By Rebecca Boone
Associated Press
BOISE, Idaho — The U.S. Justice Department has declined to press criminal charges in connection with an investigation into allegations of contract fraud and public corruption at a private prison in Idaho.
The FBI began investigating the Idaho Correctional Center last year. The facility had been run by Corrections Corporation of America and was known for being so violent that inmates dubbed it “Gladiator School.”
The company had been accused of knowingly understaffing the prison and falsifying records to cover up thousands of hours of vacant guard posts.
The DOJ investigation looked into whether the company defrauded the state under its $29 million annual contract and whether state officials tried to delay or prevent an investigation into the matter.
U.S. Attorney Wendy Olson said Wednesday that the probe was complete, and the agency didn’t find probable cause to file charges.
Olson said the review showed that some Corrections Corporation of America employees falsified staffing reports, but they were relatively low-level workers. No one at the assistant warden position or higher was aware of the fraud at the time it was committed, the investigation found.
Additionally, she said, the employees responsible for billing didn’t know about the false reports, and since the prison company was paid based on number of inmates — not number of guards — there wasn’t direct evidence that the fraud was intended for financial gain.
There also was no evidence anyone with the Idaho State Police, the Idaho Department of Correction or the governor’s office sought to delay, hinder or corruptly influence a state investigation into the staffing allegations, Olson said.
She said a series of miscommunications and incorrect assumptions between agencies made it seem that there were improper obstacles to an internal probe and led to reporters and a federal judge receiving erroneous information.
“While these miscommunications ultimately gave rise to suspicion of an effort to delay, hinder or influence a state criminal investigation, such miscommunications, unsupported by any other evidence, do not rise to the level of criminal misconduct,” Olson said.
The Idaho State Police Department was originally asked to investigate operations at the prison in 2013 after an Associated Press investigation showed the company was giving state officials falsified documents to cover up thousands of hours of understaffing.
The FBI took over after the probe failed to launch for more than a year. At the time, internal police documents showed the state law enforcement agency had a potential conflict of interest in the case.
Corrections Corporation of America had operated the prison south of Boise for more than a decade, but after the falsified staffing documents were uncovered, the state correction’s department hired an auditing firm to determine how many hours the prison was understaffed in violation of the company’s contract.
The auditing firm determined the Nashville, Tennessee-based private prison company left more than 26,000 hours of mandatory guard posts understaffed or inadequately covered during 2012, though the Corrections Corporation of America disputed those numbers as inflated.
Still, Idaho Gov. C.L. “Butch” Otter reached a settlement agreement with the company in 2014 — long before any law enforcement investigation had been completed.
Under the settlement, Corrections Corporation of America agreed to pay the state of Idaho $1 million. In exchange, Idaho dropped any right to sue over staffing.