MOSCOW, September 30 (RIA Novosti) - JPay Inc. and other prison bankers collect millions of dollars every year from the families of inmates in fees for basic financial services, forcing many families to give up medical care, skip utility bills and cut down on contact with their imprisoned relatives, a study by the US Center for Public Integrity published Tuesday revealed.
“They’re punishing the families, not the inmates,” Pat Taylor, whose son is serving a 20-year sentence, told Public Integrity.
“To give him $50, I have to send $70 off my card,” she added, owing to transaction fees from prison bankers.
Her son, Eddie, is serving his 20-year sentence at the US Bland Correctional Center for armed robbery.
To send money, Taylor used to purchase a money order from the post office costing no more than $2 until JPay took over the financial handling of inmates raising her transaction costs to up to 35 percent of the amount sent.
Taylor therefore alternates between visiting and sending him money.
Further to the amount sent, another 15 percent is kept as a mandatory saving issued back up on the inmates release. The fee is directly deducted before the inmate receives the money sent by his family.
According to the study, inmates earn as little as 12 cents per hour putting millions of poor families in financial strain as they are forced to send additional money to their imprisoned relatives.
Other superfluous costs besides the prison bankers’ charges are the prices of vending machine goods and phone charges for which prisons take a share of the profits from the providers.
“It would be much harder to take money from families [without companies like JPay] and make families of inmates pay their own keep,” Lee Petro, an attorney who helped litigate phone rates in prisons, told Public Integrity.
JPay currently facilitates money transfers to nearly 70 percent of the inmates in US prisons with an estimated 7 million in revenues over 2013 and expects to make transfers worth $1 billion in 2014. 40 percent of families reported that this was the only means they could use for money transfer.
But the company claims that their charges are heightened by the security and software required in relation to prisons, according to phone interview Public Integrity had with the chief executive Ryan Shapiro.
Meanwhile, the New York Department of Financial Services’ is reviewing JPay as their charges still are much higher than other prison bankers such as NIC Inc., which charges a flat rate of $2.4 for transfers.
