The Criminal Rip-off of Ex-Offenders

Bloomberg reported today that JP Morgan Pays Inmates for Fees on Get-Out-of-Jail Card, as the bank settled a case with 50,000 recently released federal inmates. The ex-offenders had positive cash balances in their accounts (attributable to wages earned while incarcerated and/or deposits made by friends and family into their commissary accounts) when they were released. Rather than being reimbursed in cash for the balances, they were required to accept a loaded Chase ATM card.

The ex-offenders’ class action lawsuit claimed the big bank ripped them off by charging exorbitant fees to use the card (such as a $10 fee to withdraw funds at a teller window and a $1.50 “inactivity” fee). The bank must pay $446, 822 to settle the suit; that amounts to $8.94 per ex-inmate.

For someone who’s done time, this sort of predatory behavior is yesterday’s news. There’s a very different economy that exists behind bars: services like phone services and commissary purchases are effectively monopolies, and are managed to exact outrageous costs and fees to access. A three-minute call to loved ones might cost more than $5; an off-brand package of tuna fish (in prison, tuna comes bagged, not canned) might run three times as much as what you’d pay at your local supermarket.

Those incarcerated rely on friends and family to fund their inmate accounts (which are sometimes supplemented by the wages earned from a prison job, which may pay 10 cents an hour). When a family’s primary earner is incarcerated, there’s little money available to fund these accounts. When added to the costs associated with visits to the prison, the financial pressure becomes untenable.

Companies taking advantage of a “captive market” is nothing new. But like caged animals, men and women pushed to the limits will either be beaten to submission, or respond aggressively. The ripping off of ex-offenders is just another instance of how even the shortest periods of incarceration result in life sentences in ways most of us could never imagine.

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