When it comes to essential financial services, persons in prison and their families are often forced to deal with organizations that charge exorbitant prices, according to the government’s predatory lending watchdog.

Consumer Financial Protection Bureau recently released a study detailing how private companies take advantage of inmates and their families—a captive market—to overpay for services like transferring money, making phone calls, and so on. When it comes to prisoners’ release money (jail wages, refunded money, and in many states, a small amount of cash to help with necessities), financial institutions are prohibited by law from making them use their services. The Bureau reminded financial institutions that they are not permitted to force government benefit recipients to use their services.

To the CFPB’s dismay, the costs of being incarcerated, from posting bail to court fees to accessing money while confined to deducting charges from benefits after release, can be unfair and harmful to both prisoners and their families at every point. They said they’ll keep looking into it. They’re particularly concerned about making sure that a person’s criminal record isn’t used to limit their future employment opportunities once they’ve been released from prison.

According to a news statement issued by CFPB Director Rohit Chopra in conjunction with the findings, “many jailed individuals and their families face outrageous fees for essential financial services.” Prisoner reentry is made more difficult when private companies interfere.

Even after an offender has fulfilled their time, the financial toll of their incarceration might linger for years. Loans may be more expensive or impossible to obtain if a person lacks a steady source of income. One study indicated that a former prisoner’s average credit score was 50 points lower than that of individuals who hadn’t served time, making it more difficult to get a job or a place to live. While in prison, debt and delinquencies build up, and payments go unpaid, resulting in a lower credit score.

Predatory Practices

The Consumer Financial Protection Bureau (CFPB) cited prepaid debit cards as an example of widespread “predatory practices.” (In October, the Bureau ordered JPay, a jail financial services business, to pay $6 million for illegally charging people exiting prison fees to access their own money.). “Reforming certain prior business practices” was what Aventiv Technologies, JPay’s parent company, said it was doing at the time.

According to the government, only a few organizations control money transfers, making it difficult for families to transfer funds to commissary accounts without incurring fees. Sending $40 to a relative in a Louisiana state prison, for example, cost families there $6.50, a 16 percent cut for the company handling the transfers.

Other instances include the ability of firms to demand exorbitant prices for inmates’ use of digital music, email, and phone calls, due to exclusive relationships with prisons.

While the CFPB’s attention is a good first step, a bigger government effort is needed, said prison reform activists.

“We need to go beyond punishing firms for lying to consumers and begin to regulate the prices they charge, the extra fees, and the poor-quality services.”. Furthermore, the Federal Trade Commission (FTC) and other government agencies must be more aggressive in pursuing criminal justice reform than the Consumer Financial Protection Bureau (CFPB) has recently been.