I never knew exactly how Martin Shkreli got his cell phones in prison. I didn’t want to know. Contraband is one of those things about prison which operates in two parallel realities. Officially, it is forbidden, a serious offense possibly resulting in more prison time. Unofficially, corrections officers often turn a blind eye to market forces they can’t control. Sometimes they also supplement their modest wages by serving as an invisible hand.
So it is both normalized and a minefield. People might be operating full-on retail stores out of their lockers one minute, and using the proceeds to support themselves, or even families (there were remarkable informal transfer networks which could effectuate these transactions), and suddenly be thrown in solitary confinement over it another. It all depended on the enforcement whims of staff.
Not to mention, friends, family and girlfriends of prisoners could also semi-randomly be harshly punished for providing help with obtaining contraband, whether it was a phone, medication, food, or anything else.
I was well-aware, for instance, of the unfortunate case of Sam Israel, a hedge fund manager sentenced to 20 years in prison for running a $450 million Ponzi scheme, and his girlfriend Debra Ryan. Israel, convicted in 2008, “lied about the performance of the fund, almost from the beginning, overstating gains and understating losses, even saying there were gains where there had been losses,” according to prosecutors (Does that sound familiar?).
Before surrendering to federal prison, Israel attempted to fake his own death — and Ryan helped him. After he was caught and taken to jail, she also mailed him $300 cash by slipping it into a magazine. The money, which was illegal contraband, was meant to help Israel, who suffered from chronic and debilitating back pain, obtain a better mattress, according to Octopus, a somewhat sympathetic book about Israel by author Guy Lawson.
For her efforts, Ryan ended up criminally charged herself and sentenced to four months of house arrest and three years of probation. A judge also sternly forbade her from having any further contact with Israel after the contraband issue came to light, with the obvious implication that she could get sent to real prison for disobeying him. To me, that edict sounded like the worst part of the whole affair for her.
So I tried to avoid learning any information about Martin’s specific mechanisms of contraband acquisition, and made it clear to him that I had no interest in becoming a vector. But we both found the general subject of prison the economy fascinating, and we talked often about it.
He explained the units of exchange to me: Books of stamps were the most common unit of currency; the second most common was packaged mackerel. Like gold, they had…
