheprivateprisonindustryorcontractorswhoprovideservicestoimmigrantdetentioncenters.Part1ofthisseries,“PrivatePrisons,ImmigrantDetentionandInvestmentRisks,”releasedinAugust2018,identifiesinvestmentmanagers,namelyhedgefundmanagers,whoinvestmillionsofdollarsincompaniesthatprofitfromdetentionfacilitiesthathouseseparatedimmigrantfamiliesandtherisksthoseinvestmentsposetoourmembers’retirementsecurity.Part2ofthisseriesfocusesonthecompaniesandassetmanagers,namelyprivateequityfirms,thatprofitfromandfuelthemassincarcerationofblackandbrownpeopleintheUnitedStates.TheUnitedStatesincarceratesmorepeoplethananyothercountryintheworld,bothintermsofthenumberofindividualsincarceratedandbypercentageofpopulation.iIn2016,therewereroughly2.2millionpeopleinthecountry’sprisonsandjails,and1inevery116adultsintheUnitedStateswasincarceratedii—aratefarhigherthancountrieswithmoreauthoritarianregimes,suchasRussia,thePhilippinesandIran.iiiIfthenumberofimprisonedindividualsintheUnitedStatesmadeupacity,itwouldbethefifth-largestinthecountry.ivThispracticeofshuntingasignificantportionofthepopulationintothecriminaljusticesystemisknownasmassincarceration,anditoverwhelminglyanddiscriminatorilyimpactscommunitiesofcolor.Althoughpeopleofcolormakeuponly30percentofthepopulation,theymakeup60percentoftheU.S.incarceratedpopulation.vTheAmericanCivilLibertiesUnionestimatesthat1outofevery3blackboysand1outofevery6Latinoboyscanexpecttogotoprisonintheirlifetimes—comparedwith1outofevery17whiteboys.viAccordingtotheNAACP,“IfAfricanAmericansandHispanicswereincarceratedatthesameratesaswhites,prisonandjailpopulationswoulddeclinebyalmost40%.”viiThisracialdivideinincarcerationratesisexacerbatedbypoverty.A2015reportbythePrisonPolicyInitiativestatesthat“theAmericanprisonsystemisburstingattheseamswithpeoplewhohavebeenshutoutoftheeconomyandwhohadneitheraqualityeducationnoraccesstogoodjobs,”notingthatthemedianannualincomeofU.S.inmatespriortoincarcerationisonlyabout$19,000.viiiSocio-economicstatusplaysasignificantroleindeterminingwhethersomeonewillexperienceincarceration,ixyetracialdisparitiesinincarcerationratesandsentencingpersist,withadisproportionatelynegativeimpactonAfrican-Americanmeninparticular.xTheAFTbelievesthatcombatingmassincarcerationisavitalcivilrightsandhumanitarianissue—andasthisreportdemonstrates,itisalsoaninvestmentissue.That’swhytheissueofprivateprisonsisnowsubjecttoariskanalysis,somethingtheAFThasdoneperiodicallysince2013,toprovideinformation,forthepurposeoftransparencyandeducation,topensionfundtrustees.In2015,theAFT’sRacialEquityTaskForcereleasedareport,“ReclaimingthePromiseofRacial

This report aims to address one of the factors that lead to mass incarceration: the growth of the private prison industry.

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Equity,”thatcalledfortheunionandalliesto“worktocombatfactorsthatleadtothemassincarcerationofyoungblackmales.”This“RankingAssetManagers”reportaimstocombatoneofthosefactors:thegrowthoftheprivateprisonindustry,whosebusinessmodeldependsonincreasingthenumberofpeopleindetention,oftenunderconditionsthatviolatetheirhumanrights.Asnearlytwo-thirdsofprisonersareblackandLatino,xithepushtoincarceratelargernumberswillundoubtedlyleadtofurtherdisproportionateincarcerationofpeopleofcolor.ThemassincarcerationcrisisisfeltdeeplybyAFTmembers.TheNationalResourceCenteronChildrenandFamiliesoftheIncarceratedatRutgersUniversityestimatesthatmorethan2.7millionchildrenintheUnitedStateshaveanincarceratedparent,orabout1in28children;44-55percentoffathersinprisonand64-84percentofmothersinprisonhadatleastoneminorchildlivingwiththembeforeincarceration.xiiBecausemorethanhalfofallincarceratedparentswerethebreadwinnersfortheirfamilies,childrenwithincarceratedparentsaremorelikelytoexperiencepovertyandhousinginstability,xiiibothofwhichcandisruptlearning.AccordingtotheEconomicPolicyInstitute,childrenofincarceratedparentsaremorelikelytodropoutofschool,developlearningdisabilitiesandsufferfromailmentssuchasasthma,anxiety,post-traumaticstressdisorder,migrainesanddepression,leadingEPItoconcludethat“criminaljusticepolicyiseducationpolicy.”xivFurthermore,the“zerotolerance”disciplinepoliciesthatschoolspreviouslyadoptedhadtheeffectofcriminalizingstudents,withadisproportionateeffectonstudentsofcolor,whofacegreaterratesofsuspension,expulsionandbeingbroughtuponcriminalcharges.Theeffecthasbeenstudentsleavingpublicschools,whichprovidethesupportandresourcestheyneed.xvClearly,themassincarcerationcrisisimpactseducatorsandthestudentstheyteach—andthecrisisisfueledinpartbycompaniesthatprofitfromtheincarcerationofcommunitiesofcolor.Large,for-profitprisonoperatorslikeCoreCivicandtheGEOGroup,alongwithanumberofsmallercompaniesownedbyprivateequityfirmsthatprovidecorrections-relatedsupportservices,togethermakebillionsofdollarsannuallywhendisproportionatenumbersofblackandLatinopeoplearesenttoprison.That’swhymassincarcerationisnotonlyaracialjusticeandcivilrightsissue—itisalsoaninvestmentissue.Alargenumberofpublicpensionfunds,alongwithotherinstitutionalinvestors,havetensofmillionsofdollars’worthofexposuretotheprivateprisonindustrythroughtheirinvestmentportfolios,whetherthroughdirectlyownedsharesofpubliclytradedprivateprisoncompanies,indirectexposurethroughhedgefundsorindexfunds,orinvestmentsinprivateequityfirmsthatowncompaniesprovidingcorrections-relatedservices.Privateprisoncompaniesandcompaniesthatprovideoutsourcedservicestocorrectionalfacilitieshavenoincentivetoaddresstheproblemofmassincarceration,becausetheystandtomakemoremoneywhenmoreindividualsareincarcerated.Infact,privateprisoncompaniesactivelycontributetothecurrentsystemofmassincarcerationthroughpoliticalexpenditures,policydevelopmentandlobbying.Thesecompaniesdo,however,haveanincentivetocutcostsinordertomaximizetheirprofits,and,asthisreportwilldemonstrate,manyachievethisbyloweringwagesforworkers,understaffing,skimpingontrainingandprovidingaslittleservicesaspossibletoinmates—attimesbreakingthelawandattheexpenseofinmates’health,safetyandlives.Thelitigation,regulatoryandheadlinerisksthatresultfromtheabusesoftheprivateprisonandcorrectionsservicesindustries,therefore,aresignificant.Anumberofpublicpensionfundshavealreadytakenstepstomitigatemassincarcerationrisks,withthreeofthefourlargestpublicpensionfundsintheUnitedStates—theCaliforniaStateTeachers’RetirementSystem,theNewYorkCityEmployees’RetirementSystemandtheNewYorkStateCommonRetirementFund—divestingfromdirectholdingsinprivate

The investment risks that result from the abuses of the private prison and corrections services industries are significant.

