In the days after Donald Trump’s election, business leaders across a swath of industries celebrated the victory of a man they thought would bring them a financial bonanza. Crypto bros, oil and gas honchos, and tycoons looking to orchestrate mergers all did a victory dance.
Now, a new report details how private equity companies — operating in relative obscurity — stand to benefit too. Trump’s promised mass deportation campaign will enrich private equity companies, according to a new report released Wednesday by a watchdog organization tracing the industry’s far-reaching involvement in the business of detention and deportation.
“Declaring an emergency opens up all these avenues for companies to rush in without the proper vetting.”
“Trump is pretty set on expanding the deportation and detention system, he is pretty set on declaring a national emergency, and as shown in the report, declaring an emergency opens up all these avenues for companies to rush in without the proper vetting,” said Azani Creeks, the senior research and campaign coordinator at the Private Equity Stakeholder Project. “The companies with the most power and the most money will win those contracts — so that will be private equity firms.”
Public to Private
For years, advocates concerned about private industry’s role in immigration have focused their ire at two large, publicly traded companies that dominate the business of owning and operating lock-ups for immigrants.
Those companies, Geo Group and CoreCivic, both saw their stocks soar after Trump’s election on the expectation that he will follow through on his pledge to deport millions of people.
While private prison operators might play top dog at many detention facilities, advocates say they are only one part of a constellation of companies that stand to profit off deportation. Some companies are simply privately held, but a growing number are owned by private equity firms.
Those firms do not offer stock to the general public, instead collecting investments from pension funds and other institutional funders to buy companies they believe are undervalued. Sometimes they make structural changes and sell their acquisition targets for a profit. Sometimes, they slash expenses by firing employees and use the companies they have purchased as piggy banks by issuing debt in their name.
Unlike publicly traded companies, which must disclose certain financial information, there is little visibility into the world of private equity.
Creeks said that while some publicly traded companies pull back from operating in the detention and deportation world under public pressure, private equity firms have rushed in to fill the void. Some 63 percent of federally designated immigration detention facilities contract with companies owned by private equity firms, according to the report.
Asked for comment by The Intercept, none of the firms listed in the report that are mentioned in this story provided one.
Read full report
Guess Who Profits From Trump’s Deportation Plan? Private Equity Firms.
