How the FCC Helped Pave the Way for Predatory Prison Telecoms

Predatory companies have spent decades overcharging inmates and their families for phone calls and video conferencing services. Now, they’re shifting their focus toward charging exorbitant fees to access ebooks and use the internet, thanks in part to federal regulators who’ve turned a blind eye to monopoly power.

Earlier this year, the West Virginia Division of Corrections (WVDC) struck a new deal with Falls Church, Virginia-based GTL, which describes itself as a vendor of “transformative corrections technology.” GTL dominates roughly 50 percent of all U.S. prison telecom contracts, something critics have long stated results in aggressive overbilling of inmates and their families.

As first reported by Reason, GTL’s latest contract involves providing inmates access to free tablets. But while the tablets are “free,” doing anything with them is far from it.

According to the GTL contract with the state, accessing ebooks on the tablet will cost inmates up to 5 cents per minute, while using the tablet for video visitations costs inmates 25 cents per minute. Sending any messages via the tablet is 25 cents per message, 50 cents per photo attachment, or a dollar per attached video.

Many inmate families can’t afford such high costs, and West Virginia inmates are estimated to make between $6 and $81 per month. It’s worth noting that inmates don’t have to use the tablets, and the WVDC receives a 5 percent commission on tablet use that may go to fund other inmate projects.

A GTL spokesperson told Motherboard that the company did not have a comment at this time.

Why give such responsibility to companies with a long history of overbilling and abuse? The answer lies partly in exclusive contracts and “concession fees" (long criticized as little more than glorified, legalized kickbacks) that allow the sector’s biggest players to buy their way to industry dominance. The other factor is the Federal Communications Commission (FCC), which could have stopped the situation from getting so bad.

Thanks to apathy and revolving door regulators, the prison telecom sector has seen no shortage of scandal, from allegations that providers illegally record private attorney client phone calls, to the industry’s involvement in the abuse of sensitive subscriber location data.

In 2015, the previous FCC finally proposed eliminating concession fees from companies like GTL and capping prison phone calls at a maximum of 11 cents per minute.

“Today’s actions help to address a prime example of a market failure,” previous FCC boss Tom Wheeler said at the time. “Where, as here, market forces have not been able to discipline costs to consumers, we must shoulder the responsibility of promoting communications services that do not leave the most vulnerable of our population behind.”

But GTL and other industry giants quickly sued, some executives claiming that such price caps would cause “jail unrest” and potential riots. Current FCC boss Ajit Pai, then just an agency commissioner, voted against the price caps.

Once appointed FCC boss by the Trump administration in 2017, Pai quickly set about dismantling the effort by blocking FCC lawyers from defending the agency’s own proposal.

In a 2017 filing with the FCC, Human Rights Defense Center Executive Director Paul Wright lamented Pai’s involvement as a conflict of interest given he formerly represented one of the industry’s biggest players.

“Since joining the FCC as a Commissioner in 2012, Mr. Pai has vigorously and consistently taken actions to undercut all federal regulation of the Industry,” he wrote. “Securus enjoys kickback-based monopoly contracts with more than 3,400 correctional facilities, and as a result can exploit and price-gouge at least 1.2 million prisoners and their families in 48 states.”

At the time, the FCC told Ars Technica that Pai's work on the file was cleared by the FCC's ethics department. The FCC did not respond to a Motherboard request for comment.

The Appalachian Prison Book Project, which published a report on GTL’s West Virginia contract, notes that much of the content the company is charging inmates 5 cents per minute to read is freely available via Project Gutenberg, though many of the titles that would most interest inmates (how-to books on carpentry, for example) aren’t available.

That the same companies that turned prison phone calls into a racket are now shifting their business models toward ebooks and internet access isn’t surprising. Neither is the growing chorus of criticism of the effort. Less discussed is how this dysfunction has been enabled by an FCC boss who was more than happy to turn a blind eye to monopoly power—and the decades of inmate family abuse that resulted.