Tom Steyer, the billionaire hedge fund founder now running for governor of California on a promise to "abolish ICE," is facing pointed questions about the fortune he built, in part through a massive investment in the company that runs ICE detention facilities in the very state he wants to lead.
Steyer's fund, Farallon Capital Management, held shares in CoreCivic, the private prison operator, valued at $89.1 million at one point. CoreCivic today runs five facilities in California, at least two of which house people detained by federal immigration agents: one near San Diego and another in Kern County.
In a recent interview with the Sacramento Bee, Steyer conceded the investment was wrong. But the timeline raises a question his campaign would rather not answer: How does a man who profited from private immigration detention reinvent himself as the candidate who will dismantle the agency that fills those cells?
Steyer founded Farallon Capital Management in 1986. Under his leadership, the hedge fund put money into CoreCivic, then and now one of the largest private prison companies in the country. The New York Post reported that Farallon's CoreCivic stake reached $89.1 million at its peak.
Steyer left Farallon and sold his stake in the hedge fund in 2012. He has since recast himself as a progressive activist and climate crusader, pouring money into Democratic causes. Now he wants California voters to see him as the man tough enough to stand up to federal immigration enforcement.
The problem is the paper trail. CoreCivic's California operations didn't vanish when Steyer cashed out. The company still runs five facilities in the state. At least two hold detainees picked up by federal immigration agents, the very agents Steyer now says should lose their jobs.
Steyer has tried to get ahead of the contradiction. In his Sacramento Bee interview, he offered a carefully worded admission, as the Post reported:
"We never had anything to do with running the company. But it was a mistake to think that that was a place where it was decent to make money."
At a town hall in March, Steyer went further, framing his exit from finance as a moral awakening:
"It was also a big wake-up call that I was in the wrong place, that I was in a business that was taking me to places I absolutely didn't want to go. And there's a reason I walked away from that business and walked away from a ton of money."
He also told reporters that the investments happened roughly two decades ago, adding that he "pledged most of my earnings to charity."
The framing is convenient. Steyer presents himself as a man who saw the light and walked away. But he didn't walk away broke. He walked away a billionaire, one whose fortune was built, in part, on the very system he now denounces on the campaign trail.
Steyer's Democratic competitors have not let the contradiction pass quietly. Tony Thurmond, California's state Superintendent of Public Instruction, went after Steyer directly in a late March interview with an influencer:
"Before he was a progressive, he made millions off of companies that operate ICE detention centers, that operate private prisons that incarcerated young children."
That line of attack, that Steyer's progressivism is a costume draped over a hedge fund career, is the kind of charge that sticks in a Democratic primary, where voters prize ideological purity and distrust Wall Street wealth. And Thurmond is not the only one pressing the point.
The California governor's race has been in turmoil. U.S. Rep. Eric Swalwell's campaign imploded over the weekend, and Steyer is widely seen as one of two leading Democratic candidates expected to absorb most of Swalwell's supporters. A poll conducted April 8 to 10 showed Steyer leading the entire field at 21 percent.
That frontrunner status makes the CoreCivic investment more than an awkward footnote. It becomes the central vulnerability in a campaign built on moral authority. Politico reported that Steyer has already aired ads telling viewers that attack ads about his record are false, a sign his campaign knows the issue has legs.
Steyer's predicament fits a broader pattern in this race. Swalwell's exit came amid serious personal allegations, and the Manhattan DA has since opened an investigation into the congressman's conduct. The Democratic bench in California, supposedly the deepest in the country, keeps producing candidates whose records cannot survive contact with their own rhetoric.
Steyer's case is different in kind, no one is accusing him of a crime, but the structural problem is the same. He is asking voters to trust his convictions while his financial history tells a different story. Calling ICE an agency that should be abolished is a strong position. Calling it that after your hedge fund held nearly $90 million in the company that builds and runs ICE detention centers is something else entirely.
The ongoing federal scrutiny of Swalwell has only intensified the spotlight on every remaining Democrat in the field. Steyer, as the new frontrunner, gets the brightest light.
Steyer's defense rests on the idea that leaving Farallon in 2012 was an act of conscience. He says the CoreCivic experience showed him he was "in the wrong place." He says he gave most of his earnings to charity. He says the investments were "20 years ago."
All of that may be true. But none of it changes the math. CoreCivic's California facilities, including one near San Diego and another in Kern County, are still operating. A photo from March 25, 2026, showed prisoners inside the exercise yard at the California City Immigration Processing Center, described as the state's newest and largest ICE detention facility. The system Steyer helped finance is bigger than ever.
And Steyer's billions didn't come from charity work. They came from decades of hedge fund management that included, by his own admission, investments he now considers morally indefensible. The question for voters is whether a man's regret cancels out his profit, and whether "abolish ICE" means anything coming from someone who helped build the infrastructure ICE uses today.
Some polling experts have warned that Democratic infighting could hand Republicans a historic opportunity in the governor's race. If the party's leading candidate can't survive scrutiny of his own investment portfolio, that warning starts to look less like speculation and more like prophecy.
Steyer told the Sacramento Bee he "never had anything to do with running" CoreCivic. That's the hedge fund manager's classic defense: we held shares, we didn't run the place. But Farallon wasn't a passive index fund. It was an actively managed hedge fund that chose where to put its money. Steyer chose CoreCivic. The returns flowed to Farallon. The profits built the fortune Steyer is now spending on campaign ads.
California voters who care about immigration enforcement, on either side, deserve a candidate whose record matches his platform. Steyer's record doesn't. He made money on private detention, then pivoted to calling for the abolition of the agency that fills those beds. He calls it a wake-up call. His opponents call it hypocrisy. The $89.1 million speaks for itself.
In a state where election integrity and voter confidence are already under debate, the last thing California needs is a governor whose signature issue is built on a foundation he'd rather voters forget.
When a billionaire tells you his fortune was a mistake, believe the fortune.