A senior executive of the GEO Group—the nation’s largest private prison and immigrant detention company—who lobbied the Trump administration for a multimillion-dollar cash infusion has also been staying in the luxurious Trump International Hotel Washington, D.C., billing an unknown sum to his corporate expense account, according to previously unreported records unearthed by the Project On Government Oversight (POGO), a non-profit watchdog.

The admission by David J. Venturella, GEO’s senior vice president of business development, came in a June 2019 deposition in an ongoing federal court case. The executive’s lobbying has drawn the scrutiny of Sen. Elizabeth Warren (D-MA), a frontrunner for the Democratic 2020 presidential ticket. It was aimed at winning federal reimbursement for the company’s hefty legal bills in lawsuits accusing it of human trafficking and forcing immigrant detainees to work with little or no compensation.

Venturella testified that he had charged Trump hotel bills to his GEO credit card on at least 10 occasions. But he has released no further details, leaving unclear how much he spent at the lavish facility only blocks away from the White House and Capitol Hill—the symbolic ground zero for this administration's alleged corruption—and how often Venturella or other company executives stayed in the hotel or other Trump properties on other occasions.

GEO became an avid fan of then-candidate Donald Trump after President Barack Obama’s Justice Department promised to stop approving new federal private prison contracts days after a report determined that private prisons were not necessarily cheaper than government-run ones, causing the company’s stock to plummet 40 percent. What followed was an outpouring of cash from GEO: hundreds of thousands of dollars in contributions to pro-Trump political groups and to his inauguration; and over $4 million in Washington lobbying, much of it directed at the Trump administration. For its part, the administration reversed Obama’s policy and has dramatically boosted GEO’s immigrant detention revenue.

Venturella’s trip to D.C. to lobby Immigration and Customs Enforcement (ICE) in early 2018 was part of a broader influence campaign to block legal challenges to its federal detention business. In private correspondence last year with ICE first reported by The Daily Beast, Venturella, and GEO’s founder and CEO George Zoley, both described the lawsuits the Boca Raton, Florida-based GEO is facing as an urgent threat to the company’s bottom line. But in communications with GEO shareholders and the Securities and Exchange Commission (SEC), they described the litigation risks quite differently.

GEO offered no comment for this story.

“A Series of Misleading Public Statements and Omissions"

GEO’s disparate characterizations caught the attention of Warren, who demanded an investigation into the matter in a previously unreported July 2019 letter to SEC Chairman Jay Clayton. Her missive warned that GEO appears to be engaged in “a series of misleading public statements and omissions of material facts by top executives.” Pointing to multiple potential violations of the federal Securities Act, Warren reminded Clayton that the law “prohibit[s] companies from misleading investors about facts that could affect their business and their stock price.”

In a May 2018 letter to ICE obtained by Northwestern University’s Deportation Research Clinic, Zoley was specific about the financial havoc the lawsuits are causing. He told ICE that defending against those lawsuits, filed in Washington state, California, and Colorado, could cost GEO “$15-$20 million.”

If courts should find the company at fault for the alleged human rights and labor violations, Zoley said that the total bill could amount to tens of millions more. As a result, Zoley told ICE that the company is “deeply alarmed at the rapidly increasing costs in defending these lawsuits without reimbursement from ICE.”

But in contrast to Zoley’s detailed estimates of litigation costs, GEO’s quarterly filing with the SEC in August 2019 says that legal expenses “may be difficult to estimate,” language GEO has dropped in its latest November SEC filing. The company still states it has not set aside any financial reserves to pay litigation costs because “a loss is not considered probable nor reasonably estimable.”

Yet GEO’s latest SEC filing also contends that “an unfavorable resolution of one or more of these claims…could have a material adverse effect on the company’s financial condition.” The filing then goes on to downplay the risks, stating, “the company does not expect the outcome of any pending claims…to have a material adverse effect on its financial condition.”

Warren’s concern is based on the fact that while Venturella and Zoley were making calamitous claims to justify millions of dollars in compensation from ICE, GEO was offering shareholders and the SEC a very different story. “It is difficult to reconcile the dire, private communications of GEO’s top executives about the lawsuits and the failure to disclose any clear financial threat facing the company in SEC filings and on earnings calls,” the senator wrote.

The SEC declined to comment on the senator’s request. Warren's office told POGO they have not heard back from the SEC aside from the agency confirming receipt of the senator’s letter.

While ICE refused to pay GEO’s legal bills, the administration did grant GEO another major request. Both Venturella and Zoley asked the Justice Department to intervene on their side in the lawsuits. And so, in August 2019, the department asked a judge to dismiss the lawsuit against the GEO Group’s Northwest Detention Center in Tacoma, Washington. In late September, U.S. District Judge Robert Bryan wrote that he would toss the case after the Trump administration intervened, but he changed his mind weeks later and is allowing the case to proceed.

“While the Washington court ultimately elected not to dismiss the case at the time, its order importantly declared that” one of GEO’s key defenses “was legally viable, to be ultimately determined at trial,” states GEO’s November SEC filing.

Pattern of Support

Previous news reports have highlighted how GEO—a significant financial backer of Trump’s political campaigns—has patronized the president’s businesses since Trump entered the White House. GEO held its annual conference in 2017 at the Trump National Doral Miami golf resort in Florida. (The administration recently picked the Doral resort to host the G-7 summit, then in short order reversed its decision under pressure from Congress.) In September 2019, roughly a thousand supporters of the president attended an event at Trump’s Doral resort “to discuss a variety of unsupported theories” damaging to the president’s political opponents, according to WNYC and ProPublica. That event was supported by a $25,000 GEO donation.

