JPay Inc., the biggest provider of money transfers to prisoners, has stopped charging fees to families sending money orders to inmates in Kansas, after a Center for Public Integrity report on the company’s fee structure.
The change that means inmates’ families can now send money for free in every state but one where the company does business.
The Center for Public Integrity reported last fall that families of hundreds of thousands of inmates were charged high fees to send their incarcerated relatives money for basic needs like winter clothes and doctor visits. JPay, which offers families the ability make deposits into inmates’ accounts online for a fee, also charged for deposits sent by mail in four states housing roughly 110,000 inmates. Mail-in payments were traditionally the only free way for families to send money.
The Center reported in November that JPay had eliminated deposit-by-mail fees in Ohio, Indiana and Oklahoma. Kansas was the lone holdout.
JPay is the biggest of the prison bankers, companies that provide financial services to inmates and their families, often charging high fees and sharing their profits with the agencies that contract with them. JPay handled nearly 7 million transactions in 2013 and expected to transfer more than $1 billion in 2014.
The company’s marketing literature urges families to send money by phone or online. Fees for those services can exceed 45 percent of the deposit amount. Families who didn’t like the system could always choose to mail a money order, JPay CEO Ryan Shapiro said in an interview last summer. He did not know at the time where JPay was charging fees for mail-in deposits.
Shapiro later said that The Center’s questions about money order deposit fees caused him to consider the impact of JPay’s policies on its poorest customers. He said he would seek to convince all states to provide families with a free deposit option.
Kansas Department of Corrections spokesman Jeremy Barclay last week confirmed that the $2 fee has been eliminated. Although the change occurred on Jan. 1, the agency’s website still states that there is a fee to deposit money orders through JPay. The department will update its website with the change “within days,” Barclay said in an email.