Private Prisons' Stocks Up 74% and 52% Since Election

(Charts via Google Finance)

As you can see from the charts above, the stock prices of the top two private prison corporations have exploded in the two months following the election. The shares of Corecivic (formerly Corrections Corporation of America) and the Geo Group increased by 74% and 52% respectively!

“I do think we can do a lot of privatizations and private prisons,” Donald Trump told Chris Matthews during an interview last June. “It seems to work a lot better.” He’s absolutely wrong. Nonetheless, the Trump administration will likely reverse a directive made by the Department of Justice last September in which all private prison contracts would eventually be phased out of the federal system. That announcement by the DOJ came after the Inspector General (IG) of the Department of Justice issued a comprehensive review of the private prisons that house federal prisoners. The IG report concluded that private prisons don’t offer significant savings to the taxpayers and there were more violent incidents in those facilities. That decision by the DOJ was a step in the right direction, but it applies to only a small portion of the prison population; most prisoners are housed in state facilities. On the other hand, private prisons house over half of all illegal immigrants who are held in detention centers.

Trump’s nominee, Jeff Sessions, for Attorney General is a hardliner in practically every category. He’s a proud supporter of stop and frisk programs, the drug war, and civil asset forfeiture. He’s also an advocate for privatizing prisons. In fact, two of his former staffers are working as lobbyists for the GEO Group. That’s particularly important because the Attorney General customarily appoints the Director of the Federal Bureau of Prisons.

We need a more moderate choice for the U.S. Attorney General’s Office. We need someone with a better record of human rights. The Attorney General must be someone who will respect states’ rights for legal marijuana, oppose civil asset forfeiture, and phase out private prisons. It’s now time for us to become active in the political process. The hashtags #StopSessions and #JustSayNoToSessions are being used on social media to motivate people to call the United States Capitol switchboard at (202) 224-3121. Let’s all get involved and have our voices be heard.

Money Launderer Sentenced to Prison - Not Employed By a "Too Big to Fail" Bank

Twenty-eight states have legalized medical marijuana; recreational marijuana is legal in eight states and the District of Columbia. Nevertheless, the federal government has numerous money laundering regulations in place that block banks from servicing legal marijuana providers. Consequently, legal marijuana dispensaries are forced to do all transactions in cash. Hence, Sen. Elizabeth Warren (D-MA), along with nine other Senators, recently wrote an official letter to the Financial Crimes Enforcement Center (FinCEN) in hopes of easing those banking rules. A spokesman for FinCEN told the Los Angeles Times that they’re reviewing the letter.

This gesture by this group of Senators was a plea for common sense. Providing banking options for legal marijuana businesses will reduce the risk of potential violent crime. Secondly, it would increase financial transparency, which would actually prevent possible money laundering. In other words, criminal organizations would view cash-only marijuana dispensaries as a better destination for laundering money, as opposed to dispensaries where there are electronic records for every transaction. 

Worst of all, this federal fiasco is all for show. These bureaucrats are most concerned with projecting an image of being “tough on crime.” It’s all style and no substance. Case in point, the “Too Big to Fail” banks have employed the most egregious money launderers. Regardless, none of these white collar criminals have gone to prison. Let’s take a look at a recent story involving a Denver woman that illustrates this dichotomy.

Last November, Marybell Delarosa-Quintana was sentenced to five years in prison for money laundering. In fact, the judge said that it would have been 15 years if she had not testified against several Mexican cartel members. As an insurance agent for a small business in Denver, Delarosa-Quintana laundered $281,000 for two Mexican drug cartels. The primary bank that she chose for her deposits was Wells Fargo. This was an ironic choice because Wells Fargo acquired Wachovia after it was involved in the largest money laundering case in U.S. history. Wachovia processed $373 billion in suspected drug money over a four-year period even though federal regulators warned the company about those particular transactions. Nevertheless, no employees of Wachovia were prosecuted and the company had to pay a penalty of $160 million, which was only a fraction of their profits. The takeaway here is that Marybell Delarosa-Quintana was guilty of not working for a “Too Big to Fail” bank.

London-based HSBC, one of the largest financial institutions in the world, eventually surpassed Wachovia’s record for the biggest money laundering scandal. The U.S. Department of Justice described HSBC as the “preferred financial institution for drug cartels and money launderers.” As much as $670 billion of potential drug money went unmonitored by their bank. In fact, drug cartels knew the exact dimensions HSBC bank teller windows. Accordingly, they stuffed boxes of cash through those windows on a daily basis. 