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prisoncompaniesoverthelasttwoyears.TwootherfundsinwhichAFTmembersparticipate—theChicagoTeachers’PensionFundandtheNewJerseyStateInvestmentCouncil—alsovotedtodivestfromprivateprisoncompaniesinrecentmonths,indicatingagrowingrecognitionamongpensionfundsthatprivateprisoninvestmentsposeseriousinvestmentriskstoworkers’retirementsavings.Accordingly,thisreportwill:

1. Identifytheprincipalcompanies,bothpubliclytradedandprivateequityowned,thatprofitfrommassincarceration;

2. Outlinetheriskstoinvestorsposedbythesecompanies;

3. Providea“watchlist”ofprivateequityfirmsthatowncompaniesthatprovideservicestoprisons,jailsanddetentionfacilities;

4. Callonpublicpensionfundstoassesstheirdirectandindirectexposuretothesecompaniesandasset

managersandassesstheriskstheyposetothefund;and

5. Provideactionstepsforpensionfundtrusteestomitigatetheseinvestmentrisks.

Steps Pension Funds Have Taken to Address Mass Incarceration Investment Risk

Severalpensionfundshavedivestedfromtheprivateprisonindustryoverthelastseveralyears,includingtheNewYorkCityEmployees’RetirementSystem,theNewYorkStateCommonRetirementSystemandthePhiladelphiaBoardofPensionsandRetirements.xviSincethereleaseofPart1ofthisreportinAugust2018,thefollowingadditionalpensionfundshavetakenstepstodivestfromprivateprisons:

• OnAug.17,2018,theChicagoTeachers’PensionFundaddedimmigrantdetentioncentersandotherprivateprisonoperatorstoitslistofprohibitedinvestments.SaidfundPresidentJayC.Rehak:“Weknowtheseinstitutionsdisproportionatelyincarceratepeopleofcolorandthosewholivebelowthepovertyline,houseimmigrantchildrenandperpetuatetheseparationofimmigrantfamilies.[Furthermore,thesecompanies]takeadvantageofandputatriskunprotected,low-wageemployees,whilelackingfiscalandoperationaltransparency.”xviiAddedChicagoTeachersUnionPresidentJesseSharkey:“Ourunionmembersservetensofthousandsofimmigrantstudentsinourschools,andwe’recommittedtotakinganyandallstepstoprotecttheirfamiliesfromdisruptionorrepression.Thatincludesourrefusaltosupportcorporationsthatseektoprofitfromthenationalattackonimmigrants—thesamecorporationsthatcontinuetoprofitfromthemassincarcerationofblackpeopleandtheharmthatcontinuestovisitthefamiliesofourblackstudents.”xviii

“I am a grandmother of 17, and all my children and grandchildren have been or are in Chicago Public Schools. I fully supported the Chicago Teachers’ Pension Fund’s decision to take their money out of private prison companies that are harming our communities. These companies see people as dollar signs, nothing more.”

—Irene Robinson, Journey for Justice member, Chicago

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• OnAug.31,2018,theNewJerseyPensionFunddivesteditsstakeintheGEOGrouptotaling$1.3million,stating

“Ourdivisionofinvestmentreviewedtheinvestmentmerits,includingconsiderationofenvironmental,socialandgovernanceissues,andconsistentwithitsfiduciaryresponsibilityelectedtosellthesecurity.”xix

• OnNov.8,2018,theCaliforniaStateTeachers’RetirementSysteminvestmentcommitteevotedtodivestalldirectlyheldsharesoftheGEOGroupandCoreCivicwithinsixmonths.ThedecisiontodivestfollowedmonthsofCalSTRS’heightenedengagementwiththeGEOGroupandCoreCivicregardingtheirbusinesspractices,whichincluded“visitstovariousdetentionfacilitiesandface-to-facemeetingswithseniormanagementconcerningoperationalprocessesandriskmanagementefforts,”accordingtothepensionfund,whichcitedrisksrelatedtohumanrightsviolationsofimmigrantsandchildrenofimmigrantsdetainedatthecompanies’facilities.xx

• InDecember2018,theCaliforniaPublicEmployees’RetirementSystem,thelargestpublicpensionfundinthecountry,announcedthatitwasengagingindialoguewithmanagementofCoreCivicandtheGEOGroup,aswellasdefensecontractorGeneralDynamics,aroundconcernsrelatedtothecompanies’involvementinimmigrantdetention.AccordingtoCalPERS’investmentpolicy,thepensionfundmustengagewithcompaniesontheirpoliciesbeforeholdingaformalvoteondivestment.xxi

Notably,mostpensionfundsthathavedivestedfromtheprivateprisonindustryhavedivestedtheirdirectstockholdings,withtheexceptionoftheNewYorkStateCommonRetirementFund,whoseprivateprisondivestmentpolicyappliestoallassetclassesprospectively,meaningthatthefundscreensanynewassetmanager,includingprivateequityfunds,forexposuretotheprivateprisonindustry.Who Profits from Mass Incarceration? TheUnitedStateshasn’talwaysbeentheworld’slargestjailer.Mostoftheexplosioninthenumberofpeopleincarceratedhasoccurredonlyoverthelastseveraldecades,andcanbeattributedinparttothewarondrugs,whichofficiallycommencedintheearly1980s.Infact,accordingtotheSentencingProject,between1980and2016,thenumberofpeopleincarceratedfordrugoffensesincreasedmorethantenfold;in2016,thereweremorepeopleincarceratedfordrugoffensesthantherewereincarceratedforanycrimein1980.xxiiInDecember2018,theFirstStepAct—bipartisanlegislationmakingchangestosentencinglaws—wassignedintolaw,anditisexpectedtoresultinthousandsoffederalinmatesbecomingeligibleforsentencereductionsandearlyrelease;xxiiihowever,thislegislationdoesnotapplytothestateandlocalprisonsandjailsthatmakeupthebulkoftheU.S.criminaljusticesystem.xxivThus,whilethelegislationmaybeaninitialstepinloweringtheU.S.prisonpopulation,itdoesnothingtoaddresstheover-incarcerationof2millionnonfederalinmates,asignificantportionofwhomareservingsentencesfornonviolentdrugoffenses.xxvWhilethemassincarcerationofpeopleofcolorhashadadevastatingimpactonentirecommunities,thereareanumberofcompanies,bothpubliclyandprivatelyheld,thatseektoprofitfromtheimprisonmentofpeopleofcolor.Thesecompaniesrelylargelyoncontractswithlocal,stateandfederalgovernmentstobuild,manageandoperateprisons,orprovideancillary

