Prepaid Card System for Prisoners: Streamlining Money Management in Finnish Prisons

1. Eija-Riitta Nelin eija-riitta.nelin@om.fi

2. CriminalSanctionsAgency • Finland is divided into three criminal sanctions regions based on the regional population development and prison population rate • The aim is to place prisoners as near as possible to their place of residence • Each region has approximately 1 000 prisoner places • The daily number or community sanctions enforced in the regions varies between 1 000 and 1500

3. CriminalSanctionsregions

4. Background for the need of the prepaidcard • Everyprisonhadtheirownsystem and cashier for handlinginmates money. • CSA hadone common bankaccount for allincoming money for inmates, and eventhatwehadadvicedthateverytransfershouldhave at leastthisinformation: prisonersname, birthday,prisonnumber and prison. Stilltherewheretransfers with messageslikethis: ”HappyBirthday Matti Wishesfrommother!”. • Ifinmatechangedprison, oldprisonhad to sendinformationabout the money to the new prison, thereweretwobalances per inmate; own money (possible to use 140 € per month) and money earned in prison (no restricition for use). The informationwassend via email, fax and traditionalmail. • The Finnish Government Shared Services Centre for Finance and HR (Palkeet) had to do daily the balance sheet check and inform every prison about the money. Sometimes they “remembered that this person was at Helsinki prison last time, and they did the transfer, which might be old information). • Cost for balance sheet check and paying inmate’s invoices was over 150.000 € annually • When the inmatewasreleasedwehad to calculatealsofutureincomes in advance and payall the money in cash. • Wewantedcardto beprepaidsothattherewon’tberisk of overdraft • Westarted to payallowances and salaries for open prisoninmates at beginning of 2014 to theirownbankaccounts. • But for inmateswhodidnothaveorwereunable to have a bankaccountwehad to paytheirallowances to bankbypaymentorder. • If the inmatedidnothave an identificationcard, ourofficershad to go to the bank with a specialpermission and do the cash withdrawal • Inmates did not receive payment orders same day and we had to take inmates to bank many times. • When inmates were released, it was usual that they did not pick the money from payment orders and nearly 20% of the cash was returned to us after 45 days. And we tried to do it again and again.

5. CSA’srequirements for prepaidcard • One system for all the prison money • Everycardshouldhaveown IBAN (relatives and authoritiescansend money directly to the prisoner) • Prisonerscanuseprepaidcardboth in prison and also outside prison. • CSA canpayinmate´sinvoices and transfer money fromprepaidcard to ownaccountorsomeotheraccount. • CSA canpayallowances and salariesdirectly to eachcardaccording to paymentscheduleevenafter release • Onlydeportedprisonersshallhaveall the money thattheyhave at theircardwhenleaving and still in cash as well as thoseinmatesthatweremoved to other country to continuetheirsentence • Inmatescanuse the prepaidcardduring the release month plus threefullmonthsafter.

6. Incoming money to prison • Ifinmatehascashwhen he arrives to a closedprison, wetake the cashfrom the inmate and put the money to a prepaidcard and then the inmatescanusetheir money rightaway. • Inmategetshis PIN and wetellthemtheir IBAN and BIC codesothat he caninform the partieswhowillsendthemmoney. Officerscannotgivethatinformationand inmateshave to givetheir IBAN and BIC codethemselvesto the partiesthatsendthem money. • Earlier the Prison Act didnotallow money oranyinstrument of payment at closedprison on inmate´spossesion. Noweventhat the lawchanged, wedonotgivecardsdirectly to inmates in closedprisons. Insteadwhentheyneed to paycanteenpurchases, theircardsarehanded to them for the duration of the purchase. This is a safetymeasure. • Prisonsdonotallowvisitors to bring money to prisonsafter CSA started to useprepaidcards. Onlyexception is, thatifsomeonebrings money for the inmate to payfines. • Beforeprepaidcards, inmatesreceivedlargequantities of cash in letters. Now the amount of cashlettershasdecreased, buttherearestillinmatesthatdoreceivethem. • In the beginningwethoughtthatwecanclose the common account for all the prisons, butwehavenotbeenable to close it. • Notall the muncipalitiesareable to pay to IrishIban (the companyproviding the service is EnglishcompanybutvirtualIban for Barclay Bank areIrish) , theirallowancepayingsystemsdonothave SEPA capability • If the cardholder is on a sanctionlist (OFAC list is the one, thatbanksdowant to obeyit, but for us the lawsaysthatwecannotpreventanypaymentsfrom the card and to the card), wehave to allowinmate´srelatives to send money to common prisonaccount and wewilltransfer the money to inmate’scard. • If the relativeswant to send money to inmate outside SEPA, theyhave to send to CSA’saccount.

