Friday, December 24, 2010

INSOURCING - Will Florida's new Gov. Scott fall in with the crooks...or clean them out?
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by Bob Sloan

Thu Dec 23, 2010 at 05:22:44 PM PST

Here are links to the last 4 segments in the INSOURCING series:
INSOURCING - Florida Gov. Elect trashes PRIDE for prison industry operations

INSOURCING - Stimulus funds go to Prisons - their Lobbyists accompany new lawmakers to Washington

INSOURCING - Has the main enabler to job losses and slave labor in Prison Industries been caught?

INSOURCING - How your government does not protect your jobs or prosecute PIECP Violations

Yesterday I wrote about the advice given to Florida's Governor-Elect, Rick Scott by his transition team regarding the Florida Department of Corrections (FDOC) and Florida's prison industries operated by the non-profit corporation, Prison Rehabilitative Industries and Diversified Enterprises (PRIDE of Florida). Today I'd like to continue the discussion by better explaining PRIDE's activities and business practices that have resulted in such harsh language about them by the transition team - as well as others.

In simple terms it's because this corporation once served a necessary and important service for the state. They took over a state run prison industries that was floundering and costing the taxpayers hundreds of thousands of dollars a year to fund and turned those industries around within 4 short years. From 1980 through 1990 PRIDE was held out to all other state prison operations as a glowing and shining example of how private enterprise could work hand in hand with states to address recidivism through training and hard work.

In 1999 PRIDE participated before the U.S. House of Representatives' hearing: "OPTIONS TO IMPROVE AND EXPAND FEDERAL PRISON INDUSTRIES HEARING BEFORE THE SUBCOMMITTEE ON CRIME OF THE COMMITTEE ON THE JUDICIARY HOUSE OF REPRESENTATIVES". PRIDE's General Manager of New Business Development, Michael N. Harrell (Keep Michael Harrell and Pamela Davis' name in mind as you read the rest of this segment) spoke to the committee that was chaired by Bill McCollum (R) of Florida. In that Committee hearing McCollum and others were attempting to "improve and expand the Federal Prison Industries." In fact McCollum was so proud of "his" state's prison industry operator, PRIDE, that he wanted to use PRIDE's business format as a basis for "improving" the federal prison industry. But I lost track again...PRIDE was being heralded as the pioneer in using inmate labor to produce products and lower costs for private sector manufacturers during the 1990's.

Other states began to integrate PRIDE's business plan into their own state run industries. This was the corporation that was drug store magnate Jack Eckerd's brainchild. He worked throughout the late 70's and early 1980 working with Florida's Governor and Legislature to get their approval to try his innovative approach to combining prison industry with training and a reduction in recidivism. He was successful and so was PRIDE through 1990.

During those early years Eckerd saw to it that PRIDE kept on track with the mission goals of the program he'd put into place: training of inmates in prison to reduce idleness and provide released offenders with the skills necessary to allow them to gain employment and avoid a return to prison. Eckerd also made sure PRIDE maintained an employment service for released inmates that worked with local businesses and manufacturers willing to hire ex-offenders. In addition PRIDE provided reentry assistance to those released: vouchers for tools, housing assistance, resume writing assistance. In other words back then PRIDE was totally dedicated to the mission goals set by the Legislature.

In 1990 Eckerd stepped down as Chairman of PRIDE's Board. At the same time J. Floyd Glisson also resigned from his post as President of PRIDE. At the time they both voiced opinions that they were concerned with the direction new PRIDE Administrators were taking the corporation - away from training and concentrating on profits. Both Eckerd and Glisson went on to other projects, most of which had to do with public service duties on behalf of the people of Florida.

Pam Davis succeeded Glisson and eventually took over as CEO of PRIDE. SHe was PRIDE's CEO at the time of the above-mentioned House Committee hearing. This was the pre-2000 PRIDE.

From 1999 through the present both PRIDE and the FDOC have become what can only be termed corrupt. PRIDE turned it's corporate efforts to illegal acquisitions in pursuit of more and more profits while the FDOC began a period of total anarchy. Secretary's of the FDOC from 1999 through early 2006 ran the FDOC in a manner that became openly called the "Dixie Mafia". Steroid and drug sales rings operated within the institutions, run by senior officials of the FDOC. Inmate abuse frequency escalated, staff began raping female staff members and lavish orgies were held at the state owned homes of top DOC officials. Kickbacks brought down Secretary James Crosby in February 2006 - along with his number one "road dog" A.C. Clark.

