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  • r7ualj r7ualj Apr 22, 1999 10:19 AM Flag

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    04/21/1999
    KRTBN Knight-Ridder Tribune
    Business News: The Miami Herald

    University of
    Florida professor Charles Thomas, who helped guide

    Florida's entry into prison privatization and whose
    national report of
    industry trends analysts say can
    "greatly influence" the stock market, has
    earned a
    reputation the top expert in the field.

    But as his
    reputation has grown, so has his bankbook: The professor,
    a
    $84,000-per-year academic, also was on the
    payroll of a private
    corrections company, commanding
    a $3 million consulting fee for a
    January 1999
    merger involving Corrections Corporation of
    America.

    State records also show he owned an estimated
    $660,000 in stock in
    four private corrections
    companies and is a member of the board of
    directors for
    Prison Realty Corp., a real estate investment trust
    formed to
    provide financing for private corrections
    facilities.

    Complaints to the state Ethics Commission
    followed and last week,
    Thomas admitted to a conflict
    of interest between his work as a university

    researcher and his personal financial stake in the outcome
    of privatization
    efforts.

    In a signed
    document, he offered to halt his university research, pay
    a
    $2,000 fine and resign his position as director
    of UF's Private
    Corrections Project -- a
    research project financed with private donations
    from
    corrections companies -- in order to settle the
    complaints.

    "This is an appropriate settlement," said
    Assistant U.S. Attorney Eric
    Scott, who acted as
    prosecutor for the ethics commission in this
    case.'

    Five of Florida's adult prisons are privately run and
    87 percent of the
    juvenile justice system is run
    by private companies. The state's push
    toward
    privatization, touted as a cheaper alternative to state-run
    facilities,
    began in earnest in 1993, when the Legislature
    created the Correctional
    Privatization
    Commission.

    Mark Hodges, the commission's executive director,
    said the law creating
    the commission was written
    partly by Thomas, who then played a "very
    big" role
    in the first years of the commission.

    "In
    this state and every other state, he's been the one to
    record the
    changes in the private prison industry,"
    Hodges said. "He answered our
    questions, helped us
    understand what was going on the industry. His
    reports
    have been a clearinghouse of information."


    Thomas was employed by the commission as consultant from
    1994-97.
    Hodges said the commission ended his employment
    after the first ethics
    complaint was
    filed.

    The research project also was financed in part by
    donations from private
    corrections companies. Stock
    analysts interviewed by ethics investigators
    said that
    Thomas' industry predictions could "greatly influence"
    the stock
    market.

    Not every private
    corrections company was in Thomas' corner. George
    Zoley,
    chief executive officer of Wackenhut Corrections,
    called the
    professor's close financial relationship
    with CCA and others "most
    disturbing."

 
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