In Oklahoma’s prison system, inmates spend millions of dollars a year from their trust accounts, buying canteen items and paying restitution, fines and other costs.
Much of that money comes from family members. They deposit funds into inmates’ "trust fund accounts" that are part of the Department of Corrections’ offender banking system.
They also pay a price for that giving.
Two private companies that provide banking services in prisons under state contract tack on fees, and family members say those fees, paid over time, are onerous.
The fees for depositing money by Internet or telephone range from about $4 to $12 per transaction, depending on the amount deposited. But the fee can represent anywhere from 3.7 percent to nearly 40 percent of the deposit amount. The fees generate millions of dollars in annual revenue for the vendors.
Ester Holzendorf, a retired Corrections Department employee who now lives in Missouri, said the inmate banking fees make it hard to send money to her grandson, Sean McKinzy, who is serving time in the Dick Conner Correctional Center in Hominy on Tulsa County robbery and assault convictions.
“It costs us every time we send him something,” Holzendorf said. “I sent him $50 and had to pay $6.95 just to get him the money. If we send a money order (by regular mail), it’s cheaper, but the money order goes out of state, then back to Oklahoma.” That can take more than a week, she said.
The money-service companies are Florida-based JPay Inc., which handles most electronic money transfers to inmate trust accounts, and Access Secure Deposits, which is part of the Missouri-based Keefe Group.
In an investigative report in September, the nonprofit Center for Public Integrity reported that JPay is the largest prison banker in the nation, providing money transfers to 1.7 million offenders in 32 states. JPay pulled in more than $50 million in revenue in 2013 and was expected to transfer more than $1 billion in 2014, the center reported.
Corrections Department spokeswoman Terri Watkins said the banking fees are set to cover the vendors’ costs, and the department has pushed the vendors to keep prices low. She said the state has contracts with both JPay and Access “to keep prices competitive.”
“We continue to negotiate a competitive price for the level of service provided,” Watkins wrote in an email to Oklahoma Watch. “JPay posts money orders and government checks for free for our offenders because of this negotiation.”
JPay’s money-order fees weren’t free until last year. The Center for Public Integrity reported in November that because of its investigation, JPay had eliminated money-order charges in three states, including Oklahoma. Access Secure Services still charges a $1 fee, according to the company and an online DOC form.
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