While the FDOC was busy finding ways to skim as much money as they could from taxpayers and through lucrative contracts that provided kickbacks to the top officials, PRIDE was busy doing damn near the same thing. Davis formed a number of spin-off corporations to use to launder PRIDE funds through to the benefit of she and other members of the PRIDE Board and executives involved. Davis also implemented a policy of partnering with private sector corporations under PIECP to allow the FDOC inmates to be used as laborers for those corporations. Even that wasn't enough though, and Davis and PRIDE began a plan of partnering with then stealing entire companies - literally taking every piece of equipment of her "partners", products, materials and technologies they had developed. Davis was assisted in this by her favorite cohort, legal counsel, resident agent and lobbyist, Wilbur Brewton (mentioned in yesterday's segment and named prominently in the Transition Team Report of Rick Scott). The plan worked by PRIDE having the "partners" move all equipment and supplies into one of the prison industry facilities upon prison property. Once PRIDE staff learned the production process completely, PRIDE would accuse the partner of owing them money, kick them off the property and Wilbur Brewton would then file suit against the former partners and inundate them with motions, discovery demands and stall long enough until the former partners spent all the money they had to file counter suits and prosecute those and defend PRIDE's false charges. This was a good plan, as without equipment, materials or supplies to keep their operation going, these businesses quickly ran out of money to fight the takeover and theft. End result; PRIDE kept everything and continued operations on their own.

The connection between PRIDE and FDOC were not just the inmates kept by one and worked by the other...Crosby as Secretary of the prison system also sat upon the Board of PRIDE - alongside Pam Davis. In that capacity he had the authority to remove all of PRIDE's partners from the state prison property and the staff to keep them from ever gaining access again - to the prison property or their equipment, materials or supplies.

In 1999 Davis served upon or within PRIDE and all of the spin-offs she'd helped fund and form. She also sat on the boards of the Florida Chamber of Commerce, Florida Tax Watch and had served as a director of the NCIA and that year she was serving as the Treasurer of that organization. She was also named to the Florida Council of 100 by Governor Bush.

From 1999 through 2005 the situation in Florida was that crooks were being guarded by crooks and being worked by other crooks - Crooks Crooks and Crooks? sounds like a law firm PRIDE had at one time before switching to Greenberg Traurig, or as I prefer to say, "Do, We Cheat'em and How". How the hell does that kind of thing work!? I mean what is up with that?

In 2005 the Governor's IG issued a report critical of PRIDE about the spin-offs and no-bid contracts between both. This resulted in the resignation of CEO Davis, President Bruells, CFO Robert Smith and several other PRIDE executive staff. After the report came out Governor Bush demanded the entire Board of Directors (appointed by the Governor) resign. Guess what? They had enough pull with the Legislature and at the Executive level through lobbyist Brewton that PRIDE and the Board thumbed their nose at Bush and told him in essence, to pound salt.

In 2006 the indictments of Crosby and Clark were issued and they were arrested, later accepting reduced prison sentences in exchange for guilty pleas. Davis and the rest of PRIDE avoided any prosecution by the state and were still able to avoid public exposure about their thefts of the 5 Florida businesses under the PIECP partnerships.

James McDonough was appointed by Governor Bush to take Crosby's position as Secretary of the FDOC. The Governor also replaced 5 of the PRIDE Board in January of 06, when their terms expired. Jack Edgemon was chosen from within PRIDE as the new President. The CEO position was left open. McDonough was expected to clean up the corruption in the FDOC and Edgemon was supposed to do the same thing with PRIDE. One succeeded too well and the other chose instead to cut himself - and his family - in on the money flowing through PRIDE.

McDonough went through the FDOC like a whirlwind; 20+ senior and many more mid-level staffers were given the boot. From 2006 through early 2008 James McDonough gained many supporters and accolades from the Legislature and public for cleaning up the FDOC. He believed the corruption had been eradicated from the Department within months of taking over and he turned his eye toward PRIDE where he also held a seat upon the Board.

