Deputy Attorney General Sally Yates Issues Memo to Phase Out Federal Private Prisons, Citing Safety Problems and High Costs

Deputy Attorney General Sally Yates issues a memorandum directing the Bureau of Prisons (BOP) to discontinue outsourcing operations to private entities and either decline to renew contracts or substantially reduce their scope as they expire. The memo cites a comprehensive Office of Inspector General report finding that for-profit prisons are more dangerous and no less costly than public facilities. Yates writes: “Private prisons served an important role during a difficult period, but time has shown that they compare poorly to our own Bureau facilities.”

The decision follows years of evidence that private prisons cut costs by reducing medical staffing, security personnel, and educational programming—resulting in higher rates of violence, sexual abuse, and inadequate healthcare. The memo also notes that declining federal prison populations (down over three years) make private facilities less necessary. The announcement immediately sends shares of CoreCivic and GEO Group plunging, demonstrating how corporate profits depend on mass incarceration.

The Yates memo represents the first significant federal effort to reverse the privatization of incarceration that began with CCA’s founding in 1983. However, the policy only affects federal Bureau of Prisons contracts (about 22,000 beds) and does not apply to Immigration and Customs Enforcement (ICE) detention, which represents a larger and more profitable market for private prison companies. The phase-out demonstrates that reducing private prison use requires executive action because the industry’s lobbying power prevents legislative reform.