A year and a half ago, after a grand jury declined to indict police officer Darren Wilson in the shooting death of Michael Brown in Ferguson, Missouri, protests swept the nation. Portland, Oregon, was no exception. More than 2,000 people rallied outside the Multnomah County Justice Center the day after the decision was announced. Danica Brown, 48, joined hundreds who swarmed the streets, blocking traffic and bridges. A PhD candidate at Portland State University and a seasoned activist, Brown was one of seven protesters arrested that day.

Brown recalls the experience as unpleasant: As she knelt on the ground in handcuffs, one officer took a trophy photo. She was shuttled to a local police station, for a brief interrogation, then taken back to the Justice Center, where she was charged with disorderly conduct and interfering with a police officer.

Brown was released at 2:30 am on November 26, 2014, at a loss about how to get home, nine miles away. Her wallet, cellphone, and keys were in her backpack at the first police station. The $30.97 she had in her pocket was taken by the Multnomah County Sheriff’s Office, which operates the Justice Center jail. Until May of that year, correctional officers would have simply handed her the money back, and she’d have been able to grab a taxi home. Instead, says Brown, an officer handed her a sheaf of papers and a piece of plastic—a Numi Prestige Prepaid MasterCard—that held her cash.

The materials included a densely worded brochure explaining the terms and fees associated with the debit card, and a list of nearby ATMs. But Brown had left her glasses at home and the type was too small to read; the officer didn’t offer any words of explanation.

Standing on the steps of the Justice Center, after being released, “I was kind of freaking out,” Brown says. “It’s not a safe area. I had no money, no phone, there’s no train that time of night.” Brown lucked out when her partner showed up, hoping to find her. “I was so relieved he was there,” she says.

Over the next week Brown used the Numi card to purchase coffee and groceries. Five days later, she was charged $5.95 for a monthly service fee and then 95 cents for a declined service charge. The criminal charges against Brown were eventually dismissed, but according to transaction records, she lost 22 percent of her money to fees.

Numi Financial describes itself as a “leader in stored value card solutions for the criminal justice and corrections industry.” Its parent company, Stored Value Cards, based in Carlsbad, California, provides debit-card services to jails in 44 states through Numi Financial and Futura Card Services, issued by banks. The terms for the card used in Multnomah County lists 11 possible fees—the $5.95 monthly fee, a $2.95 fee for ATM withdrawals, $0.95 for a declined transaction, $1 to check the balance, and $9.95 to have the balance refunded by check. Some cards have as many as 19 fees, a maintenance fee as high as $15 a month, and higher fees for international transactions. As for the banks that issue prepaid cards like these, they spent, on average, only 10.3 cents per transaction in 2013, including processing and third-party fees, according to the Federal Reserve Bank.

Brown is currently the lead plaintiff in a class-action suit filed against Numi Financial’s parent company in US District Court. A judge ruled in February against Numi’s request for arbitration.

Veronica Thompson, a 31-year-old social worker, was arrested at another Justice Center protest a few days after Brown and was released as the sun rose the next morning. Eager for a quick bus ride home, a hot meal, and sleep, she was likewise handed a Numi card instead of her $15.50 in cash. Thompson says the correctional officer told her, “‘It works like a debit card.’ He didn’t say, ‘Hey, there’s a bunch of fees attached.’” Among the documents Thompson received was a handout explaining that cardholders could avoid fees by getting money back from a cashier.

Thompson attempted to get cash at a nearby convenience store, but the cashier refused her. With no money, she walked the three miles home. “It was cold,” she says. “I had been awake for 24 hours. I was so mad that my money was taken.”

In the following days, determined to avoid charges, Thompson used the card for no-fee purchases like groceries. But she hadn’t yet spent all her money when the monthly fee drained her balance.

Transaction histories and bank receipts from seven people arrested in Portland over a 16-month period who received Numi cards show they lost from 7 percent to 67 percent of their money to fees.

Birth of a Prison Industry

Numi is one of many for-profit players in an increasingly privatized prison industry. State spending alone on corrections hit $52.4 billion in 2012. Hundreds of private-sector contractors now provide food, clothing, riot gear, phone service, computers, and health care, in addition to directly operating many correctional facilities. In addition, prisoners and their families pay for numerous services, including phone calls, a $1.2 billion-a-year business, according to The New York Times.

