Private prisons are crashing after a report that the government is ditching them

Inmates sit on the floor during an inspection visit in the long term sentence zone inside Klong Prem high-security prison in Bangkok, Thailand July 12, 2016. REUTERS/Jorge Silva

(Thomson Reuters)

Shares of private-prison providers plunged in trading on Thursday following news that the Department of Justice plans to end the use of such facilities.

Corrections Corporation of America, the largest publicly traded prison provider, fell 50%. Trading of the shares was halted for volatility amid the plunge.

Geo Group, a Florida-based provider of corrections facilities, also tanked by as much as 40% and was halted.

Deputy Attorney General Sally Yates instructed officials in a memo to withdraw or not renew contracts for private-prison operators when they expire. The goal is to scrap their use completely because the Justice Department found them to be less safe than those run by the Federal Bureau of Prisons.

The DOJ contracted with private prisons about a decade ago to cope with the rising prison population. But the numbers are declining for the first time in years.

"Private prisons served an important role during a difficult period, but time has shown that they compare poorly to our own Bureau facilities," Yates said.

Here's the plunge in Corrections Corp of America shares:

Screen Shot 2016 08 18 at 12.45.54 PM

(Investing.com)

And here's Geo Group:

Screen Shot 2016 08 18 at 12.46.32 PM

(Investing.com)

NOW WATCH: The 1980 US Olympic village was turned into a federal prison less than 6 months later

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