But Venturella’s spending at the Trump hotel has come up in connection with his and GEO’s explicit lobbying for federal dollars and intervention in the human trafficking lawsuits. In these lawsuits, detainees allege they’ve been forced to work in detention centers under threat of solitary confinement, also called “segregation,” if they refuse. In a February 2018 letter to ICE, Venturella acknowledged that detainees could suffer adverse consequences, including the threat of solitary confinement, for refusing to work, but said the practices are legal and consistent with ICE’s policies. He wrote, “to the extent that plaintiffs allege that disciplinary segregation is an unlawful threat for refusal to work, this sanction comes directly from ICE’s policies, which ICE should assist in defending.”

Recent depositions citing the Trump hotel and other matters emerged in an ongoing lawsuit brought by detainees at the GEO-run facility in Adelanto, California, the agency’s second-largest adult detention center, holding just under 2,000 detainees. The Department of Homeland Security’s top watchdog and independent experts within the department’s civil rights unit have repeatedly criticized the Adelanto’s treatment of detainees, as well as ICE’s oversight. A recent Project on Government Oversight investigation, which has led several senators to introduce legislation this month, showed that Adelanto reported placing detainees in solitary confinement more than any other U.S. immigrant detention center.

Venturella, the GEO executive, has an insider’s view of how ICE runs its immigrant detention complex. Until 2012, he was the a cting head of ICE’s Enforcement and Removal Operations division, the part of the agency that arrests, detains and deports immigrants.

His choice of the Trump International Hotel in D.C. is the first publicized instance of GEO Group’s disbursements at that facility, based in the Old Post Office Building, which the Trump Organization leases from the federal government. The new details of GEO Group’s spending are likely to provide further fuel to critics who contend that Trump’s businesses, from which he has not fully divested, offer an easy way for corporations, foreign governments, and others to curry favor with the president and his administration—essentially a system of “stay to play.”

For instance, a variety of observers have noted that, in a recently released White House memo of a phone call between Trump and Ukraine’s president, the Ukrainian leader made a point to tell Trump he had stayed at Trump Tower in New York City during his last visit to the U.S.

The Trump International Hotel in D.C. also poses unique ethics challenges as the president is effectively both its landlord and the tenant because his company holds the federal lease to operate the hotel and Trump is the head of the federal government. The Trump Organization is trying to sell the hotel, as the Wall Street Journal first reported, and is advertising to potential new owners the ability to “capitalize on government related business,” according to a sales brochure obtained by CNN.

The White House did not respond to a request for comment about GEO’s spending at Trump properties, its political support and lobbying, and about the ethics challenges posed by the president’s business interests.

The Politics of Private Prison Contracting

The GEO Group has a record of making political investments.

In August 2016, one week after an official Justice Department report said private prisons contracted with the Bureau of Prisons are not “necessarily lower cost” than government-run facilities, the Obama administration announced it was phasing out federal use of private prisons. GEO’s stock plummeted nearly 40 percent. The company has vehemently disputed the report’s findings and, days after its publication, a GEO subsidiary gave $100,000 to a pro-Trump super PAC (political action committee) called Rebuilding America. A second donation from GEO’s subsidiary, for $125,000, was sent to the same super PAC days before the November 2016 election. GEO also contributed $170,000 to the Trump Victory PAC in 2016.

After its favored candidate won the White House, GEO donated $250,000 to Trump’s 2017 inauguration committee and financially supported Trump’s post-election transition team before taking office.

The arrival of the new administration would soon pay off for GEO. Weeks after Trump’s January 2017 inauguration, GEO Group hired Ballard Partners—a lobbying firm run by Brian Ballard who was chairman of Trump Victory and was an “integral player in the President’s successful Florida campaign” as well as a vice-chair of the president’s transition team, according to his bio. Ballard’s disclosures show his first lobbying targets for GEO were the White House and the Justice Department. By the end of February 2017, then-Attorney General Jeff Sessions canceled the short-lived policy phasing out private prisons. GEO’s stock shot up in the following months.

All told, GEO has spent more than $4 million on federal lobbying from 2017 through 2019, a sharp increase from prior years.

And the current administration’s immigration policies have meant boom times for the company. In fiscal year 2019, the company received ICE contract revenue exceeding $320 million—about double the maximum it received during the Obama administration in 2015. And the company’s political arm is already supporting the president’s 2020 campaign through donations to the Trump Victory super PAC. Zoley has given $100,000 to the Trump Victory PAC as well, according to Federal Elections Commission records.

While its federal revenue has soared in the last several years, GEO’s stock has fallen off the highs it hit during the early months under Trump. One possible reason involves California, where GEO runs Adelanto and another large ICE detention center, and where the state’s politics have swung markedly against the company.

On October 11, 2019, California enacted a law banning any new contracts for private prisons or immigrant detention centers in the state after January 1, 2020. This could pose a problem for GEO as its Adelanto contract expires in early 2020.

To beat that January cutoff, ICE appears to be shoring up GEO’s financial interests. Five days after California’s governor signed the new law, ICE issued a solicitation for massive new detention contracts in the state. ICE’s goal: to award contracts worth potentially billions over the next decade by late December, just before the new state law goes into effect.

— Aadam Barclay contributed research to this article.