“As a public school parent, I know teachers work hard to educate our children. We don’t want to see any of our children end up in prison, and it’s heinous that there are companies out there that think prisons are a good way to make billions of dollars. It’s time to rethink how our money is being invested. Our children are our future.”

—Maulana Tolbert, Journey for Justice member, Detroit

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services,suchashealthcareandcommunicationsservices,toprisons,andtheirgrowthdependsuponthegrowthoftheprisonpopulationintheUnitedStates.TheprivateprisonindustryintheUnitedStatesisdominatedbytwopubliclytraded,for-profitcompanies,whichtogetheraccountfornearly85percentoftheprivateprisonmarket:xxvi

• CoreCivic(formerlyCorrectionsCorporationofAmerica),thelargestprivateprisoncompanyintheUnitedStates,whichownsandmanagescorrectional,detentionandresidentialre-entryfacilitiesintheUnitedStates,totalingapproximately78,000bedsin19states.xxvii

• TheGEOGroup,whichownsandmanagescorrectionalanddetentionfacilitiesintheUnitedStates,Australia,SouthAfricaandtheUnitedKingdom,totalingapproximately75,000bedsin71facilities;xxviiiitisalsothelargestproviderofelectronicmonitoringservicesintheUnitedStates.xxix

About9percentofincarceratedpeopleintheUnitedStates—andnearly75percentofpeopleinimmigrantdetentionfacilities—arehousedinprivateprisons,xxxandthisnumberhasgrownsignificantlyoverthelasttwodecades.Between2000and2016,thenumberofpeopleincarceratedinprivateprisonsgrewfivetimesfasterthanthetotalprisonpopulation,andthenumberofpeopleinprivateimmigrantdetentioncentersincreasedbymorethan440percent.xxxiIn2017,CoreCivicearnedmorethan$22,000perinmate,xxxiiandtheGEOGroupearnedmorethan$24,000perinmate.xxxiiiWhilepublicandinvestordebatearoundtheprivatizationofprisons,jailsanddetentionfacilitieshaslargelyfocusedonpubliclytradedcompaniessuchasCoreCivicandtheGEOGroup,thefirmsthatprovidephoneservices,commissaryservices,medicalservices,bailbondsandothercorrections-relatedservicesareperhapsmoreubiquitous,servingthousandsofprison,jailanddetentionfacilitiesaroundthecountry.Thesefirmsarelargelyownedbyprivateequityfirms,whoseownersstandtoprofitfrommassincarceration—especiallyrecently,astheTrumpadministrationhasrampedupimmigrantdetention.MoredetailsonthesefirmsandthecompaniestheyownareprovidedinTable1.

Private Equity and Mass Incarceration Ahandfulofprivateequityfirms,drawingoncapitalfrompensionfunds,foundations,endowments,insurancecompaniesandotherinstitutionalinvestors,haveinvestedheavilyincompaniesprovidingservicestoprisons,jailsanddetentionfacilitiesaroundtheUnitedStatesandthemorethan2millionpeoplehousedatthosefacilities.Overthelastseveraldecades,local,stateandfederalgovernments,facingincreasingbudgetconstraints,haveoutsourcedanincreasingshareofprison-relatedservices,suchasmedicalcare,foodservices,telecommunicationsandparole/probationservices,toprivatecompaniesthatpromisetodelivertheseservicesinamorecost-effectivemanner.Unfortunately,whilethesecompaniesturnaprofitbypayingworkerslessandprovidingfewerandlowerqualityservicesthanpublicinstitutions,researchhasshownthattheseprivatizedservicescancostmorethangovernment-providedservices,evenconsideringthefactthatprivateprisonssometimesservehealthierandlesscostlyinmates.xxxivThisreportincludesawatchlistofsevenprivateequityfirmsthatowncorrectionscompaniesthatprofitfrommassincarceration(seeTable2below).Althoughprivateequityfirmsacquirecorrectionscompaniesinanattempttomakemoneyfortheirprincipalsandinvestors,thecost-cuttinginvolvedhasledtoallegationsthatsomeofthesecompaniesneglect,mistreatorabuseprisonersandtakeadvantageofthefamiliesoftheincarcerated,whichinturnposeslitigation,regulatoryandheadlineriskstoinvestors.

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Theproblemsthatcanresultfromprivatizedprisonserviceshavebeenwell-documented;belowarecasestudiesofthreeprivateequity-ownedcorrectionscompaniesandrelatedinvestmentrisks.Company:Wellpath(formerlyCorrectCareSolutionsandCorrectionalMedicalGroupCompanies)

Privateequityowner:H.I.G.Capital

• UntilOctober2018,CorrectCareSolutionswasownedbyatrioofprivateequityfirms,includingGTCR,theprivateequityfirmfoundedbyformerIllinoisGov.BruceRauner;whileRaunernolongerrunstheprivateequityfirm,hismostrecentfinancialdisclosuresindicatethathestillearnsmoneyfromhisinvestmentsinGTCR.xxxvOnOct.1,2018,H.I.G.CapitalannouncedthatithadacquiredCorrectCareSolutionsandwouldbemergingitwithanothercorrectionalhealthcarecompanyinitsportfolio,CorrectionalMedicalGroupCompanies.xxxviPriortothismerger,CorrectCareSolutionsprovidedmedicalandbehavioralhealthservicestolocal,stateandfederalcorrectionalfacilitiesin38states,reachingnearly250,000patients.xxxvii

• AccordingtotheDailyBeast,thereweremorethan140lawsuitsagainstCorrectCareSolutionsfiledbetween2005and2017.xxxviiiIn2017,FultonCounty,Ga.,terminateditscontractwiththecompanyafterfiveinmatesdiedwithinaspanof75days,withthecountyconcludingthattheonlyconnectionbetweenthedeathswasthefactthatalloftheinmateswerebeingtreatedbyCorrectCareSolutions.xxxix

