USA: Govt. contractors accused of profiting from separation & detention of migrant & asylum seeking families

In May 2018, the Trump administration announced that it would increase prosecutions of migrants and asylum seekers crossing the US-Mexico border and implemented a “zero tolerance” policy intended to deter new migrants with the threat of jail sentences and by separating immigrant children from their parents. US Attorney Jeff Sessions stated “If you cross the southwest border unlawfully, then we will prosecute you... If you’re smuggling a child, then we’re going to prosecute you, and that child will be separated from you. If you don’t want your child separated, then don’t bring them across the border illegally.”

To date, more than 2,300 children have been separated from their parents at the U.S. border. Human rights organizations and activists, religious leaders, politicians, CEOs, company representatives and others have strongly condemned the practice of separating children from their parents. The CEOs of Chobani, Apple, Uber, and others have expressed that the practice is inhumane and called for an end to family separation. (See more regarding CEO statements and company actions here.)

Following significant pressure, US President Donald Trump signed an Executive Order on June 20, 2018 ending the practice of separating families. However, parents will still be prosecuted and families will remain together in immigrant detention as their cases are being processed, raising significant concerns regarding indefinite detention. It is also unclear when and how families that have already been separated will be reunited. 

Human rights organizations and journalists have accused private prison operators CoreCivic and GEO Group and govt. contractors Comprehensive Health Services Inc., Dynamic Service Solutions, Dynamic Educational Systems, General Dynamics and MVM of financially profiting from family separation and detention. An online resource by Corrections Accountability Project, "Immigrant detention: An American business" also alleges that bank and investor financing for CoreCivic & GEO Group supports these two companies to profit from the Trump Administration's harsh immigration policies.

The Business & Human Rights Resource Centre invited these companies, banks and investors to respond. Responses from BlackRock, BNP Paribas, CoreCivic, GEO Group, Comprehensive Health Services Inc, General Dynamics, MVM, Vanguard and Wells Fargo are available below. Bank of America, Dynamic Service Solutions, Dynamic Educational Systems and US Bank did not respond. JPMorgan Chase and SunTrust declined to respond.

Update (as of 13 July 2019): Bank of America, BNP Paribas, JPMorgan Chase, SunTrust, and Wells Fargo have decided to stop financing private prisons in the United States.

 

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Company non-response
10 July 2018

Bank of America did not respond

Bank of America did not respond to allegations that through its financing for GEO Group and Core Civic, Bank of America is helping to enable the work of these for-profit US immigration detention companies that are allegedly profiting from the Trump Administration’s harsh immigration policies, including separating migrant and asylum-seeking families.

Company response
10 July 2018

BlackRock response

Author: BlackRock

Virtually all of these shares are held in index funds. Index providers determine which companies to include in the indices they create. As a fiduciary, BlackRock then offers clients funds, like ETFs, that are designed to track the investment results of those third-party indices.

Download the full document here

Company response
10 July 2018

BNP Paribas response

Author: BNP Paribas

We thank you for your request dated July 3rd, and raising our attention on the report called "Immigration Detention: An American Business" by Corrections Accountability Project, published in June 2018. In your request, you stated that "this report alleges that through its financing for GEO Group and Core Civic, BNP Paribas is helping to enable the work of these for-profit US immigration detention companies that have and continue to profit from the Trump Administration's harsh immigration policies, including separating migrant and asylum-seeking families". We are taking this matter very seriously. We will verify our link to the above companies. We can already assure you that, would BNP Paribas be exposed to this issue via a client, we would engage the dialogue with him.

Download the full document here

Report
10 July 2018

Immigration detention: An American business

Author: Corrections Accountability Project

On April 6, 2018, the administration announced a "zero tolerance" immigration policy that requires every undocumented adult immigrant and asylum seeker in the U.S. to be criminally prosecuted under federal law... The "zero tolerance" immigration policy and the executive order ending family separation have created windfalls for some... For-profit companies contract with the various government agencies that manage the apprehension, detention, and deportation of undocumented immigrants... The largest financial winners at the border are, as many expect, the private prison companies that operate immigration detention centers, the most prominent of which are The GEO Group and CoreCivic. With more than 40% of their respective revenues stemming from federal contracts, these companies invested heavily in the outspoken federal, state, and local candidates interested in advancing harsh immigration policies like "zero tolerance" during the 2016 election cycle... [B]oth raked in millions on the thousands of immigrant adults and children imprisoned in their facilities.   