PRIDE's President Edgemon took the low road. He upped his salary and instead of cleaning up PRIDE's situation involving the theft of the companies they stole, he approved the funding by his son-in-law of two for profit corporations - Century Meats and Circle A Brands - to be run by another former PRIDE employee. These companies took the place as PRIDE's business partner in the food processing industry operation, replacing ATL Industries (who they stole the business from). In addition, PRIDE worked closely with former ATL customers to help Century meats and Circle A to take over the federal and private contracts held by ATL. This effectively put ATL out of business and money to continue to battle them in Court.

In 2006 McDonough ordered his Inspector General to open an investigation into allegations I had provided to him concerning PRIDE. McDonough is a non-nonsense kind of guy and in responding to my allegations he asked for documentation and input as to what I thought needed to be done to fulfill PRIDE's role in training and reentry since that was their mission goal.

I provided the documents I had along with a plan that outlined my suggestions of replacing the entire PRIDE Board or the FDOC taking over the prison industries entirely. I told him the one thing that needed to be done was taking the PIECP certificate back from PRIDE.

Twice in 06 I met with Secretary McDonough at the PRIDE Board meetings and in between we corresponded about our concerns regarding PRIDE. In September 2007 the FDOC IG completed the PRIDE investigation and submitted it to McDonough. He resigned that same month from the PRIDE Board. In October he openly called upon the Governor and Legislature to abolish PRIDE and turn the prison industries and the PIECP certificate over to the FDOC. In addition McDonough demanded several million dollars in room and board deductions from PRIDE that they had taken out of the wages of inmates under PIECP and were supposed to turn over to the FDOC. The Governor agreed with McDonough and the Legislature threw a fit. When the dust settled, Secretary McDonough retired, the PIE Certificate was ordered turned back over to the FDOC and legislation was enacted on the issue of allowing the FDOC to operate the prison industries.

From 2007 to 2009 many things occurred that reinforced the concerns demonstrated by myself and Secretary McDonough: One of the companies stolen by PRIDE received a judgment against PRIDE's spin-off, Global Outsourcing (Pam Davis was the President of that one, Brewton was the attorney and resident agent of Global) for $31 million. Named in the suit? Davis and Mr. Mike Harrell (who gave testimony about PRIDE's successes at the House Sub-Comittee hearing in 1999). PRIDE hired Greenberg Traurig as their representative in one of the stolen business cases. Secretary McNeil that replaced McDonough has defied Governor Crist's demand that the FDOC take back the PIE Certificate, citing Departmental financial restraints (lest we forget, McNeil also holds McDonough's old seat on the Board of PRIDE and following his refusal to take back the certificate, PRIDE's Board in 2009 voted him the "best Secretary the FDOC has ever had").

So the important Certificate remains with and under the control of, PRIDE. Some wonder why this Certificate is worth fighting over when PRIDE only "trains" 2% or less of the inmates in FDOC and they're a "non-profit" corporation. Why put up such a battle over less than 2% of the inmates? Well because that certificate can only be held by one entity in the state issued and whoever holds it has control over which industries fall under PIECP and also over PIE industries being operated by private prison industries. The certificate allows PRIDE to sell their products upon the open markets of Florida and the holder of that certificate controls all PIECP operations in the state. Power, money and influence is attached to that piece of paper issued by the U.S. Department of Justice.

Complaints and documents I sent to Florida's Attorney General, Bill McCollum (yeah, that's right the same McCollum who chaired the House Sub-Committee Hearing back in '99) were forwarded by him to PRIDE's General Counsel, Ron LaFace (of Greenberg Traurig fame). Named in those documents were LaFace and PRIDE's long time spokesman and legislative liaison, Foster Harbin. I accused both of illegal or improper lobbying for PRIDE to amend a Florida statute to the benefit of PRIDE. Within days of receiving my complaint and the documents from McCollum, both LaFace and Harbin resigned their positions with PRIDE. And the crème de la crème? PRIDE hired Brewton back as their General Counsel. Now he is their resident agent, general counsel, lobbyists and sits on PRIDE's Board of Directors!

As I quoted from the Transition Team report yesterday, none of that legislation has made it out of committee, through "obstruction" provided by PRIDE's lobbyists in Tallahassee.

McDonough was able to clean up a huge state department rife with all classes of corruption, 28,000 employees and 100,000 inmates...but when he tried to clean up PRIDE - he ran into a brick wall and ultimately became another victim to their influence and power in the state capitol.

