Incarcerated people are uniquely vulnerable to junk fees.
Prison Policy Initiative updates for February 8, 2023 Exposing how mass incarceration harms communities and our national welfare
Incarcerated people must be at the forefront of Biden Administration and Federal Trade Commission efforts to end “junk fees” [[link removed]] We joined the National Consumer Law Center and 27 other organizations to call on the Federal Trade Commission to crack down on abusive fees incarcerated people and their families are forced to pay. [[link removed]]
by Mike Wessler
“ Junk fees [[link removed]],” those hidden charges attached to purchases or transactions, are something we’ve all faced. For those outside the prison walls, they are an inconvenience that may force them to find another company to do business with or grumble as they pay more for a product than they expected.
You can't truly address the worst impacts of junk fees without addressing how they harm incarcerated people and their families.For incarcerated people, though, there is no escape. They don’t have the option to use a different service or company. And their ability or inability to pay these fees often has dramatic consequences, determining whether they can stay in touch with a loved one or buy food at the commissary to supplement the paltry meals the prison provides. And considering the unconscionably low wages they earn for their labor [[link removed]], these fees are no minor inconvenience.
As part of a broader effort by the Biden administration [[link removed]], the Federal Trade Commission (FTC), an independent agency charged with protecting consumers and enforcing antitrust laws, is currently considering new measures [[link removed]] to crack down on these fees. This week, along with the National Consumer Law Center [[link removed]] and 27 other organizations, we explained to the agency that because of their low incomes and uniquely constrained position as consumers, providing incarcerated people relief from junk fees should be at the top of their list.
In an 18-page joint letter [[link removed]], this coalition highlighted some of the most abusive financial practices in prisons and jails and the ways incarcerated people are especially vulnerable to these junk fees.
Money transfers
As facilities increasingly shift the costs of incarceration to the people who are locked up, money plays a more important role than ever in the lives of people in prisons and jails. They now often have to pay for essentials like hygiene products, food, and paper from the commissary. As a result, many families have to send money to their incarcerated loved ones to help them make these purchases.
Sensing an opportunity for profit, companies have sprung up to facilitate these money transfers. Our 2021 analysis of this industry [[link removed]] found that these companies charge steep fees — up to 37% — and have complex pricing structures that make it hard to know exactly how much it’ll cost to send money to your loved one.
These fees are tough to justify at a time when services like Venmo and Zelle make transferring money outside of the prison walls easy and free.
Communication and technological services
As prison and jail phone rates recently came under increased scrutiny, the companies behind these services have evolved [[link removed]] to offer new services that have, thus far, largely evaded government regulation and oversight. As these companies moved into these unregulated industries, they packed their products with unfair and unclear fees that sap money from incarcerated people and their loved ones.
Electronic messaging: In recent years, electronic messaging [[link removed]] has exploded in popularity in prisons and jails. While the service has immense potential to strengthen connections between incarcerated people and their loved ones, unreasonably high costs and hidden fees have, thus far, made this yet another way for these companies to reap immense profits off the backs of some of the poorest people in society. Tablets: Similarly, so-called “free” tablets offer the promise of maintaining stronger connections to the outside by allowing incarcerated people to access music, videos, and other digital content, but are often little more than a tool to sap money from incarcerated people [[link removed]]. For example, one tablet provider charges incarcerated people a $14.99 fee for a 14-day digital music subscription. For comparison, Spotify’s standard price is $9.99 a month, and its most expensive plan, the “family plan” — which provides six accounts that can stream music at the same time — is only $15.99 a month.
Release cards
Even when a person is released, they’re still not free from the exploitative grasp of these companies, thanks to the advent of “release cards.” These prepaid debit cards, which we’ve covered extensively [[link removed]], are often given to people as they leave prison or jail. They’re loaded with any funds they had in their trust account — wages earned while behind bars, support from family members, or money the person had in their possession when arrested.
At first, this may sound like a convenient way to give someone their money when they’re released, until you learn of the complex and costly fees that quickly drain their value. This includes fees for:
Using your card for a purchase, Not using your card recently enough, Declined purchases, Using your card at the wrong ATM or bank, and Closing your account.
Often the only way to avoid these fees is by closing your account almost immediately upon your release, a time when you’re likely to be looking for stable housing and employment — things that are often necessary conditions for someone’s release to be approved.
Other junk fees in the criminal legal system
Our comment goes on to explain that beyond these services, junk fees are baked into the mass incarceration economy [[link removed]], with incarcerated people and their loved ones being subjected to fees for:
Commercial bail, Pretrial diversion programs, Private probation, Electronic monitoring, And more.
This push by the FTC and the Biden Administration to address junk fees is laudable — and long overdue. However, if it is to be successful, they must recognize that you can’t truly address the worst impacts of junk fees without addressing how they harm incarcerated people and their families.
The nearly two million people behind bars [[link removed]](and their loved ones on the outside) are unfairly exploited by corporations and governments every day. Addressing these junk fees will not end this exploitation entirely, but it will be a significant and meaningful step toward economic justice.
Please support our work [[link removed]]
Our work is made possible by private donations. Can you help us keep going? We can accept tax-deductible gifts online [[link removed]] or via paper checks sent to PO Box 127 Northampton MA 01061. Thank you!
Other news: Show me the money: Tracking the companies that have a lock on sending funds to incarcerated people [[link removed]]
As prisons increasingly force people in prison to pay for their own incarceration, families frequently have to send money to their loved ones behind bars to help them buy essentials like food and hygiene products.
In this 2021 briefing [[link removed]] we looked at the companies that are reaping profits from these money transfers.
Insufficient funds: How prison and jail “release cards” perpetuate the cycle of poverty [[link removed]]
Just because they're released doesn't mean these companies are done sapping money from incarcerated people.
In this briefing from last year [[link removed]], we examined the complex and confusing fees these companies employ to quickly drain the little money that incarcerated people have when they're released.
Please support our work [[link removed]]
Our work is made possible by private donations. Can you help us keep going? We can accept tax-deductible gifts online [[link removed]] or via paper checks sent to PO Box 127 Northampton MA 01061. Thank you!
Our other newsletters Ending prison gerrymandering ( archives [[link removed]]) Criminal justice research library ( archives [[link removed]])
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