CFPB report exposes financial abuse in the criminal justice system

On Monday, the Consumer Financial Protection Bureau (CFPB) released a report that outlines the financial problems faced by consumers when they come into contact with the criminal justice system. The review highlights onerous fees and a lack of choice at every step of the process. He also notes that the government is increasingly shifting the cost of incarceration onto the families of those incarcerated.

Key points to remember

  • A CFPB report reveals that local, state and federal governments in the United States have exploited consumers who come into contact with the criminal justice system.
  • Exorbitant fees, fines and restitution are exacerbated by a lack of choice in the products and services provided to families of incarcerated persons.
  • The report also points out that the cost of incarceration is slowly being passed on to families.
  • These financial burdens fall disproportionately on people of color, women and low-income families.

Report shows financial burdens ranging from arrest to incarceration to reintegration

The CFPB’s latest report reveals the financial burden families are forced to bear throughout the criminal justice process and how providers, who are often private companies, are taking advantage of the system to increase that burden.

The report highlights that interactions with the criminal justice system are common – one-third of American adults have a criminal record. He then breaks down his conclusions into three main points:

  • High costs: Governments impose onerous expenses on those who come into contact with the criminal justice system in the form of fees, fines and restitution. Failure to pay often results in serious consequences, which can include arrest, detention, prosecution or even incarceration. State governments also rely on third-party debt collectors, who can impose their own fees and fines, which, if not paid, can result in incarceration.
  • Lack of choice: Public procurement in the criminal justice system eliminates competition, which is necessary to keep prices low. As a result, families of incarcerated people are forced to incur high fees if they want to send money to their loved ones. Additionally, individuals re-entering society have little or no choice as to how to receive the funds owed to them upon release, which can also result in high fees.
  • Shift the burden: Governments are slowly shifting the cost of incarceration onto the families of incarcerated people. This includes costs associated with court operations, public defense, drug testing, use of the prison library, and probation supervision. They may also be charged for room and board and medical co-payments. Other costs are high due to government contracts that create a monopoly. For example, a 15-minute phone call from prison cost $5.74 in 2018. Incarcerated salaries are often too low to cover these expenses, forcing families to contribute.

The report focuses on how communities of color, women and low-income families are disproportionately impacted by these costs. In particular, black women sometimes spend up to a third of their income on these expenses, forcing them to give up their basic needs.

The federal agency notes that it took action in October 2021 against financial services company JPay, which charged people leaving the correctional system a fee to access their own money on prepaid debit cards they were forced to use. It also invited consumers to share their story if they had any experiences with financial products and services related to the criminal justice system.