Now several years later, the F.B.I. and the Bureau of Justice Assistance are both investigating PRIDE and I certainly hope their findings result in mandatory prosecutions and a disbanding of the entire corporation.

So in the end all the important and influential players have taken up their positions within PRIDE and the FDOC. The incoming Governor's transition team is calling for reform of the FDOC and PRIDE and that the FDOC or state take back the PIECP certificate. This looks like it could become a nasty fight in the upcoming Florida Assembly - or will it? Scott is already known as purportedly being corrupt for defrauding Medicare through his business, so will he clean up both the department and PRIDE...or will he fall in with them?

Why should any of this matter to you? Because if you live in Florida thousands of your jobs have already been lost to or because of prison labor. If you live in any of the other 41 states operating under may have already lost one of the other thousands of jobs that have gone to prisoners...

Answer the poll and let me know

Will Rick Scott abolish PRIDE and clean up the FDOC? Or will he join them in further scamming Florida taxpayers?

Scott will clean up FDOC and PRIDE.
Scott will try, but fail because of PRIDE's influence with the legislature
Scott will ignore the advise of his transition team and leave both FDOC and PRIDE alone
Scott will cut himself into the corruption and money made from it.
Scott will resurrect and become the new head of the "Dixie Mafia".
I don't know
None of the above
| 29 votes | Results
COMMENTS to DK diary below

Tip Jar (15+ / 0-)
"Inmates should be reformed...not recycled"

by Bob Sloan on Thu Dec 23, 2010 at 05:22:42 PM PST
[ Reply to This ]
What an amazing diary. (8+ / 0-)
I am left wondering if one of the companies PRIDE 'installed' was yours?

I call insourcing OnShoring Labor.

The issue of private prisons and prison labor for profit and being the country with the highest percentage of incarcerated is really, really chilling.

You might enjoy this diary with a list of states and what their prisoners make:

Onshore Manufacturing - Cheap Prison Labor

by War on Error [Unsubscribe] [Edit Diary]

Sun Dec 21, 2008 at 08:53:06 AM PST

It's difficult to be happy knowing so many suffer. We must unite.

by War on Error on Thu Dec 23, 2010 at 06:03:55 PM PST
[ Reply to This | RecommendHide ]
Thanks and I read your diary linked above (5+ / 0-)
I read it and have to ask some of the same questions myself over and over again. Still haven't gotten a realistic answer to most.

This is why I didn't go near Onshoring when I began the series. These folks are busily trying to hook up small private sector companies with prison industries closest to their operation, so prison labor can replace their labor need.

They're prison labor brokers! Hard to believe anyone would choose that for an occupation, huh?

"Inmates should be reformed...not recycled"

by Bob Sloan on Thu Dec 23, 2010 at 06:20:50 PM PST
[ Parent | Reply to This | ]
Absolutely sick. (2+ / 0-)
Wonder what they're business card say on it...probably something stupid like

John Smith
Labor Infrastructure Analyst
US Prisons

You know what would be cool Bob....setting journalism students all across America on this story. Have them go to local area prisons and confront wardens regarding stories of prison labor. Then post the videos on facebook and youtube and political blogs, or maybe even send it in to their local television stations.

Hmmm...wonder if Mike Stark is still around. That dude is pretty aggressive with the confronting.

Sigh. Just thinking outside the box.

Hope you're doing well tonight Bob.

Bob Sloan: INSOURCING Slavery in the land of the free

by cosbo on Thu Dec 23, 2010 at 09:13:17 PM PST
[ Parent | Reply to This | RecommendHide ]
Thanks for stopping by and dropping (1+ / 0-)
such a neat suggestion. I wish I were able to coordinate something like that - journalism students.

However, it takes the mainstream media outlets with the most viewers to help get the work out, and they're mostly held by a few and won't say anything to upset owners - who may just have money invested in the likes of CCA.

Trying to get Christmas stuff done so Sunday I can put that behind - one more time, sigh...

"Inmates should be reformed...not recycled"

by Bob Sloan on Fri Dec 24, 2010 at 08:35:44 AM PST
[ Parent | Reply to This | ]
I wonder if the goal (0+ / 0-)
is to create a 'kinetic' system.

If prisons continue, and then succeed in bringing all the services needed to run/maintain the prison inside the prisons, they become a sort of "independent nation' operating within the communities they reside.

