Wells Fargo Hit for Funding Allegedly Badly Run Private Texas Prison
Wells Fargo just can't win: All the bank wants to do is make good on its underwriting of a private prison company with a history of inmate deaths, sexual abuse and record-tampering, and now a group called Texas United for Families wants the bank to pull out.
Specifically, TUF isn't too happy about a new illegal immigrant detention center the GEO Group (check our GEO investigation here) is building in Karnes City, about 60 miles southeast of San Antonio. The Florida-based company, which last year bought Houston-based private-prison operator Cornell Companies, states on its Web site that the 600-bed Karnes County Civil Detention Facility should be ready to "begin intake of detainees by the fourth quarter of 2011."
TUF claims in a press release that Wells Fargo "holds over 3.5 million shares" in GEO, valued at $92 million. We're not exactly sure where they're getting this figure, but according to SEC filings, Wells Fargo was one of several underwriters in a $250 million private offering in 2008. The bank also acts as a trustee and financial adviser for GEO.
"The private prison industry relies on taxpayers for its income and then lobbies for policies that benefit its bottom line," TUF member and Houstonian Dave Kalloor stated in a press release. (Kalloor also bemoaned the company's alleged "harsh incarceration policies," but we should note that the new facility's inmates will have "individual TVs and microwaves," which makes it sound like the Four Seasons, if you ask us. Of course, the Four Seasons probably has a better track record vis-à-vis employees beating occupants to death.)
Kalloor's TUF colleague in Austin, Rocio Villalobos, stated in the same release that "GEO and Wells Fargo profit from the detention and deportation system that separates families and tears our communities apart. Wells Fargo claims to support community-building and value ethics, yet they are investing in an industry with unethical practices that harm immigrants, people of color, and youth."
We left a message with a spokesperson in the bank's "social responsibility" department, but haven't heard back yet. (Historically, GEO Group has never even responded to our requests for comments -- even canned, bland, lame, benign comments -- so we didn't call to ask them about TUF's allegations.)
According to GEO's Web site, the company "will provide detainees with necessary programming, medical care, recreation, visitation facilities for attorney meetings, and a teleconferencing room for video court hearings." Bonus: The new facility will have "multipurpose rooms" and "laundry facilities." So it'll be just like an awesome apartment complex!
Really, we can't understand why TUF is all bent out of shape. Just because GEO's facilities have a history of being shuttered by the state doesn't mean that the company won't get things right this time.
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