BOSTON (Reuters) – A labor union representing American academics on Friday urged pension funds to cut their publicity to investment companies which have funneled hundreds of thousands of dollars into private prisons, saying the businesses are getting wealthy on the U.S. authorities’s follow of separating migrant households.
ICE detainees are seen on the Adelanto immigration detention middle, which is run by the Geo Group Inc (GEO.N), in Adelanto, California, U.S., April 13, 2017. REUTERS/Lucy Nicholson/File Photo
The American Federation of Teachers, which influences over $1 trillion in public-teacher pension plans, revealed a report figuring out greater than two dozen companies that guess on jail operators CoreCivic Inc and GEO Group Inc and protection contractor General Dynamics Corp, which has contracts with migrant shelters. It despatched the report to pensions across the nation, warning such investments might be hazardous.
Shares of CoreCivic, previously Corrections Corporation of America, and GEO Group started climbing after Donald Trump was elected U.S. president in November 2016. They have risen extra in the final months because the Trump administration started prosecuting individuals who crossed the border illegally. Many have been put into amenities run by these corporations, and hundreds of youngsters have been separated from their mother and father.
In an attachment to the report, the academics federation names the most important buyers in private prisons, together with investment companies Hotchkis & Wiley and Geode Capital Management, in addition to hedge funds D.E. Shaw, Millennium Management and Renaissance Technologies. Some of those companies make buying and selling selections primarily utilizing pc fashions as an alternative of conducting elementary analysis on corporations.
“Hedge funds that invest in private prisons are not only profiting off a broken justice system and abetting the administration’s policies of family separation … They are also making a risky bet on an industry rightfully under siege,” American Federation of Teachers President Randi Weingarten stated.
The Geo Group launched a press release blasting the union’s stance as “outrageous and based on malicious lies … Our company has never managed facilities that house unaccompanied minors … nor have we ever provided any other services for that purpose.”
Amanda Gilchrist, a spokeswoman for CoreCivic, stated the corporate helps the federal government “provide solutions for overcrowded and potentially unsafe conditions.”
General Dynamics spokeswoman Lucy Ryan stated the corporate offered help providers however “had no role in the separation of children and families.”
Spokespeople for the fund companies both declined to remark or didn’t return messages in search of remark.
CoreCivic’s inventory worth has climbed 22.6 % in the final three months whereas GEO Group’s achieve was 7.14 % in the identical time.
Several outstanding pension funds, together with the California State Teachers Retirement System and the Chicago Teachers Pension Fund, are evaluating their investments in private prisons. Last yr New York City pension funds have been the primary to absolutely divest from the private jail business, the report stated.
The American Federation of Teachers has lengthy been important of hedge funds, calling them too costly and criticizing their lackluster returns in earlier studies.
Reporting by Svea Herbst-Bayliss; Editing by David Gregorio and Cynthia Osterman