Remember when the Ontario government and Bell Canada (TSE: BCE) refused to say how much they earned from inmate calls in Ontario jails between 2013 and 2021?
The telco giant was recently forced to disclose that the number is a whopping $64 million in gross revenues, with nearly $39 million paid to the province as commission. This information comes to light as part of a proposed class-action lawsuit against Bell and the province of Ontario.
The lawsuit alleges that Bell charged “exorbitant” rates for calls made through the Offender Telephone Management System. Inmates were charged $1 per minute plus a $2.50 connection fee for long-distance calls, and the system only allowed for collect calls. These rates were reportedly four times higher than those in other provinces.
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One of the representative plaintiffs in the lawsuit is Ransome Capay, father of Adam Capay, an Indigenous man who spent a significant amount of time in solitary confinement. Ransome Capay reported phone bills ranging from $250 to over $1,000, forcing him to take on extra work to cover the costs.
The Canadian Radio-television and Telecommunications Commission (CRTC) recently ordered Bell to disclose these financial details, despite the company’s attempts to keep them confidential. Lawyer David Sterns described the numbers as “shockingly high” and accused Bell of taking advantage of a captive audience.
Bell maintains that it complied with CRTC rules and offered rates consistent with its other phone services. The lawsuit claims have not been proven in court, and the case is currently on hold pending a CRTC decision on jurisdiction.
The contract between Bell and Ontario stipulated a 60% commission for the province. A new phone system has since been implemented by a different company, offering significantly lower rates and the option for prepaid calls.
Information for this story was found via the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