At least 10 companies now offer release cards or inmate banking services to correctional systems. JPMorgan Chase does not give a card to each and every prisoner, but according to the Center for Public Integrity, it has a “lock” on the Federal Bureau of Prisons population, which currently stands at just under 200,000. At the state level, CPI found that JPay, a company founded in 2002, dominates, generating “well over $50 million in revenue” in 2013. (It was acquired for $250 million in 2015 by Securus Technologies, a Dallas-based prison phone provider.) But when it comes to county jails, Numi has quietly become a big player.

Numi is now in more than 400 jails across the country, including large facilities that house up to 8,500 inmates, and the company issues more than 600,000 cards a year. That’s enough to make Numi one of the top 10 providers nationwide of prepaid cards of all kinds, according to Adam Rust, research director of the North Carolina–based Reinvestment Partners, which advocates against predatory lending practices. The Mercator Advisory Group estimates the entire US prepaid-card market was $594 billion in 2014.

Richard E. Deloney Jr., vice president of business development at Numi, said Numi’s model is based on “turnover.” “We market to the 3,300 jails in the country,” he said. “When you go to the state or federal prisons, you’re in there for a while. They don’t do us any good.”

Deloney is correct about the market potential of jails. The Department of Justice estimates about 650,000 people are released from state and federal prisons annually. The number of bookings in jails in 2013, which approximates the number of releases and transfers, was 11.7 million.

‘Same Fees You and I Pay’

Contracts with jails not only cover more inmates; they often experience far less scrutiny. In April 2014 Multnomah County Sheriff Daniel Staton inked the contract introducing Numi’s inmate-release cards into Portland’s jails with no public debate. Portland Mayor Charlie Hales said the first he heard of Numi was a brief news item published seven months after the contract went into effect. When Multnomah County Assistant Attorney Carlo Calandriello, who vetted the contract, was asked how he determined whether the terms and conditions were appropriate for cardholders, he said, “I did some Googling.” A spokesperson for Deborah Kafoury, chair of the county commission, said the fees “seem exorbitant,” but added that the board has “no authority” over the contract.

Since Multnomah County adopted the Numi card in May 2014, nearly 11,o00 people a year have been issued cards after arrest and release. Previously, they would have received their first $100 in cash and the remainder by check.

In 2013 Sheriff Staton also contracted with Securus Technologies to install video-visitation services and TouchPay Holdings to provide computer kiosks for booking arrestees and handling inmate money. Numi was approved later to provide debit cards as a Securus subcontractor. Numi’s revenue, according to Deloney, comes “off the usage [fees],” while companies like Securus or TouchPay—which introduce Numi into a facility—get 70 cents to a dollar per card issued.

I met Deloney while he was working the vendor hall at the National Sheriffs’ Association conference in Baltimore last year. He said Numi provides jails a supply of cards, a card reader, training, literature, and customer service, adding up to “a sunk cost of several dollars per card.” He pitched the card to conference goers as “no different than the MasterCard debit card I have in my wallet.” The fees, he says, “are not onerous, they are the same fees you and I pay.” But they are high enough for Numi “to recoup our costs and to make money for our shareholders.” According to a 2015 Dun & Bradstreet report on Stored Value Cards, Numi’s parent company, its revenue is $3 million a year.

Deloney claims the card is easier than a cash or check system for jailer and arrestee alike. For jails, the Numi card eliminates check fraud, reduces “manpower, processing, accounting,” and takes “potential graft out of the system.” For inmates, Deloney says, “We try to make it easy.” He says cardholders can “buy a cup of coffee or brand new shirt, and get all your cash back at no charge. There are plenty of ways to liquidate this thing without the account maintenance fee kicking in.”

‘False’ Claims

In October 2014 Deloney traveled with Numi President Brad Golden to Santa Clara County, California, to personally lobby the county’s Inmate Welfare Fund Committee, which manages money received from inmates, to adopt the Numi card. Deloney met with the committee again in March 2015. Their lobbying process would eventually reveal information about the cards that challenge Numi’s claims.

According to minutes from the 2014 meeting, “Mr. Golden noted that one third of NUMI’s cardholders pay absolutely no fees at all.” Golden also said “less than 1% of debit cards went uncashed,” and “of the remaining cardholders most pay between 3-4% on their balance.”

Dr. Jeffrey Schwartz, a member of the committee until October 2015 and an expert in corrections policies, was present for those meetings. Schwartz says Golden’s claim that fewer than 1 percent of cards go uncashed was “really questionable…on its face.” He says, “It doesn’t make sense that 99 out of 100 would manage to cash a debit card” given the disproportionately high number of inmates “who are too mentally ill to follow through, who are homeless and have very few resources, who are not English speakers.”

