The nation’s second-largest bank will be terminating its business relationships with companies that operate private prisons and immigrant detention centers.
“We have decided to exit the relationship,” Bank of America Vice Chairman Anne Finucane said in a Wednesday interview with Bloomberg, which was among the first outlets to report the news. “We’ve done our due diligence that we said we would do at the annual meeting, and this is the decision we’ve made.’’
The move comes amid controversy over companies like Caliburn, which runs the Homestead holding center in Florida, as well as CoreCivic Inc and GEO Group Inc., which run private prisons.
Essentially, Bank of America’s decision means the financial institution will no longer be lending money to companies like those.
“The private sector is attempting to respond to public policy and government needs and demands in the absence of long standing and widely recognized reforms needed in criminal justice and immigration policies,” Bank of America told The Washington Post in a statement.
“Lacking further legal and policy clarity, and in recognition of the concerns of our employees and stakeholders in the communities we serve, it is our intention to exit these relationships,” the statement continued.
As Finucane noted, the issue arose in April during Bank of America’s annual stockholders meeting. “Ultimately, policymakers are going to have to take on the criminal justice issue more broadly as well as immigration reform,” a bank executive said at the meeting, according to Yahoo Finance. “While that’s happening, we are engaged in the due diligence through the risk framework and through extreme extensive engagement with stakeholders.”
According to the bank, that’s what happened between then and now.
“We appreciate steps they have taken to properly execute their contractual and humanitarian responsibilities, including seeking the counsel of civil rights leaders and legal advocates,” Bank of America’s statement read, Yahoo reported.
Bank of America’s decision was hailed by democratic socialist Rep. Alexandria Ocasio-Cortez of New York.
“Last week, we called the concentration camps at the border for what they are,” the progressive congresswoman tweeted Wednesday.
“In the weeks since,” she added, the “Acting director of Customs & Border Patrol resigned” and “Bank of America announced they will stop financing for-profit immigrant detention & private prisons.”
Last week, we called the concentration camps at the border for what they are.
In the week since:
– Acting director of Customs & Border Patrol resigned
– Bank of America announced they will stop financing for-profit immigrant detention & private prisons.
Words matter. https://t.co/xzBMotvTSB
— Alexandria Ocasio-Cortez (@AOC) June 26, 2019
So, what sort of effect will the bank’s decision have? That remains to be seen.
“Bank of America has announced that it will phase out the financing of companies which operate private prison and detention facilities. To be clear, that is not the business Caliburn is in and their decision has no impact on the Company,” Caliburn said in a statement to the Miami Herald.
GEO Group, meanwhile, said in a statement of its own that it expects Bank of America’s move will have “no impact” on the company’s revolving credit facility, whose “borrowing capacity … remains at $900 million.”
Bank of America is not the first financial institution to make this sort of decision.
Wells Fargo and JPMorgan Chase have also announced they’d be ending their relationships with the private prison industry, the Herald reported.
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