7. Can every inmate get a prepaid card, even those who have no certain identity or multiple identities? And what about those who are going to be expelled from the country? • Everyinmatewhocomes to CSA throughtwootherauthorities: policeand the judiciarywhichhavechecked the inmatesindentity. • CSA checkswhichmethod of identificationhavebeendone. • There is a note in Prisoninformationsystem (VATI) whohas made the identification and fromwhichdocument • Ifwelaterfindthat the personalityinformationhaschangedwechangeitalso to VATI and MACP (cardsystemadmistrationtool) • Ifwecannotidentify an inmate, therewillbesomerestrictions for the cardusage (wewillnotallow outside transfers to the card, and theywon’tget a cardaftertheir release)

8. Afterinmate is released • If an inmate is released and informs us abouthisownpersonalbankaccount, wetransfer money fromhisprepaidcard to hisownbankaccount. Alsounpaidallowances,salaries and unusedphonecreditswillbedepositeddirectly to hispersonalbankaccount. • If an inmatedoesnotgivehisownpersonalbankaccountdetails, and willbereleased to Finland oranyother SEPA country, he cankeep the prepaidcard and itwillbevalid the releasementmonth plus 3 months. • Wewillnormallypaytwice the allowances and salariesafter the releasementaccording to the paymentschedule. Salaries and allowancesarepaidtwice a month at open prisons and once a month at closedprisons.

9. Limitations in usage of cards. • CSA hasnotenforcedanylimits to the money usage inside the prisonsaftertaking the prepaidcardsystemin use. • Prepaid Financial Services ”PFS” (the serviceprovider) has set somelimits (some of those CSA havechosen) for the cards: • Maximum threedeposits per day • POS usagemaximum 6.000 € per day • Maximum deposit 5.000 € per day • Minimumdeposit 0,01 € • Maximum balance at card 15.000€ ( Sofar, no onehashadthismuch money at hiscard) • Maximun ATM withdrawal per day 3.000 €

10. What happens if there still is money on the card after that three months has passed after the conditional release? • CSA willsend a letter for all the cardholdersthathavemorethan 50 € left and ask for accountinformation. Ifwecannotfindtheiraddressinformation, wearenotable to send the letter. If the releasedinmatetells us hispersonalbankaccountnumber, wewilltransfer the money to thataccount. Unfortenatelymany of the cardholdersdonotanswer to us, evenaftertheygot the letter. • To everycardholderthatreturns to prisonwewilltransfer money to a new card (thishasbeendonefrom the beginning) • Best solutionwouldbe, that CSA wouldgetinmatespersonalbankaccountinformationbefore the inmate is released and wecouldtransfer the money from the card in advance and lastallowanceswouldbepaid to formerinmatespersonalbankaccount. • At the momentclosedcardshavealltogetherover 70.000€

11. How often do the inmates get their salary? • Open prisonsinmateshavetwopaydays per month • Earningperiod is from 1st of the monthtill 15th and the secondperiod of the month is from 16th till the end of the month. • At closedprisonsinmateshaveonepayday per month • Earningperiod is from 22nd of lastmonthuntil the 21st of thismonth • CSA started to payaccording to the paymentscheduleall the salaries for open prisons at the sametimewhenwestarted to pay to inmate’sownpersonalbankaccount at beginning of 2014. • In May 2016 CSA started to payallowances and salaries to prepaidcards for all the closedprisoninmates and allthose open prison’sinmateswhohavenotgiventheirownpersonalbankaccountnumberand alsoaccording to the paymentschedule. • Evenwhen the inmate is released, wewillpay the allowances and salariesaccording to the paymentscheduleeither to hisownbankaccountor to hisprepaidcard. Onlyexceptionsare the inmateswhogetdeported outside the SEPA areaoriftheywillcontinuetheirsentence in othercountry’sprison.

12. What if the inmates lose their cards or forget the code to the card? • If the cardholder is still in a prison, we will give him a new card and transfer details (and the money) from old card, so that IBAN stays the same, but PIN and card number will change • We put to MACP´s NOTES field (card administration system) information about new and old card, so that it is easier to follow. • If the inmate is allready released we ask them to contact the nearest prison. • If released prisoner tells us his own personal bank account we rather remove the funds from prepaid card to his own bank account and put his own IBAN also to VATI (prison information system). • Releasedprisonerscanalsocall to Prepaid Financial Services Ltd customerservice and ask the money to besend to hisprivatebankaccount.