After the committee expressed reluctance, Deloney said “Numi would be able to provide data” to aid the committee’s analysis. Numi turned over three months of reports from two jails in California and one in Oregon, covering 10,963 Numi cards. Of those cards, 30.1 percent went unused; overall, cardholders avoided fees on only 19.8 percent of the cards—a far worse rate than the one-third Golden had claimed. “That’s not a rounding error,” Schwartz said.

“It isn’t a good situation,” he adds, “when vendors are making claims that are not accurate, substantially false, with their own data.”

In March 2015 the IWF committee raised additional concerns about the data. Of the cards in the data set, a majority, 56.5 percent, were worth less than $20—an amount that is returned to arrestees in cash under the current system. Yet, as one jail commander observed, “51 percent of monies totaling $19.99 or less…go to the bank in the form of maintenance fees.” Another commander noted that uncashed cards “were eventually depleted by maintenance fees to the bank rather than being paid out to the inmates.” An IWF staffer observed that most prisons are unable to process cards from transferred prisoners with a debit card, so if they were given the card, it would sit in the property room “until it was fully depleted by maintenance fees.” The committee concluded that Numi cards “may have an adverse effect on inmates with a low debit card balance.”

On the question of disclosing fee revenue, Numi’s representatives are at odds. While Deloney claimed that Numi was prohibited from tracking card usage by laws such as Sarbanes-Oxley, which prohibits disclosure of personal financial information, Golden had previously said Numi could “report on the fees paid by cardholders…and had in fact recently prepared a similar report for a client showing fees broken out for multiple specified amount ranges.”

Paul Wright, executive director of the Human Rights Defense Center, which has filed class-action suits against Numi Financial and other prison-release debit-card providers, says, “There’s even more secrecy in the inmate debit cards than the rest of the prison industry, which is one of the least transparent and least accountable government sectors in the country. There is no oversight over these companies, there’s no regulation.” Of Numi’s revenue, he asks, “Is it $3 million a year, $10 million, or $20 million? Who knows? We know a vast amount of cards go uncashed.”

Internal Numi and Futura documents further undermine company claims. While Golden said arrestees can easily get cash without a fee, a PowerPoint from Deloney lists only two options for liquidating the card, both of which come with fees. One involves paying up to $5.45 in fees to get $20 from an ATM. The other involves paying $4.95 for a cash advance at a bank.

Leaked company emails indicate Numi’s high fees are an issue for many jails, not just Santa Clara’s. “The fee plans are designed to meet facility concerns over inmate fees (some locations are more concerned about this than others),” reads one e-mail to a prison-industry vendor from Deloney. But for Numi’s corporate partners, the e-mail notes, those same fees “enhance the potential partner revenue share (the higher weekly fee structure naturally generates more profit for sharing).”

‘Backs of Poor People’

Many experts in consumer finance and criminal justice oppose the use of fee-based cards by jails. Lauren Saunders, an attorney with the National Consumer Law Center in Washington, DC, submitted extensive comments on proposed federal regulation of prepaid cards. “These cards are being used to deliver one-time return of funds,” she says. “It’s outrageous that there would be any fees taken off that. Clearly, these cards are designed to make it impossible to avoid fees.”

Kati Dunn, county director of the Metropolitan Public Defender Services in Portland, which represents thousands of low-income clients a year, says Numi card fees come “off the backs of poor people. There are people who cannot legitimately spend $2.50 on a bus ticket to get to court.”

In November 2014, the Consumer Financial Protection Bureau proposed new rules to strengthen and clarify regulations concerning the prepaid financial product industry. But according to Saunders, the regulations, as proposed—they are expected to be final by the end of the summer—“would not address the main abuses in prison release cards.”

The Electronic Fund Transfer Act mandates when consumers receive money electronically from employers or as a government benefit, they must have a choice of financial institutions where the account is established. Another law prohibits “compulsory use,” meaning recipients must have options such as by cash or check for receiving payments. But the prison debit-card industry, Saunders explains, has thus far remained outside of both of these regulatory frameworks.

