Elizabeth Warren investigates for-profit prison money
Sen. Elizabeth Warren is no fan of private equity or private prisons, and Axios has learned that she wants answers from PE firms invested in prison services companies.
The big picture: Warren's goal is to determine if private equity ownership results in a lower standard of services, similar to an investigation she launched last month into PE-owned for-profit colleges.
Warren yesterday sent letters of inquiry to 5 firms. Co-sponsoring the letters were Reps. Mark Pocan (D-Wis.) and Alexandria Ocasio-Cortez (D-N.Y.).
- Requested information includes revenue, profits, number of employees and number of incarcerated individuals related to the underlying investments.
None of the 5 targeted firms have a specific focus on prison services, but each has made at least 1 significant investment in the sector:
- American Securities: GTL, one of the 2 largest providers of inmate calling and emailing services.
- Apax Partners: Attenti, a provider of electronic monitoring products.
- BlueMountain Capital: Corizon Health, the largest private provider of medical services to prisons, operating in 220 facilities in 17 states.
- H.I.G. Capital: Trinity Services Group, a provider of food and commissary services to correctional facilities in 43 states. It also owns health care services provider Wellpath.
- Platinum Equity: Securus, one of the 2 largest providers of inmate calling and emailing services.
The bottom line: Warren already has proposed legislation that would make private equity funds liable for debt obligations of their portfolio companies, including worker pension obligations. Now, she seems interested in expanding that liability to "consumers" of such portfolio companies, whether they be for-profit students or prisoners.