13. Is the system easy to administrate? • Manyfunctionsareeasy • change DC code (prisoncode) • putneededinformation to the system (allfirstnames, lastname, birthdate, prisonnumber, prison) • Transferdetailsfromoldcard to new card • Payinvoicesortransfer money • Takebalancelist for all the inmates in sameprison (if the DC codechangehaschanged) • Taketransaction for individualcardholder • Takebankstatement per oneprison for eachinmate • It is easy to make a note (butnoteveryoneremembers to makeit) • Someofficerswere at first a littlebitworried, because MACP is in English (wedohaveinstructions in Finnish) • New lawdoesnotallowofficers to seetransactionsafterreleasement and that is whycardholderscancall to PFS customerservice. Administrativeusersseeonly the balance of eachcard in status list, and the card status.

14. What happens with the money that the inmates are carrying with them upon arrival in a prison? The money goes to the card but what about the actual cash? • CSA have a limit (credit) at E-wallet for 50.000 € sothatwecandepositall the cashthat the inmatebrings with him to the prison. • The actualcashwillbeput to a safe and if the amount of money in the safe is over the Cashierinstruction. Wewilltakeit to the bank and deposit to CSA’sbankaccount. Where are the actual cards stored inside the prison? • Itdepends on a prison. The mostusualway is to have a file for eachward for cardsin an alphabeticalorder (cardsare in pockets) and someprisonsdohavelockedboxes for cards (wedonotknowtheir PIN codes) • Wehaveputindividualname and inmatenumber to eachcard with a stickerorweuse a permanentmarker (everycardhas common text ”RISE.” as a name; Rise is the firstname and . (dot) as a familyname)

15. How much does the system cost? Licenses etc. • Implementationfee • Developmentwork (wehavehourlycost and itdependshowmuchtimedevelopmenttakes per eachassignment) • Monthlycosts (normallybetween 3.000 € and 5.000 €) includes: • EachReloadableCard and postage (whenweorderthem) • Bank Transfersfrom Web (wepayinmate´sinvoices) • POS TransactionFees outside Finland • ATM in Finland (certainfee for eachwithdrawal) • ATM Transactions outside Finland (certainpercentage of the totalamount) • EachIBAN transfer(negotiatedmaximumamount per month) • Eachreturned IBAN transfer(eachtransferhave a certaincost) • Chargefor PreFunding (negotiatedpercentage per month)

16. Is it possible for the inmates to pay invoices with the help of the card?Can the inmates wire money to relatives etc? • At the momentofficers help cardholders to payinvoices and transfer money to another IBAN in MACP (cardadmininstrationsystem) ifweget a writteninquiryformfrominmate and prisondirectorhasaccept the payment. • In the futurecardholders in open prison and releasedinmatescanpayinvoicesthemselves, transfer money and checkthe transactions and the balance at cardholderportal, (CCP) • At closedprisonswewillnotallowprisoners to payinvoicesthemselves in the future; officerswilldothat and director of the prisonwillalwayscheck in advanceifwecanallow it. • At closedprisoninmateswillonlyseetheirbalance and transactions at CCP (cardholderportal) whenoursystem is ready and havepc’s for it.

17. Is there an easy way for the inmates to see how much money they have on the card? • If the cardholder is still at a prison CSA officersgivethemthatinformation. Everyinmategetthisinformationonce a weeksothattheyknowhowmuchtheycanbuyfromcanteen. • In the nearfuture CCP will help cardholders to check the balancethemselvesiftheycanaccess the internet (releasedprisoners and prisoners in open prisons) • At closedprisonswedonotyethaveenoughcomputers for thatpurpose (at the momentthere is onlyone pc per prison, and it is mainly for educationpurposes) • The most common ATM operator (”OTTO”) in Finland doesnotgive the balanceinformation • ATM operator ”NOSTO” gives the information of the balancebutit is notyet as common as ATM OTTO • Customerservice of PFS cantelltheirbalance (for releasedinmates and inmates in open prisons)

18. Can the inmates relatives send money to the account connected to the prepaid card using mobile pay or other similar services? • In Finland mobile pay is a new technology and it is tooearly to comment on it • Relativescanmake SEPA transactions via internet banking and iftheydoitduringofficehours, the money willbe at cardholders IBAN nextworkingday at noon. • Wedonothave a quickermethodthanoneworkingday, if the money is comingfromother IBAN • Cardscanbeused in other SEPA countries (itwasallowedfromend of September 2016) • Relativeshavebeenable to send the inmates money from the beginning. At the starttherewere a fewproblemsbutmost of the bankshavenothadanyproblems at all. • Ifsomeonetries to send an express foreignpayment, itdoesnotwork, it just has to be an ordinary SEPA payment.