El Chapo's Sinaloa Cartel laundered money through HSBC branches. (Photo - Day Donaldson/Flickr)

Money laundering may not offend you personally if you don’t agree with the war on drugs. However, HSBC also knowingly did business with a Saudi Arabian bank, Al Rajhi, which had links with the 9/11 terrorists. Can you guess what the punishment was for HSBC? In 2012 the DOJ entered into a plea agreement in which HSBC was fined $1.9 billion, but none of their employees faced criminal charges. One year later, former Attorney General, Eric Holder, testified before Congress that the DOJ had been hesitant to pursue some of the largest banks because they were considered "too big to fail." However, a recent report by the House Committee on Financial Services’ Republican staff contradicted that claim. This report found that Holder and other top officials of the DOJ overruled their staffers’ recommendation to prosecute HSBC. As a matter of fact, HSBC negotiated a more favorable plea deal after Holder had personally issued a “take-it-or-leave-it” deadline.

The only plausible explanation for such glaring hypocrisy is the revolving door between government and the private sector. It’s one hell of a racket. Several government officials are succumbing to conflicts of interest while serving in law enforcement or as regulators. The payoff comes when they return to the welcoming arms of the private sector with lucrative salaries for services rendered. As for Eric Holder, he returned to the powerful law firm Covington & Burling in 2015. His salary was never announced publicly, but his former Assistant Attorney General, Lanny Breuer, returned to Covington & Burling in 2013 to reportedly $4 million annually in compensation. Hence, you can assume that Holder’s payday was even greater. Albeit, HSBC was never a client of Covington & Burling; consequently, there was no direct quid pro quo. However, their firm has represented several major banks. And that conflict of interest is the most apparent explanation for why every “Too Big to Fail” bank received the white glove treatment from the DOJ while Holder was in charge.

All in all, the money laundering aspect illustrates one of the many glaring examples proving that the drug war is a lie.

Legal Weed 2016...A Candidate We All Can Agree Upon (Update Wednesday Nov 9th)

Nine states will vote to legalize marijuana this November and here’s what will likely happen…

UPDATE  8 out of  9 states passed their marijuana ballots and the 9th state was a close call!

(Photo Creative Commons)

Recreational Marijuana (adults ages 21 and over) is on the ballot in five states (Arizona, California, Maine, Massachusetts, and Nevada).

UPDATE  The recreational marijuana ballots passed in California, Maine, Massachusetts, and Nevada! Arizona's Prop 205 nearly passed with 47.8% of the vote.

(The most likely) - California, Massachusetts, and Maine

The most recent poll by USC Dornsife/Los Angeles Times has 58% of the state’s voters choosing in favor of legalization with Prop 64. That falls in line with a combined polling average of 58.7% by Ballotpedia. Also, support for Question Four in Massachusetts is growing with 55% in the latest poll by WBUR. In addition, Maine seems likely to vote yes on Question One. According to the last poll by the Portland Press Herald/University of New Hampshire, fifty-three percent will vote in favor of legalization.

(On the Fence) - Nevada and Arizona

Fifty percent of the respondents in the latest Arizona Republic/Morrison/Cronkite News poll supported legalization. Forty-two percent were against it. Nevada is more contentious. The Las Vegas Review- Journal recently found that 47% of voters supported Nevada’s Question 2 with 43% opposed. 

Medical Marijuana is on the ballot of four states (Arkansas, Florida, Montana, and North Dakota).

UPDATE  The medical marijuana ballots passed in all four states!

(Bet the farm) - Florida

Nothing short of a zombie apocalypse in the state capitol will stop Amendment 2 from passing. A variety of polls find that 70% of the voters in the Sunshine State will approve this proposal.

(Unlikely) - Arkansas and Montana

The Arkansas Supreme Court dismissed a medical marijuana initiative from the ballot (Issue 7) because the sponsors of the bill didn’t obtain the necessary number of signatures. On the other hand, there is a very similar medical marijuana proposal (Issue 6) that will remain on the ballot. However, according to the latest survey, 50% of the respondents were against the medical marijuana proposal with 45% polling in favor.

There is only one available poll, Mason-Dixon Polling and Research, in Montana regarding Initiative 182. Both surveys find that 51% were against the proposal with 44% in favor.

(Who knows?) - North Dakota

There is no available polling data.

Prognosis

Florida will become the 26^th state with medical marijuana.

It looks like recreational marijuana will be legal on the entire West Coast. If Nevada and Arizona can pull through, there will likely be nine states, in addition to the District of Columbia, with recreational marijuana. Furthermore, the latest Gallup poll found that 60% of Americans now favor the legalization of recreational marijuana. That will force the federal government to take notice.

We have to continue to push this issue onto the ballot in the states where this is applicable. Twenty-four states have systems in place for ballot initiatives. Of those 24, that leaves 15 states in which recreational marijuana isn’t currently legal or up for vote in November. Illinois, Michigan, and New Mexico seem to be the most likely to follow this route because their states already allow medical marijuana. Medical marijuana remains illegal in Idaho, Mississippi, Missouri, Nebraska, Ohio, Oklahoma, South Dakota, Utah, and Wyoming, where this issue could be placed on the ballot for the next election.