• AlawsuitfiledinMay2018allegedthatmorethanadozeninmatesunderthecareofCorrectCareSolutionsweredeniedmedicaltreatmentforseriousailments,includingastroke,abrokenhipandlungcancer.Accordingtothelawsuit,thecompany’scontractwiththecountydetentioncentercreated“perverseincentives”becauseCorrectCareSolutions“makesmoremoneyunderthecontractwhentheyrefusetoprovideinmateswithnecessarymedicalcare.”xl

• AndinAugust2018,avideowasreleasedaspartofawrongfuldeathlawsuitagainstCorrectCareSolutionsthatshowedaninmateinaWestchester,N.Y.,countyjailcollapsingonthegroundandbeingwheeledbacktohiscellinawheelchairbyCorrectCareSolutionsstaff.Theinmatediedsoonafterfromaheartattack,andastatelegislatorconcludedthat“lookingatthisvideo,itwouldtakemorepersuasiontogetmetogoalongwiththepointofviewthatweshouldhaveCCSoranotherfor-profitentityrunningthemedicaldepartment[insidethejail].”xli

Company:CorizonHealthPrivateequityowner:BlueMountainCapitalManagement

• CorizonHealth,thenation’slargestcorrectionalhealthcarecompany,ownedbyprivateequityfirmBlueMountain

CapitalManagement,provideshealthcareservicesto220,000prisonersat301correctionalinstitutionsin22states.xliiAccordingtotheAmericanCivilLibertiesUnion,CorizonHealthhasbeennamedasadefendantinmorethan600malpracticelawsuitssince2011,includingallegationsofmedicalneglect.xliiiThecompanyhaspaidoutmillionsofdollarsinsettlementsovertheyears,includingarecord$8.3millionsettlementin2015foradetaineewhodiedafternotreceivinganintakeassessmentbyaregisterednurseasrequiredbystatelaw.xliv

• Inonerecentcase,aprisonerunderthecareofCorizonHealthdiedin2017fromararefungalinfectionafterreportingtroublingsymptomsformorethaneightmonths;accordingtothelawsuit,theinmatesuffereda“staggeringlyslow,physicallyandmentallyexcruciatingdeath.”xlvStatedoneexpertwitnessaboutCorizon,“They’reprivate,theirgoalistomakemoney,sotheyputpoliciesinplacethataren’tnecessarily[intended]tobenefitthepatient.”xlvi

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Company:Securus/JPay

Privateequityowner:PlatinumEquity

• Securusprovidestelecommunicationsservicestomorethan3,400correctionalfacilitiesintheUnitedStatesandCanada;xlviiin2015,thecompanyacquiredJPay,whichprovidesmoneytransfer,emailandvideovisitationservicestoinmatesin36statesandWashington,D.C.xlviii

• Thecompany’shighratesandfeeschargedtoinmatesandtheirfamilieshavebeenreportedintheNewYorkerxlixandtheGuardian.lIn2015,theFederalCommunicationsCommissionestablishedratecapsoninmatephonecalls,withonecommissionerpointingtoanexampleofafamilyofoneinmatethathadspent$28,000over10yearstocommunicatewithhim.liHowever,Securus,alongwithotherprisontelecommunicationscompanies,challengedtherule,liiandtheTrumpadministrationannouncedin2017thatitwouldnolongerdefendtheFCC’sruling,liiigivingprisontelecommunicationscompaniesanopeningtochargeexorbitantratesgoingforward.

• Inadditiontoallegationsofoverchargingitscaptiveconsumerbase,Securushasalsomadeheadlinesforallegedillegalactivity.Earlierthisyear,alawsuitwasfiledallegingthatthecompany’sagreementwithBristolCountyinMassachusettsinvolvedanillegalkickbackarrangementthatresultedinthecostofphonecallsfromthecountyjailsnearlydoubling.livIn2016,Securussettledalawsuitallegingthatthecompanyillegallyrecordedprivilegedandconfidentialconversationsbetweeninmatesandattorneysandthenprovidedtheserecordingstoprosecutors.lvAndinJanuary2018,aformerinmatefiledaproposedclass-actionlawsuitagainstJPay,allegingthatthecompany’spolicies,includingchargingamonthly$3maintenancefeeanda$1ATMdeclinefeeforinmatesandformerinmatestoaccesstheirmoney,aremonopolisticandillegal.lvi

• Securus,alongwithothercorrectionaltelecommunicationsproviders,hasalsopushedonlinevideovisitationasanalternativetoin-personvisitationofinmates,includingwritingbansofin-personvisitsintoitscontractswithfacilities.lviiWhilethiscertainlyhastheeffectofdrivingmorebusinesstovideovisitation,whichcancostusers$1perminute,comparedwithfreein-personvisits,lviiiitalsohasanegativeimpactonprisoners:Researchhasshownthatin-personvisitsreducesubsequentcrimeandrecidivism.lixPerhapsduetogrowingpublicoutcryoverthispractice,in2015Securusstatedthatgoingforwarditwilldefertoitsclients’policyonvisitation.lx

Asthesecasesillustrate,theprivatizationofpublicservicesintroducesaprofitincentivethatcanresultincompaniestakingextrememeasurestocutcosts—puttingemployeesandinmatesatriskintheprocess.SomeAFTmembershavewitnessedfirsthandthedangersthatcanoccurwhentheirjobsareprivatized.In2013,theMilwaukeeCountyJailinWisconsinhiredaprivatecompany,ArmorCorrectionalHealthServices,toprovidehealthservicesatthejail,replacingtheunionizedregisterednurses,membersoftheWisconsinFederationofNursesandHealthProfessionals.

“As a public school parent who works closely with teachers who serve black and brown children, I know the devastating impact that mass incarceration has on classrooms and on families. Private prison companies make headlines all the time for the way they cut corners and put workers and inmates at risk—and it’s hurtful to think that they profit by putting people behind bars.”

—Angel Gober, Journey for Justice member, Pittsburgh

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Upon taking over healthcare services at the jail, Armor began slashingstaffinglevels,withaformerWFNHPmemberdescribingArmor’sapproachas“anaccidentwaitingtohappen.”In2016,fourinmatesdiedinthejailoverthecourseofjustafewmonths,includingthechildofaninmatewhohadgivenbirthinjaillxiandaninmatewhodiedofdehydrationafterbeingdeniedwateraspunishment.lxii

AsreportedintheMilwaukeeJournalSentinel,“TheprivatecontractorresponsibleformedicalcareatMilwaukeeCounty’sjailshasfailedtomeetbasicstandardsofcareandstaffingmandates,”withArmorfailingtofill30percentofallmedicalpositionsatthejail.lxiiiIn2018,MilwaukeeCountyprosecutorsbroughtcriminalchargesagainstArmorforfalsifyinghealthrecords.lxiv

The AFT represents public employees who work in a variety of professions, including corrections officers and parole and probation officers who work in prisons and with the formerly incarcerated every day. As a result, these workers understand the criminal justice system and are strong advocates for fair and equal treatment for prison workers and the incarcerated. AFT public employees recognize that private prison companies put both public safety and public employee pensions at risk, and believe that privatizing our justice system threatens our democracy.