19. What are the main struggles with the system? • At firstwedidnothaveenoughuserlicences in the system. Nowwehaveover 1.000 users (officers). • At firstthereweresomeculturaldifferences with PFS • At firstwedidnothave a goodcontact person, shewasFinnishbutnotqualified. From August 2016 wehavehadverygoodcontact person who is Finnish and shehasgoodexperience for banking. Butsheleft the company and therewasabouttwomonthstimethatwedidnothave a finnishspeakingcontact person, butnowwehave a new contact person. • Big problem at firstwasalso, thatwecouldnotchangeprison DC code; thatfunctionwasavailable at end of September 2016 • At firstwecouldnottransferdetailsfromoldcard, and wehad to create a new oneeverytime. • Wecannotprintreceipts, whenwepaycardholdersinvoices, buttheycanseeitfrombankstatement • Some of ourofficersexperienceEnglishlanguage as a difficulty

20. Moretroubles at the system • Youcannotusescandinavianalphabets Ä, Ö and Å. Alsowecannotuseanyotheraccentslike ê, ü,é etc. • CardholderscannotgettheirbalancesfromFinnishATM OTTO, theyhavebeenable to getitfrom NOSTO ATM sincelastautumn. • Money comes to cardafter11:00 AM on workingdays(englishtime 9:00 AM) • Ifofficertransfersmoney orpaysinvoices, the onlysignwillbe the Internet Explorer´saddresslineplanetcircling.Thatis whytherehavebeencaseswhen the sametransferhasbeen made severaltimes. • Cardscanbeused in other SEPA countries (itwasallowedfromend of September 2016 (This is a goodthing, not a trouble) • Relativescannotsend money outside the SEPA area and alsopayments to outside SEPA areacannotbe made from the system

21. Problem with supplementarybenefitfrommunicipalities • CSA wasplanning to close common prisonaccountafter a month of useage of prepaidcard (for saving money and reducingwork to find out whose money there is) • Municipalitiespaymentsystemsarenot SEPA capable, and the problem is becauseprepaidcardshaveIrish IBAN • Therearesomemunicipalitiesthatcanpaybenefitsdirectly to cards. • CSA wasnotprepared to thisproblem, becauseallgovermentssystemshad to be SEPA capablesince 2010. • The benefitsthat Social Insurance Institutionpays, comesdirectly to prepaidcards(most of the benefitscomesfrom Social institution, notfrommuncipalitiesnowadays,itchanged in the beginning of 2017)

22. E-walletfunctionality Limit is 50.000 € (at firstwehadlittleproblems with this). • CSA makesdirectpaymenteveryThursdaybefore 14:00 PM to reduceusedlimit. Itwillbepaid with help of Palkeet at samedaypayment data. Palkeet willsignthattheyhavepaiditsameday. • Normallytransfer to pay the limit is between 12.000 €- 28.000 € - Averagepayment is 21.000 €. Transferwillpaymake to Barclay’scustomerassetaccount. Wewillsendmessage to PFS cardfundingteam, thatthisamount of money is coming to You. • Normally the amountwillbeseenafternoon on the sameday at E-wallet. Southern District is making the payments and checksalsoE-walletsituation. • In international paymenttrafficit is problematic with Bank holidays.Eventhatweareaware of EnglishBank holidays, theremightbedelays. Butitwillnotbeproblematic to inmates, becausewealwayshaveenoughlimit to beable to puttheirown money to theircards. • CSA haschose to havelimitsothattherearenotunboundedfunds at E-wallet. State Treasurydidadvice us to workthisway. Weuselimitsothatweareable to put the cash money directily to prepaidcardwheninmatearrives to closedprison.