... [B]anks... provide credit financing, or loans, to The GEO Group and CoreCivic for the construction of new facilities and expansion of existing facilities... without which they could not pursue such projects... [These banks include JPMorgan Chase, SunTrust, Bank of America, BNP Paribas, US Bank & Wells Fargo.]... [A]s publicly-traded companies, The GEO Group and CoreCivic are also dependent on their institutional investors... Largest institutional investors [include]... Vanguard & BlackRock.  

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Company non-response
10 July 2018

JPMorgan Chase declined to respond

JPMorgan Chase declined to respond to allegations that through its financing for GEO Group and Core Civic, JPMorgan Chase is helping to enable the work of these for-profit US immigration detention companies that are allegedly profiting from the Trump Administration’s harsh immigration policies, including separating migrant and asylum-seeking families.

Company non-response
10 July 2018

SunTrust declined to respond

SunTrust declined to respond to allegations that through its financing for GEO Group and Core Civic, SunTrust is helping to enable the work of these for-profit US immigration detention companies that are allegedly profiting from the Trump Administration’s harsh immigration policies, including separating migrant and asylum-seeking families.

Company non-response
10 July 2018

US Bank did not respond

US Bank did not respond to allegations that through its financing for GEO Group and Core Civic, US Bank is helping to enable the work of these for-profit US immigration detention companies that are allegedly profiting from the Trump Administration’s harsh immigration policies, including separating migrant and asylum-seeking families.

Company response
10 July 2018

Vanguard response

Author: Vanguard

We will not be commenting on individual companies or holdings. It is our desire that policymakers come to a swift resolution to ensure the safety and security of the children who have been separated from their families. While defense companies make up a very modest portion of the Vanguard funds’ portfolios, and are largely held in index-tracking funds, we understand that some investors may wish to avoid certain companies altogether. Investors looking to screen Vanguard funds for specific holdings can use the search tool on Vanguard’s website. We also offer Vanguard FTSE Social Index Fund, which screens companies based on certain social, human rights, and environmental criteria.

Download the full document here

Company response
10 July 2018

Wells Fargo response

Author: Wells Fargo

Wells Fargo respects the seriousness of our country's ongoing debate about the criminal justice and immigration system. As indicated in our Human Rights statement, Wells Fargo recognizes that governments have the duty to protect human rights, and our company has a responsibility to respect human rights... Wells Fargo does not hold any shares of either The GEO Group or CoreCivic. Wells Fargo Funds, which are owned by the Funds’ investors, not Wells Fargo, currently hold a very small position in the companies in a passive index fund. SEC filings can make it appear that Wells Fargo is the owner, but we are not.

Download the full document here

Report
3 July 2018

An examination of private financing for correctional & immigration detention facilities

Author: In the Public Interest

While governments have traditionally used municipal bonds to finance the construction of correctional facilities, there is evidence that the two major private prison companies, CoreCivic (formerly Corrections Corporation of America, or CCA) and GEO Group, are actively pushing governments to consider the use of private financing to build new facilities... This private financing boom has serious implications for policy making:

  • Private prison construction deals embed private interests in the criminal justice system, perpetuating mass incarceration...
  • Private prison construction deals prop up companies with records of human rights abuses. Regardless of whether a new facility will be operated by private or public sector staff, these deals grow and strengthen CoreCivic and GEO Group, both of which have extensive records of human rights abuses.

While this report focuses on the facility construction financing aspects of these contractual arrangements, it is important to note that CoreCivic and GEO Group’s track record providing facility operations has been consistently abysmal. There are numerous examples of both companies cutting corners and failing to provide humane treatment of prisoners and appropriate prison conditions... These records of human rights abuses should give any governmental entity serious pause before signing any type of contract with private prison companies.

Read the full post here