Fiduciary Arguments for Divestment

Itiswellwithinthescopeofapensionfundtrustee’sfiduciaryresponsibilitytoconsiderthelegitimaterisksassociatedwithinvestmentsintheprivateprisonindustry,andtoconsiderwhethertodivestentirely.CoreCivicandtheGEOGrouprelyonincarceratingpeopletoturnaprofitand,therefore,haveanincentivetoforgospendingtoensurethehealthandsafetyofthoseincarceratedinordertoincreasepayoutstoshareholdersandexecutives.Thereareclearfinancial,headlineandregulatoryrisksassociatedwithinvestinginthesecompanies:

• A2016reportfromtheJusticeDepartment’sinspectorgeneralrevealedthatprivatelyoperatedfederalprisonsaremoredangerousthanfederallymanagedprisons,withhigherratesofassaults.lxvThisisevidentinthenumerouslawsuitsagainstCoreCivicandtheGEOGroup,includingalawsuitallegingthatunderstaffingataCoreCivicfacilityinIdaholedtoinmatesbeingbeatenandstabbedbymembersofaprisongang,lxviandalawsuitinwhichafederaljudgeruledin2012thataGEOGroupfacilityinMississippifailedtoprotectinmatesfromgangviolence.lxvii

• BecauseprivateprisoncompaniesdonothavetorespondtorequestsforinformationundertheFreedomofInformationAct,itisdifficultforinvestorsandthepublictoaccessclearinformationregardingconditionsandpossibleabuses.lxviiiThiscanresultinheadlineriskstoinvestorswhentheseissuesbecomepublic—forexample,theGuardianreportsthatoverthelastyear,fourdifferentlawsuitshavebeenfiledallegingthatthecompanies“violatedthefederalTraffickingVictimsProtectionActbythreateningsolitaryconfinementorwithholdingbasicnecessities,suchasfood,toiletpaperandsoap,ifdetaineesrefusedtowork”atfiveCoreCivicfacilitiesandoneGEOGroupfacility.lxix

• Privateprisoncompaniesfacevulnerabilitytopoliticalchangesbecauseofthehumanitarianissuesassociatedwiththeirbusiness.Forexample,in2016theObamaadministrationannounceditwouldphaseouttheuseofprivateprisonsforfederaldetainees,andin2017theTrumpadministrationreversedthedecision.lxxAndinDecember2018,theFirstStepActwassignedintolaw,lxxiwhichisexpectedtoleadtothousandsoffederalnonviolentdrugoffendersqualifyingforearlyreleaseorreducedsentences.lxxiiInanotherexampleofhowprivateprisonsaresubjecttopoliticalevents,inJanuary2019,afederaljailinBrooklyn,N.Y.,experiencedanelectricalfailure,leavingmorethan1,000inmateswithminimalheatandnolightsintheircellsforatleastaweek.Thepowerfailurehappenedduringthefederalgovernmentshutdown,whichimpededlawyers’abilitytomeetwiththeirclientsatthejailandmonitorthesituation.lxxiii

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• Similarly,changestofederalpoliciescanimpactcorrectionscompanies’bottomlines.Forexample,theFCC’sdecisiontocapprisonphonecallratesin2015,anditssubsequentreversalin2017,illustratesjusthowvulnerableprisontelecommunicationscompaniesaretopoliticalwindshifts.

• Harmfulpracticesonthepartofcorrectionscompanies—particularlythosethatgeneratelawsuitsand/ormediaattention—canleadstatestoterminatetheircontracts,compoundingfinancialriskstoinvestors.AtleastfivestateshavecanceledcontractswithCorizonHealthoverthelastseveralyears,includingIndiana,whichterminateditscontractnotlongaftertheSouthBendTribunereportedthatthecompanyfaceddozensoflawsuitsinthestate,includingallegationsofwrongfuldeath.lxxv

• Asoutlinedabove,prisonhealthcarecompaniesfaceanumberoflawsuitsallegingmistreatmentofprisoners,withholdingofcareandwrongfuldeath.Theselawsuitscanresultinsettlementsorjudgementscompellingthecompanytopaymillionsofdollars,posingafinancialrisktoinvestorsinadditiontoheadlinerisks.

Private Equity Watch List

TobeincludedinourwatchlistinTable2,aprivateequityfirmmusthavereportedownershipofacompanyforwhichasignificantportionofbusinessisderivedfromprovidingservicestocorrectionalfacilities.Thislistisnotacomprehensiveoverviewofallprivateequityownershipofcorrectionscompanies,andprivateequityportfoliosaresubjecttochange.

InadditiontoreviewingtheirportfoliosfordirectholdingsofCoreCivicandtheGEOGroup,weencouragepensionfundtrusteestoreviewtheirportfoliosforexposuretoprivateequityfirmsincludedinthisreportandtoconsultourwatchlistwhenmakingassetallocationdecisions.

Furthermore,pensionfundtrusteesshouldraiseconcernswithanyprivateequitymanageronthiswatchlistwithwhichtheirpensionfundiscurrentlyinvestedorconsideringinvesting,includingaskingthemtotakemeaningfulstepstoaddresstherisksassociatedwiththecorrectionscompaniesintheirportfolios,toremovecorrectionscompaniesfromtheirportfoliosandtocommitpubliclytonotinvestinginprivateprison-relatedholdings.Pensionfundtrusteesshouldalsoconsiderdivestingfromcompaniesthatfailtotakestepstoensuretheirbusinesspracticesdonotcontributetotheproblemofmassincarcerationandthatputprisoners,theirfamiliesandcommunitiesatrisk.

WealsourgepensionfundstoconsideradoptingcomprehensivepoliciessimilartothatoftheNewYorkStateCommonRetirementFundthatprohibitnewexposuretoprivateprisonsinanyassetclass,and/orpoliciesthatrestrictinvestmentsinprivateequityfirmsorothercompaniesthatprivatizepublicjobs.Forfurtherrecommendationsforpensionsandemployeebenefitplans,see“WhatCanPensionFundTrusteesDo?”below.

“I find it immoral that a company could make money off of something that affects people’s lives so deeply.”

—Eric Olson, Colorado WINS (Workers for Innovative

and New Solutions) member

Privateequity-ownedcompaniesthatprivatizecorrectionsservicespresentmanyofthesesameinvestmentrisks—includingregulatory,litigationandheadlinerisks:

• Changestostatelawscanimpactthesecompanies’abilitytooperate;forexample,Californiarecentlypassedlegislationoutlawingcashbail,lxxivwhichcouldhaveasignificantimpactoncompaniessuchasAladdinBailBonds,particularlyifotherstatesfollowsuit.