23. Sanctionsmatter • Ifwehave international prisonerthat is on OFAC sanctionslist, bankdoesnotallowdirecttransfersbutwecannotrestrict (it is againstFinnishlaw) so the money comesstill via old common prison money account. • Wehavehadinmatesthatwerein National sanctionslist for a shortperiod. And wehad to havecontacts with Ministry of ForeignAffairs, Immigrationagency, CriminalInvestigationDepartment (Money laundryunit) and ExecutionAuthority (whomakesrestiction of money use and also the limits) • Manyothersanctionlistmatches with bankwereonly with the firstname and lastname. Whenwetoldothernames, date of birth and nationality, theywerenot at anySanctionslist(EU and UN)

24. Developmentmatters • Possibility to change DC (prisoncode) (in useafter 9/2016) • Possibility to usecard in other SEPA country (in useafter 9/2016) • Ibanblock; sothat CSA canpayallowances, but no othertransfer to cards (allready in use) • Wheninmate is released • When the cardholder is on sanctionslist • When the wearenot sure of the cardholder’sidentity • Automaticcardclosurecalenderbased. (allready in use) • For the releasedinmates • Transactionslist for everyinmatethat is at sameprison; by a fewclicksinstead of individuallyprintsseparately (allreaday in use) • Wewouldlike to haveprisonnumber, and runningbalance to eachrow and get the list in alphabeticalorder (notyet in use) • CCP cardholderportal (notyet in use) • Allcardholderscanseetheirbalance and transactions • Released and open prisonprisonerscanalsopayinvoices and transfer money to a differentbankaccount

25. Otherusers of the sameprepaidcardsystem at governmentsector • Immigrationagencystarted at November 2016 • Asylumseekersbenefits • All the benefitsthattheypaywillbepaid via similarsystemby the spring 2018 • Social Insurance Institution(KELA) • Basic incomebenefitpayingmovedfrommunicipalitiesto KELA at the beginning of 2017 and Kela started to use for thoseclientswhichdoesnothaveownbankaccount • Ministry of Justice is planning to start to usefor witness'sfee and theyareplanning to usesingle-usecardswhicharenotreloadable (onlytwopilotcourts, becausethere is no customerservice in swedishyet) • Universitiesmightbeinterested for international lecturers (notyet in use) • National DefenceForces (notyet in use) • For recruittravels

26. Whereprepaidcard is notworking • Veikkaus games (national gamblingcompany), because POS thinksthatthiscard is creditcard. • Fueling a carfrom an automaticgasstation (overusemightbepossible) • If the POS in the shop or restaurant or in the bus is notonline (checking the balance) • Sendingpackagefrom R-kioski (Schenkerdoesnotallowanyotherthandebitcard;) POS thinksthatprepaidcard is creditcard. • Outside SEPA countries, wherefromrelativescannotsend money directly to card and alsodeportedinmatescannotusecard. Most common ”problematic” country is Russia.

27. Problems • Wehadsomeproblemsbecause of NETS doubleauthorisationlastautumn and ittookmorethan a weekuntilall the balanceswereright (itshowednegativebalances and some of the cardholderswere out of money thattime) • Some of the developmentwork at PFS hasinfluencedalsooursystem • Visiblebankaccountnumbers for incoming and outgoingpayments at transactionlist (itwasallreadycorrected and cameback) • Someswedish and frenchtext (allreadycorrected) • Sometimes the systemhasasked us to choosegender • Excel report and different country settings • New users (officers) havenothadall the neededfunctionalities (wecancreateusers, butsometimeswecannotgivesamerightsthanthoseusersthathavebeencreate in England

28. Benefits of prepaidcardsystem 1. • Lessneed for money in cash • Quick to change DC prisoncode in system • Therewasplenty of manualworkearlier • Wehavebeenablereducenumber of officers in handlinginmatesincomes and wehavebeenable to centralizework • Wecanmakedistancesubtitutesbecause of the centralized and sameprogram for inmatemoneyissues • Wecanpayallowances and salaries to inmatesaccordingto the paymentscheduleand process is muchmoreautomatic. • Most of the money coming to inmates is comingdirectlytheircards and muchquickerthanearlier

29. Benefits of prepaid card system 2. • All the open prisoninmatescanhavetheirsalarysameday. • Wecanpayquicker and cheaper inmate’sinvoices. • Releasedinmatescantake the card with themiftheyarereleased to SEPA countries and CSA canpaysalaries to themaccording to paymentschedule. • Saferalso to releasedinmatesnot to havetoomuchcash on theirpockets. • Wedonothave to givecash to inmates for prisonleave.