Bank cuts ties with private prisons

Bank of America, one of the nation’s largest financial institutions, announced it would cease lending to the private prison industry.

The decision announced Wednesday makes Bank of America the last of Wall Street’s biggest banks to cut ties with private prisons, as corporate giants wrestle with whether to cash in on business opportunities tied to President Donald Trump’s zero tolerance immigration policies, or to distance themselves amid increasing public pressure.

“The private sector is attempting to respond to public policy and government needs and demands in the absence of long standing and widely recognized reforms needed in criminal justice and immigration policies,” Bank of America said in a statement to The Washington Post. “Lacking further legal and policy clarity, and in recognition of the concerns of our employees and stakeholders in the communities we serve, it is our intention to exit these relationships.”

Dropping private prison companies is a way for banks, already targets of Democratic presidential candidates, to get out of the crossfire on another emotional issue, industry analysts have said. JPMorgan Chase and Wells Fargo made similar moves earlier this year, and U.S. Bank told The Post in March that it, too, was pulling back.

These moves come as big banks post record profits and the Trump administration rolls back regulations put in place after the global financial crisis. In 2018, Bank of America reported a record profit of $28.1 billion compared with $18 billion the previous year.

Reporting from the Miami Herald revealed in May that Bank of America was the chief financier of Caliburn, a private prison company that operates a detention center in Homestead, Florida, that holds roughly 2,300 unaccompanied migrant children. Bank of America gave Caliburn a $380 million loan, according to U.S. Securities and Exchange Commission filings, as well as a $75 million revolving credit line.