10

What Can Pension Fund Trustees Do? Weurgepensionfundtrusteeswishingtoconsiderexposuretotheprivateprisonindustryaspartoftheirinvestmentdecision-makingprocesstoconsidertakinganyorallofthefollowingmeasures:

1. Consultourwatchlistwhenmakingassetallocationdecisions.

2. Reviewyourpensionfund’sinvestmentportfoliosforexposuretoprivateprisonandcorrectionscompaniesinpublicandprivatemarketsacrossallassetclasses.

3. Directyourpensionfundstafftoevaluatetheimpacttothefundofdivestingfromtheprivateprison

industry,andconsiderdivestingfromdirectlyownedshares.Similarly,askyourindexfundproviderandconsultanttoundertakeananalysisoftherisk-and-returnprofileofindexfundsthatdonotholdcompaniesintheprivateprisons/correctionsindustries,andconsiderinvestinginindexfundsthatdonothavethisexposure.

4. EngagewithCoreCivicandtheGEOGrouptodemandthattheyadoptpoliciestoensurejustandhumane

treatmentofdetaineesandproperoversightoverthecorrectionscompaniesprovidingservicestoinmateswhoareincarceratedintheirfacilities.Considerfilingorsupportingshareholderproposalsthatemphasizethesedemands.

5. Engagewithprivateequitycompaniesinyourportfoliothatowncorrectionscompaniesandaskwhatsteps

theyaretakingtoaddresstheinvestmentrisksassociatedwiththesecompanies.Mandatesimilarengagementwithprivateequityfirmsthataresolicitingneworadditionalinvestmentsfromyourpensionfund.Fornewprivateequityagreements,includeprovisionssimilartothoseadoptedbyCalSTRSregardingfirearmsmanufacturersthatexcludeinvestmentsincorrectionscompanies,andprotectyourfundwithopt-outoptionsshouldsuchinvestmentsoccur.

6. Developandadoptinvestmentbeliefsorotherpoliciesthatrestrictinvestmentsintheprivate

prisons/correctionsindustryspecificallyandincompaniesinvolvedinhumanrightsabusesmorebroadly.Aspartofthisprocess,reachouttopublicpensionfundsthathavealreadytakenactiontodivestfromprivateprisonstolearnabouttheirdecision-makingprocessandtoaccesspolicylanguagethatmayserveasaguideforyourownfund.

7. Developandadoptpoliciesprohibitinginvestmentsinfirmsthatprivatizepublicsectorjobs;considerusing

theCalPERSinvestmentpolicyonrestrictingprivateequityinvestmentsinpublicsectoroutsourcersasamodelpolicyforyourownpensionfund.

8. Investigatethecompaniesandprivateequitymanagersnamedinthisreportandtheircompliancewith

yourfund’sbeliefsifyourpensionfundhasalreadyadoptedinvestmentbeliefsthatapplyacrossassetclasses,andrequestthatstaffproduceandsharecompliancereportsonthesubject.

9. Supportstate-levellegislationrequiringgreatertransparencyanddisclosurefromcompaniesthatprofit

frommassincarceration,and/orlegislationbanningtheprivatizationofcorrectionalservices.

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Conclusion Asthisreportclearlydemonstrates,companiesthatprofitfrommassincarceration—includingpubliclytradedprivateprisoncompaniesandprivateequity-ownedcorrectionsservicescompanies—makemillionsoffofthecriminalizationandincarcerationofcommunitiesofcolor.However,thesemillionscomewithsignificantregulatory,litigationandheadlineriskstoinvestors.MassincarcerationofblackandbrownpeopleintheUnitedStatesisacivilrightsandhumanitarianissuethatimpactscommunitiesacrossthecountry,includingplaceswhereAFTmembersliveandwork.TheAFTiscommittedtoworkingtogetherwithouralliestoputanendtomassincarcerationsothatnochildorfamilyweservehastoenduretheinjusticeofthispractice,andsothatfor-profitcorporationscannolongerenrichthemselvesoffoflockingupcommunitiesofcolor.

Specialnotetoprivateequitymanagers:Ifyoufeelthatyourfundhasbeenplacedintheincorrectcategory,pleaseletusknow.ContacttheAFT’sCenterforWorkers’BenefitsandCapitalStrategiesateither202-585-5817oraftresearch@aft.org.

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Table 1: Private equity-owned firms providing services to prisons, jails and detention facilities DatacompiledbythePrivateEquityStakeholderProject.

Company Industry/Service Scope PrivateEquityOwnerSecurus/JPay Telephone/

CommunicationsSecurus,whichownsJPay,servesmorethan3,400publicsafety,lawenforcementandcorrectionsagenciesandmorethan1.2millioninmatesacrossNorthAmerica.lxxvi

PlatinumEquitylxxvii

GlobalTelLink Telephone/Communications

GlobalTelLinkservesapproximately2,300facilitiesand1.8millioninmatesin50states,theDistrictofColumbiaandPuertoRico.lxxviii

AmericanSecuritieslxxix

KeefeGroup/TrinityServicesGroup/SwansonServices/ICSolutions

Commissary/Food/Telephone/Communications

KeefeCommissaryNetworkservesmorethanhalfamillioninmatesweeklyand12outof14outsourcedstatedepartmentsofcorrections.lxxx

TelecommunicationsproviderICSolutionsserves180,000inmateshousedinmorethan200correctionalfacilitiesnationwide.lxxxi

H.I.G.Capitallxxxii

AladdinBailBonds/SeaviewSurety

Bail Aladdinisthelargestretailpre-trialreleaseserviceproviderintheUnitedStates.lxxxiii

EndeavourCapitallxxxiv

CorizonHealth Healthcare CorizonHealthprovideshealthcareservicestomorethan220,000prisonersat301correctionalinstitutionsin22states.lxxxv

BlueMountainCapitalManagementlxxxvi

Wellpath

(FormerlyCorrectCareSolutions/CorrectionalMedicalGroupCompanies)

Healthcare/Probation

Wellpathprovidesmedicalandbehavioralhealthservicesformorethan275,000patientslocatedinlocal,stateandfederalcorrectionalfacilities,aswellasstatehospitalsandotherfacilities.ItacquiredcompetitorCorrectionalMedicalGroupCompaniesinOctober.lxxxvii

H.I.G.Capital

Attenti ElectronicMonitoring

Attentiisaglobalproviderofelectronicmonitoringtechnologies,servinghundredsofnational,federal,stateandlocalcorrectionalandlawenforcementagenciesaroundtheworld.lxxxviii

ApaxPartners

SentinelOffenderServices

Probation SentinelOffenderServicesisaprivateprobationcompanythatpartnerswithcommunitycorrections,courtsandlawenforcement.lxxxix

BisonCapitalAssetManagementxc

Theinformationcontainedintheabovetableattemptstoidentifymajorprivateequityfirmsthatowncompaniesinthecorrectionsindustryandmaynotbecomprehensive.TheCorrectionsAccountabilityProjectmaintainsadatabaseofprivateownershipofcorrectionscompaniesthatmayprovideadditionalinformation.