The proposed CFPB rules attracted 5,219 comments from industry and consumer groups and the public, including several addressing the lack of regulation for inmate debit cards. JPay was the lone prison debit-card provider to weigh in, arguing that the new regulations shouldn’t apply to their corner of the industry. Prison debit cards, JPay argued, are not government benefit cards, as they contain the prisoners’ own money, and the compulsory use rule should not apply as the fees are not onerous and cash and check systems “have proven to be problematic for correctional agencies and released inmates.”

Of the 16 jail systems we identified that use the Numi card, not one provided another way for inmates to receive money upon release.

Numi Financial has spread its products into our nation’s jails so quietly that many experts in criminal justice and the prepaid cards, even staff on the Senate Committee on Banking, Housing, and Urban Affairs, were unaware of its operations until contacted by a reporter. Oversight is so minimal that, in Multnomah County, Numi routinely violates its contract. The contract stipulates that Numi charge the maintenance fee after five business days, but in all the cases we documented, the fee was deducted before the five-business day grace period ended. Hundreds, even thousands, of Numi cardholders from Multnomah County jails may have been improperly charged the $5.95 monthly fee.

By implementing a for-profit debit-card system, public officials are making a choice. They could easily stick with the old cash or check systems, or follow the lead of Oregon, which created the “Oregon Trail/Offender Debit Card,” a fee-free card for state prisoners. An official with the Oregon Department of Corrections says the agency pays just a nickel a card to the state’s Department of Human Services, which covers the “significant cost to managing it.”

Yet counties continue to adopt Numi. In the past few years, the Numi card has been introduced in jails in Fresno, Las Vegas, Phoenix, Portland, Sacramento, Houston, and Tampa, among others. Based on data released through an open-records request, these cities load an estimated $14.8 million in inmate funds per year. Data from Multnomah County and Reinvestment Partners put the average card load at $72, meaning these seven cities alone may issue 210,000 Numi cards annually. Less-populated counties that have adopted the Numi card, such as Mendocino, Napa, and Tuolumne in California; Brevard, Charlotte, and St. Lucie in Florida; and Pierce County, Washington, and Pinal County, Arizona, issue on average between 96 and 480 Numi cards a month.

Preying on Immigrants

Numi’s highest profits may come from jailed migrants. As Paul Wright, executive director of the Human Rights Defense Center, points out, “Large numbers of [jailed] people are deported to countries where they aren’t able to use the inmate debit cards.” The balance on these uncashed cards would be absorbed by Numi and the issuing bank through maintenance fees.

Numi is used in many cities with large Latino communities such as Houston, Las Vegas, Sacramento, and Phoenix, whose county jails are the initial detention facility for thousands of undocumented immigrants who are eventually deported. (In 2015 ICE deported 235,413 people, including thousands who had just completed sentences in state or federal prisons.) The number of inmates facing deportation is so high, Numi has a special blue ICE transfer card that it offers to jails for free.

Alejandro Villavaso Gonzalez, 48, is typical. He was picked up in Phoenix on May 25, 2015, for a minor traffic violation. Gonzalez had $2,100 in his pocket, pay he had just collected for himself and two coworkers for a home roofing job. He was booked into the Maricopa County Jail and the cash was loaded on a Numi debit card. He was transferred to an ICE facility and deported to Nogales on June 23—the result of a DUI conviction in California decades earlier.

Once in Mexico, Gonzalez was effectively penniless. The PIN he’d been told to use—his birth month and day—did not work. Gonzalez tried to withdraw funds seven times; each time the card was denied and charged $0.95. Eventually he sought help at a migrant center, which assisted him in resetting his PIN. He withdrew $460 in pesos, for which he paid $18.75 in fees—the fees are higher for international use—an amount equal to more than two hours of his wages. Rather than pay those fees for at least four more withdrawals, they contacted No More Deaths, a US-based immigrant rights organization. Cameron Jones, a volunteer, transferred the rest of Gonzalez’s money to a US bank and then wired it to a relative for a one-time Western Union fee of $20.

If Gonzalez had not sought out assistance, all $2,100 “would likely have been lost,” Jones said. “How many others aren’t so lucky?” Six months before Gonzalez’s case, No More Deaths issued “Shakedown,” a report documenting the ways money and belongings are seized from deportees. The report recorded 19 incidents involving debit cards, including cards issued by Numi. Volunteers aided migrants in recovering funds by calling English-language customer service, filing complaints in states where the Numi card is issued, writing letters to Numi Financial and its lawyers, and even crossing the border to cash out cards in order to recoup funds. Despite the intensive aid, No More Deaths calculated that an average of $27 per card, or one-third of the monies in these 19 cases, was lost to fees.

