Booker, Warren Introduce Legislation to End Predatory Junk Fees Imposed on Incarcerated Individuals and Their Families

Booker, Warren Introduce Legislation to End Predatory Junk Fees Imposed on Incarcerated Individuals and Their Families

 

WASHINGTON, D.C. – Today, U.S. Senators Cory Booker (D-NJ) and Elizabeth Warren (D-MA) introduced the Families Over Fees Act, legislation to eliminate excessive fees imposed on incarcerated individuals and their families and bring greater transparency to the marketplace. The bill would eliminate excessive and unnecessary surcharges, which drive up the prices of goods and services, and empower the Federal Trade Commission to enforce against violations. It would require companies selling a service or product in correctional facilities to disclose full prices of services upfront and in all advertisements.

Today, Americans are inundated with “junk fees” spanning across industries, from processing fees for concert and airline tickets to resort fees at hotels and early termination fees for phone service. However, the group most vulnerable to junk fees—incarcerated people and their families—have been largely overlooked. Unlike other people, who can sidestep these fees by switching providers or companies, incarcerated people have no way to opt out. They are captive to private companies with exclusive, monopoly contracts. These junk fees often make basic necessities (such as hygiene products, food, medicine, and stamps) unaffordable, and they hinder incarcerated people’s ability to keep in touch with loved ones. In turn, these fees make it even more difficult for incarcerated people to maintain their well-being and successfully reenter society.

Families sending money to people behind bars face steep transfer fees, sometimes as high as 37% of the principal. Additionally, people incarcerated are subjected to exorbitant costs for electronic messaging, access to digital content, and basic necessities. In Kentucky prisons, a deodorant stick priced at $1.98 in a local Walmart cost incarcerated people $4.84 due to added fees. Electronic messaging, a popular medium to keep incarcerated people and their families connected, comes with a whole host of ancillary fees, with individuals and families paying up to 50 cents for each email they read or receive. Tablet computers are often marketed as “free” but significant costs are attached, including per-minute charges for activities like reading e-books or listening to music, and for one provider, a $9 “infrastructure fee.” Considering that incarcerated people typically earn between 13 and 52 cents per hour, the costs for these services are simply out of their reach and are instead passed on to their families, who are often already struggling to make ends meet.

“It is appalling that incarcerated people and their loved ones are subjected to exploitative, predatory fees with no way to opt out,” said Senator Booker. “Justice-impacted people are trapped in a system where private, monopolistic companies levy exorbitant fees on everything from essential hygiene products to communication with loved ones. The exploitation must end, and the Families Over Fees Act will provide essential protections against predatory practices that target our most vulnerable populations.”

“From steep charges for phone calls to money transfers, private corporations are charging sky high prices and slapping unnecessary fees on our incarcerated population and their families,” said Senator Warren. “It’s time to crack down on private corporations that squeeze every penny from people just trying to access basic services and that stand in the way of them and their loved ones.

“Junk fees harm everyone, but they can hit incarcerated people and their loved ones the hardest,” said Caroline Cohn, staff attorney at the National Consumer Law Center. “These junk fees are often charged for vital necessities, and justice-involved consumers often can’t avoid them by using a different company. The Families Over Fees Act would go a long way toward stopping private companies from exploiting some of our society’s most vulnerable consumers.”

“For decades, incarcerated people and their families have paid egregious prices for basic products and services that we buy in the free world for far less. Worse yet, the network of predatory corporations charging these prices tack on junk fees to further boost their bottom line. With no choice but to pay up, incarcerated people and their families often go into debt to afford them or go entirely without,” said Bianca Tylek, Executive Director of Worth Rises. “Any efforts to address predatory consumer practices and junk fees must address those in the prison system. We applaud Senators Booker and Warren for introducing the Families Over Fees Act to increase pricing transparency, prohibit excessive fees, authorize FTC enforcement, and grant families the right to demand fairness.”

 “Billions of dollars each year are mined from incarcerated people, their families, and the often economically disadvantaged communities from which they come. Much of this money comes from charging massive predatory junk fees for things like basic needs and communication. These fees are inflicted upon incarcerated people and their families and used to line the pockets of prison profiteers who have little competition and even less oversight,” said Sarah Staudt, Director of Policy and Advocacy at Prison Policy Initiative. We are proud to support the Families Over Fees Act which places people above profits, and offers much needed consumer protections for incarcerated people and their communities.”

“Justice fees exist in every state in large part because they operate in the shadows and prey on the most vulnerable,” said Priya Sarathy Jones, Deputy Executive Director of the Fines and Fees Justice Center. “Nowhere is this more evident than the junk fees imposed on people behind bars. Doubling and tripling the costs of basic necessities, such reading glasses, hygiene products or food, to increase profit margins is deplorable. These costs mean countless families are sacrificing their own fundamental needs just to help preserve the basic human dignity and care of their incarcerated loved ones.  We applaud Senator Booker and Senator Warren for introducing the Families Over Fees Act prohibiting these egregious fees and protecting people over profits.”

The Families Over Fees Act would:

  • Prohibit excessive junk fees imposed on incarcerated individuals and their families. The bill would clarify that such fees constitute unfair and deceptive practices under the FTC Act and authorize the FTC to establish rules to ban them. It would also empower the FTC and state attorneys general to bring legal action against companies that are charging grossly excessive prices;
  • Requires public companies to clearly disclose costs. The bill requires public companies selling goods or providing services in prisons and jails to disclose full prices upfront and in all advertisements; and,
  • Empower families and individuals to act. The bill creates a private rights of action and includes a ban on arbitration clauses. This enables enforcement without placing the full burden of litigation on government agencies whose time and resources are already stretched thin, while also protecting consumers’ rights to a jury trial.

The bill is endorsed by the following organizations: The National Consumer Law Center; Prison Policy Initiative; Worth Rises; American Economic Liberties Project; Fines and Fees Center; Ella Baker Center for Human Rights; Communities United for Restorative Youth Justice; United CORE Alliance; United Church of Christ Media Justice Ministry; Alabama Appleseed; Family Assistance Program; Legal Aid Justice; Texas Fair Defense Project; and Western Center on Law & Poverty.

To read the full text of the bill, click here.

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