13

Table 2: Asset manager watch list

PrivateEquityFirm CorrectionalCompaniesOwned

AmericanSecurities GlobalTelLink

ApaxPartners Attenti

BisonCapitalAssetManagement SentinelOffenderServices

BlueMountainCapitalManagement CorizonHealth

EndeavourCapital AladdinBailBonds/SeaviewSurety

H.I.G.Capital KeefeGroup/TrinityServicesGroup/SwansonServices/ICSolutionsWellpath

PlatinumEquity Securus/JPay

14

Table 3: Public pension fund ownership of CoreCivic and the GEO Group, as of

Jan. 21, 2020*

This data comes from the most recent available Form 13F filings made with the Securities and Exchange Commission.

Pension Fund CoreCivic Shares

Owned (1,000s)

GEO Group Shares

Owned (1,000s)

Alaska Retirement Management Board 53 54

Arizona State Retirement System 74 76

Colorado Public Employees’ Retirement Association 20 21

Louisiana State Employees’ Retirement System 29 29

Michigan Department of Treasury (Investment Management) 35 35

Municipal Employees’ Retirement System of Michigan 22 22

New Mexico Educational Retirement Board 21 21

New York State Teachers’ Retirement System 198 146

Ohio Public Employees Retirement System 192 104

Oregon Investment Council 49 50

Pennsylvania Public School Employees’ Retirement System 21 21

Retirement Systems of Alabama 155 158

State Board of Administration of Florida Retirement System 83 99

State Teachers Retirement System of Ohio 138 137

Teachers’ Retirement System of the State of Kentucky 19 22

Tennessee Consolidated Retirement System 78 86

Utah Retirement Systems 34 20

* Share ownership subject to change. This table was updated in January, 2020, to remove California Public Employees’ Retirement System,

California State Teachers’ Retirement System, Employees’ Retirement System of Texas, Illinois State Board of Investment, New Jersey

Division of Investment and South Dakota Investment Council, which as of January 21, 2020 did not report owning shares of CoreCivic and

GEO Group.

15

ihttp://www.prisonstudies.org/highest-to-lowest/prison_population_rate?field_region_taxonomy_tid=Alliihttps://www.bjs.gov/content/pub/pdf/cpus16.pdfiiihttp://www.prisonstudies.org/highest-to-lowest/prison_population_rate?field_region_taxonomy_tid=Allivhttps://www.cnn.com/2018/06/28/us/mass-incarceration-five-key-facts/index.htmlvhttps://www.americanprogress.org/issues/race/news/2012/03/13/11351/the-top-10-most-startling-facts-about-people-of-color-and-criminal-justice-in-the-united-statesvihttps://www.aclu.org/issues/smart-justice/mass-incarcerationviihttps://www.naacp.org/criminal-justice-fact-sheetviiihttps://www.prisonpolicy.org/reports/income.htmlixhttps://www.peoplespolicyproject.org/2018/01/30/mass-incarceration-new-jim-crow-class-war-or-bothxhttps://www.npr.org/2017/11/25/566438860/research-finds-racial-disparities-in-prison-sentencesxihttps://www.americanprogress.org/issues/race/news/2012/03/13/11351/the-top-10-most-startling-facts-about-people-of-color-and-criminal-justice-in-the-united-statesxiihttps://nrccfi.camden.rutgers.edu/files/nrccfi-fact-sheet-2014.pdfxiiihttps://prospect.org/article/mass-incarceration-and-achievement-gapxivhttps://www.epi.org/publication/mass-incarceration-and-childrens-outcomesxvhttps://www.aclu.org/issues/juvenile-justice/school-prison-pipelinexvihttps://www.aft.org/sites/default/files/invest-risks-prisons-detention-2018.pdfxviihttps://www.usnews.com/news/top-news/articles/2018-08-17/chicago-teachers-pension-fund-divesting-from-private-prisonsxviiihttps://www.aft.org/press-release/afts-weingarten-and-ctus-sharkey-chicago-teachers-pension-funds-divestmentxixhttp://www.pionline.com/article/20180831/ONLINE/180839963/new-jersey-pension-fund-divests-13-million-stake-in-private-prison-companyxxhttps://www.pionline.com/article/20181108/ONLINE/181109890/calstrs-to-divest-from-private-prison-companies-corecivic-geo-groupxxihttps://www.ai-cio.com/news/calpers-engages-private-prison-companiesxxiihttps://www.sentencingproject.org/criminal-justice-factsxxiiihttps://www.nytimes.com/2018/12/18/us/politics/senate-criminal-justice-bill.html?login=email&auth=login-emailxxivhttps://www.vox.com/future-perfect/2018/12/19/18148413/first-step-act-senate-criminal-justice-reform-sweeping-overhaulxxvhttp://nymag.com/intelligencer/2018/12/first-step-act-skepticism.htmlxxvihttps://www.houstonchronicle.com/business/article/Companies-earn-billions-to-shelter-immigrant-13044968.phpxxviihttp://ir.corecivic.com/static-files/f242d017-6ce3-4bb5-ae33-f6888059dc9bxxviiihttp://www.snl.com/Interactive/newlookandfeel/4144107/2017-GEO-Annual-Report.pdfxxixhttps://www.geogroup.com/Electronic_Monitoringxxxhttps://www.sentencingproject.org/publications/private-prisons-united-statesxxxihttps://www.sentencingproject.org/wp-content/uploads/2018/07/Capitalizing-on-Mass-Incarceration.pdfxxxiiBasedonCoreCivic’s2017revenue-per-bedcount:http://ir.corecivic.com/financial-information/annual-reportsxxxiiiBasedontheGEOGroup’s2017revenue-per-bedcount:http://www.snl.com/Interactive/newlookandfeel/4144107/2017-GEO-Annual-Report.pdfxxxivhttps://www.nytimes.com/2011/05/19/us/19prisons.htmlxxxvhttps://www.politico.com/story/2018/07/09/illinois-governor-detention-centers-702293xxxvihttps://higcapital.com/news/release/1128xxxviihttp://www.correctcaresolutions.com(accessedSept.8,2018)xxxviiihttps://www.thedailybeast.com/prison-health-care-provider-sued-140-times-now-blamed-for-at-least-six-deathsxxxixhttps://www.myajc.com/news/local/county-end-morehouse-contract-for-inmate-care-after-die/Yl9HFCFVleAu8RT98wSjdLxlhttps://www.apnews.com/48a70553a2b54df3a75892a7b2819182xlihttps://www.nbcnewyork.com/news/local/I-Team--Westchester-Looks-for-New-Jail-Healthcare-after-Video-shows-Inmate-Denied-during-Heart-Attack-492044891.htmlxliihttp://www.corizonhealth.com/About-Corizon/Locationsxliiihttps://www.newyorker.com/business/currency/making-profits-on-the-captive-prison-marketxlivhttps://www.mercurynews.com/2015/02/10/alameda-county-8-3-million-jail-death-settlement-mandates-jail-health-care-reformsxlvhttps://www.washingtonpost.com/news/post-nation/wp/2017/10/27/something-is-eating-my-brain-an-inmate-said-a-lawsuit-says-he-was-left-to-die/?noredirect=on&utm_term=.f87c7bd23eb7xlvihttps://www.kansascity.com/news/politics-government/article195673934.htmlxlviihttps://securustech.net/facilities-we-servexlviiihttps://www.jpay.com/PAvail.aspxxlixhttps://www.newyorker.com/business/currency/making-profits-on-the-captive-prison-marketl https://www.theguardian.com/commentisfree/cifamerica/2012/may/23/scandal-phone-call-price-gouging-prisonslihttps://www.theguardian.com/us-news/2015/oct/22/regulators-slash-price-prison-calls-fcc

