By Jason Ajiake, News Editor
Posted 3:18 PM EST, Thurs., Feb. 2, 2017
After over one year of pressure from the Afrikan Black Coalition, an organization dedicated to improving the conditions of Black students and the Black community at large, the University of California has agreed to discontinue several of its contracts with Wells Fargo, one of the largest financiers of private prisons.
According to the American Civil Liberties Union (ACLU), about 18 percent of federal prisoners are locked up in private correctional facilities, which profit from mass incarceration and subsequently create a dilemma referred to as the prison-industrial complex.
On Nov. 30, 2015, the Afrikan Black Coalition exposed the University of California for investing approximately $25 million into CoreCivic, formerly known as Corrections Corporation of America, as well as two other private prison corporations. Following the announcement, the Afrikan Black Coalition launched a campaign demanding that the university divest from the private prisons and terminate its financial relations with Wells Fargo to avoid any indirect continuation of financial support for the private prison industry.
Less than one month after launching the campaign, which gained massive support at the grassroots level, the Afrikan Black Coalition announced that the University of California had sold all $25 million of its investments in private prison corporations; however, it did not agree to terminate its relations with Wells Fargo.
“Divesting $25 million is a good step toward shutting down private prisons by starving them of capital,” said Yoel Haile, 26, political director of the coalition.
Despite the historic victory, the Afrikan Black Coalition continued to struggle with the university over its relations with Wells Fargo, cleverly referring to the bank as “Jails Fargo” throughout the campaign.
One year later, on Jan. 30, 2017, the Coalition announced that the University of California will discontinue its $150 million interest reset contract with Wells Fargo by April 1 and will curtail $200 million of its $300 million line of credit with Wells Fargo by the end of February. The remaining $100 million will be cut once an alternative bank is found.
Due to the high costs of terminating particular contracts with Wells Fargo, the University will keep $425 million of its investments and recently signed interest rate swap contracts that will expire in 2023, 2045, and 2047.
However, when combined with the termination of a $25 million commercial paper contract with Wells Fargo in Nov. 2016 and the $25 million divestment from private prisons in Dec. 2015, the Afrikan Black Coalition succeeded in pushing the University of California to choose morality over profit, amounting to $500 million in changes.
“This decision is the fruit of dedicated, hard work by the Afrikan Black Coalition, following the orders of our Central Committee,” Haile told The Hilltop. “We hope that it offers a clear possibility of what can happen when we are united, focused, and clear about our objectives and harness the power of our people for goals that advance our people’s political agendas.”
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