On October 22nd, the FCC finally stepped into a debate that could have wide-reaching effects on this nation’s criminal justice system. After many years of reticence, they finally issued a ruling clamping down on the exploitive practices of private companies providing telecommunications services to America’s prisons. The new FCC rules seek to cap fees for phone calls at the rate of $1.65 for 15 minutes, down from the existing rates, which, prior to 2013, could wind up being as high as $17. It will also prevent companies from rounding up calls to the 15-minute mark and prevent a variety of nonsensical system access fees (though not all).
Now those individuals who believe that the funds generated by these fees go to the running of the prisons themselves are in for a rude awakening. While DOCs in each state earn “commissions” from the companies, there are often serious questions regarding precisely what happens to those funds, with the system being exploited for the financial gains of prison officials (despite what many had hoped, the FCC ruling did not eliminate the practice, though some states have already done so on their own) But commissions aside, it’s important to remember that the companies providing communications services are for-profit entities and companies like Securus made over $100 million in profits last year, with a profit margin of 51%–a margin most companies can only dream of. And as recent reports revealed, Global Tel-Link dwarfs Securus in its market share.
Despite record profits, both these companies have stated their intentions to sue the FCC over the decision, stating that it would create “significant financial instability” and that it would “hurt inmates and their families—the very people they set out to help. While they might see lower per-minute rates, they could be left with either the lowest quality of phone service or no phone service at all.” Having read this quote a dozen times, I still fail to see how such a consequence could result from the decision. The irony of such a statement coming from companies whose entire mandates hinge on exploiting the poor and marginalized cannot be understated. They followed up this nonsensical statement with “cost savings from inmate pay phone calls will likely be extracted in some other form.” Indeed, their profit margins might drop a percentage or two—but given their professed compassion for the families of prisoners, surely they would be willing to sacrifice a few hundred thousand dollars from their $1 billion in gross annual earnings?
Although given the fact that last year Securus CEO Rick Smith testified to the FCC that “We don’t earn excessive profits,” I think we can all agree that those running these companies might be existing in a Bizarro World version of financial reality.
It’s also important to note that this regime extends to local jails, where such barriers can have a serious impact on those individuals incarcerated and awaiting trial or engaged in appeals. Financial obstacles can prevent a prisoner from fully participating in their own defense, having serious repercussions throughout the judicial process.
So last month’s decision is clearly a win for the rights not just of prisoners but for society as a whole. The next target in order to end this corrupt regime, however, must be the commissions (essentially a more polite term for kickbacks) demanded by prison officials in exchange for telecommunications contracts. Because as long as a for-profit motive is used to make decisions for public services, corruption—either intentional or not—is inevitable. Officials have claimed that commissions are necessary to pay for the monitoring of phone calls—yet such monitoring occurred prior to the kickback model of telecommunications. And analysts indicate that a regulatory regime change will, in fact, leave more than enough funds to do so.
As many have pointed out, facilitating communication with the outside world is absolutely critical in the battle to reduce recidivism; contact with family and loved ones is a crucial part of easing re-entry and creating the kind of social cohesion prisoners need to survive and thrive upon release.
So while Securus and GTL may gripe about the costs to their bottom line, society pays a far greater cost for their greed. I am certainly not the first, nor likely the last, person to wonder whether a company that preys upon the most vulnerable and seeks to weaken our society is, in fact, sitting on the correct side of the prison fence.
Published Nov 5, 2015 by Christopher Zoukis, JD, MBA | Last Updated by Christopher Zoukis, JD, MBA on Aug 6, 2023 at 11:11 pm