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liihttps://docs.fcc.gov/public/attachments/DOC-341762A1.pdfliiihttps://qz.com/904925/donald-trumps-fcc-will-stop-fighting-exorbitant-prison-phone-call-rateslivhttps://www.bostonglobe.com/metro/2018/05/03/lawsuit-challenges-high-cost-calling-from-jail/q17v1CL0bZBhxOXd9qOBRP/story.htmllvhttps://theintercept.com/2016/03/16/securus-settles-lawsuit-alleging-improper-recording-of-privileged-inmate-callslvihttps://thinkprogress.org/prison-technology-companies-inmates-9d4242805363lviihttps://www.theatlantic.com/business/archive/2017/08/remote-video-visitation/535095lviiihttps://www.nytimes.com/roomfordebate/2014/02/23/does-video-visitation-help-prisons-and-families/video-visitation-could-exploit-prisoners-or-help-families-2lixhttps://www.vox.com/2015/10/22/9589052/prison-visits-recidivismlxhttps://www.prnewswire.com/news-releases/securus-technologies-revises-video-visitation-policy--defers-to-prisonjail-officials-on-rules-for-onsite-visits-300077180.htmllxihttp://archive.jsonline.com/news/baby-born-to-inmate-at-milwaukee-county-jail-does-not-survive-b99762131z1-386869111.htmllxiihttp://archive.jsonline.com/news/milwaukee/more-than-two-months-later-family-of-inmate-who-died-in-milwaukee-county-jail-has-no-answers-b997530-385486621.htmllxiiihttps://www.jsonline.com/story/news/investigations/2016/10/29/shortage-medical-staff-plagues-milwaukee-jails/92775782lxivhttps://www.jsonline.com/story/news/crime/2018/02/21/milwaukee-county-jails-health-care-contractor-charged-falsifying-inmate-records/359481002lxvhttps://www.aft.org/sites/default/files/invest-risks-prisons-detention-2018.pdflxvihttps://www.apnews.com/959feeb7469b473cbd08d9f60360be4flxviihttps://www.nytimes.com/2018/04/10/us/private-prisons-escapes-riots.htmllxviiihttps://www.aft.org/sites/default/files/invest-risks-prisons-detention-2018.pdflxixhttp://inthesetimes.com/features/ice_immigrant_detention_centers_forced_prison_labor_investigation.htmllxxhttps://www.npr.org/sections/thetwo-way/2017/02/23/516916688/private-prisons-back-in-mix-for-federal-inmates-as-sessions-rescinds-orderlxxihttps://www.theguardian.com/us-news/2018/dec/21/trump-prison-reform-first-step-act-signed-lawlxxiihttps://www.nytimes.com/2018/12/18/us/politics/senate-criminal-justice-bill.html?login=email&auth=login-emaillxxiiihttps://www.nytimes.com/2019/02/01/nyregion/mdc-brooklyn-jail-heat.htmllxxivhttps://www.politico.com/magazine/story/2018/08/29/california-abolish-cash-bail-reformers-unhappy-219618lxxvhttp://wfhb.org/news/indiana-dept-of-corrections-cancels-contract-with-healthcare-providerlxxvihttps://securustechnologies.tech/about(accessedSept.2,2018)lxxviihttps://www.platinumequity.com/our-portfolio/portfolio/2017/securus(accessedSept.3,2018)lxxviiihttp://www.gtl.net/about-us(accessedSept.2,2018)lxxixhttps://www.american-securities.com/en/companies/GTL(accessedSept.3,2018)lxxxhttps://www.keefegroup.com/companies/keefe-commissary-network-112(accessedSept.2,2018)lxxxihttps://www.keefegroup.com/companies/icsolutions-115(accessedSept.2,2018)lxxxiihttps://ecfsapi.fcc.gov/file/106121307119696/2018-06-12%20-%20Joint%20Application.pdf lxxxiii https://endeavourcapital.com/ec/the-aladdin-group(accessedSept.2,2018)lxxxivhttps://endeavourcapital.com/ec/the-aladdin-group(accessedSept.2,2018)lxxxvhttp://www.corizonhealth.com/About-Corizon/Locations(accessedSept.2,2018)lxxxvi“CorizonHealthcompletesrecapitalization”(mediarelease,April17,2017)lxxxviihttp://www.correctcaresolutions.com(accessedSept.2,2018);https://higcapital.com/news/release/1128 (mediarelease,Oct.1,2018)lxxxviiihttps://www.apax.com/investments/tech-telco/our-investments/attenti(accessedDec.19,2018)lxxxixhttps://www.businesswire.com/news/home/20180727005059/en/Sentinel-GTL-Form-Partnership-Provide-Offender-Tracking(mediarelease,July27,2018)xchttp://www.bisoncapital.com/portfolio(accessedSept.3,2018)

JOURNEY FOR JUSTICE ALLIANCE

The American Federation of Teachers would like to thank the Journey for Justice Alliance for

its continuing advocacy and organizing on education and racial justice issues. We would also

like to acknowledge the Private Equity Stakeholder Project’s work in engaging investors and

empowering communities, working families and others impacted by private equity investments.

We would like to thank the following organizations for supporting this report: