Sending money to someone behind bars used to go something like this: you'd go the post office, buy a money order for about $1.25 and then mail that to the prison or jail. All told, it would cost you no more than $2 — that was before JPay came on the scene.
Over the past 12 years, JPay has taken advantage of the Internet to revolutionize money transfers in the prison system. Seventy percent of all prisons in the U.S. offer JPay services, and for 450,000 inmates, JPay is the only way a loved one can send money. That kind of market share came, at least in part, from a profit-sharing arrangement JPay struck with prison systems. But the result for the families trying to send money is a complex, and expensive, layering of fees.
We had a few questions for Dan Wagner and Eleanor Bell about their six-month investigation into JPay and the other companies making a buck off prisoners' families.
How did you first hear about this story?
Dan Wagner: In 2012, when I was a reporter for The AP, I was looking into different ways that governments use prepaid debit cards to deliver benefits and other funds, and how this practice can result in shifting costs onto poor people. I came across a website for a now-defunct company that was using debit cards in local jails and decided to start digging. A month later, I had learned that JPay was far and away the biggest player in this field. I got Ryan Shapiro on the phone.
The first thing he asked me was, “How did you get my number?”
I replied, “I’m a reporter. It’s my job.”
He kept talking to me over the past two years, more than a dozen conversations. In that time, I began talking to family members of inmates and learning about the incredible array of costs they face — and how the money they receive in prisons is a necessity, not a luxury.
These items you talk about inmates needing, toiletries, winter clothes, have these always been things prisoners need to purchase at commissary?
DW: Not always. Before 1930, families were allowed to bring gifts of food and clothing. Around that time, federal prisons started operating their own stores and keeping the profits to spend inmates’ recreation.
It was not until the ‘80s, however, that prisons began aggressively cutting services and supplies to inmates, experts told me. These cuts and the rapid increase in prison populations increased inmates’ need for money from outside, and opportunities for private vendors inside prisons.
Eleanor Bell: Prisons and jails differ on what basic necessities they guarantee to inmates. Some give a bar of soap and tooth powder, while others provide a whole hygiene kit and even some small amount of stationery. Jack Donson, a former Bureau of Prisons employee we interviewed told us that inside prisons, these kits are called a “diddy bag.”
DW: What interested me about that is, in many states, even if you’re “indigent” — meaning you’re too poor and need free hygiene supplies — the states still charge that as a debt against your inmate account. So if your family wants to send money, they have to pay off those old “indigent packs” before you can buy extra clothes or toiletries.