Without assistance, maintenance fees can suck accounts dry. In 2012, Enrique, an undocumented immigrant who lived in the United States for 20 years, was convicted in California on child-endangerment charges. After serving his sentence, he was given a Numi card with $100 of his money, transferred to an immigration detention center in Eloy, Arizona, and eventually deported to Nogales. Once there, a No More Deaths volunteer dialed into Numi’s phone system only to discover Enrique’s account was empty. “I am pretty sure the $100 he had on his card was eaten up in weekly fees while he spent nine months in Eloy,” the volunteer wrote.

Squatting on the top of a hill over the Tijuana River is the four-story Casa del Migrante. The prison-like concrete building is the first stop for hundreds of men deported to Mexico each month. Sitting in his office near the interior courtyard, administrator Gilberto Martinez says he and his staff starting noticing Numi cards in 2014. Since then he says, “We’ve seen hundreds of Numi cards. Maybe one in ten get any money. If they have less than $20 on the card, they throw it away.”

My own canvass of deportees at Casa del Migrante and nine other Tijuana shelters revealed at least 10 who said they had received inmate debit cards. A few said they had lost about 40 percent of their money to fees, including two who started with more than $200. Some said they’d thrown the cards away in frustration when they couldn’t access their money.

Martin Quintana-Cerna, 28, was deported to Tijuana in April 2015 after serving a four-year prison sentence in Nevada with $9.90 on a Numi card—all he had. He appeared dazed, finding himself in an unfamiliar city in a country where he hadn’t lived since he was a child. His attempts to get pesos from an ATM in Tijuana were denied, costing him $3.45 in fees. He allowed me to check his account online. The remaining $6.45 was untouched, but it was effectively impossible for him to cash out at an ATM in Mexico given $4.95 for an international ATM fee, 3 percent for a foreign transaction, and the local ATM fee.

No More Deaths catalogued other reasons deportees were unable to use their cards. Most were given written instructions in English. Many cards had to be activated by calling an 800 number in the United States that does not work internationally. Spanish-speaking operators were rarely available on Numi’s customer-service line; English-speaking operators often refused to speak to a translator. Many deportees, told their PIN is their birthdate, didn’t realize the US practice is to put the month before the day, unlike in Latin America. Sometimes cards are secured to prison paperwork with a staple, and a puncture to a card’s magnetic strip can render it useless.

Savings Come at a Price

Although Numi markets itself as a hassle-free alternative to the cash box, the Numi card does not eliminate labor-intensive check-writing and reconciliation systems, as that is still required for hundreds of inmate transfers a month. Multnomah County issued 2,820 checks for the first 10 months of 2015, and about 8,600 debit cards. E-mails from Multnomah County show regular slip-ups, such as cards missing money, incorrect amounts entered, and cards that need to be voided. In January 2015 county-jail personnel processed dozens of voided cards and reverse charges, all of which involved a laborious manual procedure. It is an error rate more than 100 times the debit-card industry standard.

The Multnomah sheriff’s office said $4,652 went unclaimed in 2013, pre-Numi, mostly uncashed checks. But arrestees may be losing far more money now. Based on data provided by the MSCO, its jail system is loading approximately $829,000 on Numi debit cards on an annual basis. Given that more than 80 percent of cardholders pay fees, including 30 percent who never cash their card, based on the data from Santa Clara County, then tens of thousands of dollars would be lost each year. Whereas Oregon holds uncashed checks “forever for claim”—accrued interest is distributed to public schools—Numi and the issuing bank vacuum up all unclaimed funds on Numi cards. Neither the Multnomah County auditor nor the sheriff’s office could point to any savings, when asked.

In Fresno the Numi card system was in place for more than two weeks when, according to an e-mail written by Sgt. Javier Vital, the sheriff’s office discovered that Numi ICE cards for many prisoners “were lost when we sent 2 buses of inmates to prison with the cards.” There was no indication the cards were voided to refund the money, meaning maintenance fees would deplete the cards’ balance. Sgt. Vital said the county would no longer issue ICE cards to inmates being transferred to state prisons.

Dr. Schwartz says, “If the vast majority of inmates pay fees, then it’s a mandatory fee.” He says the Numi card affects the ability of former inmates to rejoin society. “When you let inmates out of jail, how do they secure transportation, food, and shelter? It’s in everyone’s interest that they succeed to the highest degree possible. The people who are locked up are not just sources of revenue.”