What is clear and impossible to defend is the reality, which your diary clearly points out, is that the US has created a huge Prison Industry.

Think about this. Robber Barons created/amassed great wealth with 'resources' that are freely provided by the earth, less the cost of extracting the resources.

Prisoners are a 'freely provided resource' for those morally bankrupt enough to profit from them.

Via poverty and neglect, the US 'manufactures' a 'cradle to prison' resource.

When will we the people be willing to push back against all that enables this travesty?

It's difficult to be happy knowing so many suffer. We must unite.

by War on Error on Fri Dec 24, 2010 at 08:31:47 AM PST
[ Parent | Reply to This | RecommendHide ]
We're pushing War on Error...we're pushing (1+ / 0-)
hard but it's all uphill right now. Many states have come to the conclusion that putting more and more in prison and using them for slave labor is not as cost efficient as previously. Some states have come to understand the real cost of prison labor is still borne by the taxpayers. I know they claim "prison industries are self sufficient, we take no tax dollars to fun our operations", etc. But...we taxpayers pay for the housing, clothing, feeding, medical and every other need inmates have. Once they walk out the cell door and go to work in the prison, the money they earn goes right back into the industry as profits...with their meager checks going into accounts so they can go to the stores and buy commissary that is sold by another corporation.

So we are paying for the total upkeep of the prison labor force with our funding. We keep their workers fed and ready to work.

"Inmates should be reformed...not recycled"

by Bob Sloan on Fri Dec 24, 2010 at 08:41:02 AM PST
[ Parent | Reply to This | ]
Why do images of... (3+ / 0-)
"Brubaker" and "Shawshank Redemption" spring to mind after reading this?!

In an insane society, the sane man would appear insane

by TampaCPA on Thu Dec 23, 2010 at 06:15:22 PM PST
[ Reply to This | RecommendHide ]
Hmmmm maybe because all of the players (3+ / 0-)
named in the diary watched both and that's where they got their ideas from? ;)

"Inmates should be reformed...not recycled"

by Bob Sloan on Thu Dec 23, 2010 at 06:22:05 PM PST
[ Parent | Reply to This | ]
Shouldn't this be done by the state? (2+ / 0-)
Why can't the states be in charge of their own prison systems? The whole community has a stake in this so it should administered by the state with auditors to make sure the goals of humane incarceration w/ rehabilitation takes place.
I find it hard to believe that the state could be as corrupt as these for profit scum suckers.

What do we want? Universal health care! When do we want it? Now!

by cagernant on Thu Dec 23, 2010 at 09:41:23 PM PST
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As I said in a response to GUGA below (0+ / 0-)
Scott just chose someone from the most corrupt of legal firms involved in assisting PRIDE - Greenberg Traurig - as his "Special Counsel" to oversee the Governor's Legislative agenda.

So the arguments put forth by his transition team appears to have gone up his nose rather than into his ear...the GT firm represents the very prison industry corporation that is causing all the problems (PRIDE) and he picks from that group? PRIDE is on safe ground, me thinks. So cleaning up the FDOC is nothing compared to what needs to be done with PRIDE and if he doesn't clean up both one will just feed off of the other.

"Inmates should be reformed...not recycled"

by Bob Sloan on Fri Dec 24, 2010 at 08:50:40 AM PST
[ Parent | Reply to This | ]
He was fined for fraud (1+ / 0-)
he stole money from Medicare. Instead of being in jail he is the governor.

Who do you think he will side with? The taxpayers of the crooks?

by GUGA on Fri Dec 24, 2010 at 05:15:01 AM PST
[ Reply to This | RecommendHide ]
Well I was holding out hope for his cleaning (0+ / 0-)
up the corruption...but sadly a news article was just released saying he has chosen a lobbyist from Greenberg Traurig as Special counsel :(.

"Scott appointed Hayden Dempsey, the former Bush aide, as special counsel to the governor who will also oversee Scott's legislative agenda. Dempsey is a lawyer and lobbyist at Greenberg Traurig and represented 13 clients before the legislature last year, including many health care concerns."So it looks to me that he wants to cut himself in on the free flow of tax money in Florida.

Such a shame, I really was hoping he would be different. Should have know by his brand (R)...

"Inmates should be reformed...not recycled"

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