There’s still a lot to be angry about, still good reason to contemplate transferring your money or at least filing with the new Consumer Financial Protection Bureau if you have a complaint about your mortgage, deposit accounts or credit cards.
This year, as part of the season of leading to Easter, some churches are delivering one of the most powerful Lenten messages ever. According to the progressive website ThinkProgress, “As congregations across the country observe the period between Ash Wednesday and Easter by sacrificing and repenting, religious leaders are asking big banks that have wrongfully foreclosed on homeowners and exacerbated the pain of the housing crisis to do the same.”
On Ash Wednesday, churches in San Francisco announced they were removing $10 million from Wells Fargo and called on the bank, as per the advocacy group Faith in Public Life, “to put an immediate freeze on its foreclosures and repent for its misconduct.” The March 9 New York Times reported that, “The Rev. Richard Smith of St. John the Evangelist, an Episcopal church in San Francisco, likened the divestment campaign and public protests to early Christianity’s ritual of ‘reconciliation of the penitents.’ Far from taking place in the private sanctity of the confessional, that rite occurred in public, with the penitent overseen by a priest and required to present himself before a bishop.
“’It seemed like a parallel to us,’ said Mr. Smith, 62. ‘Our banks have done a great deal of damage in a very public way. So it seems appropriate as we enter into a season of penitence that we invite those who separated themselves from the community to repent with us. It’s basically Ethics 101.’”
The effort is part of several national campaigns to get consumers and community groups to remove their money from the big banks and transfer accounts to credit unions and smaller financial institutions. Travis Waldron at ThinkProgress wrote, “Religious organizations have been at the forefront of movements to get consumers to move their money. The New Bottom Line, a coalition of faith groups, pledged to move $1 billion this year, and before Thanksgiving, churches moved $55 million away from Wall Street banks with pledges to remove as much as $100 million more.”
The March 2 Los Angeles Times noted, “Consumers fed up with the rising tide of bank fees helped the nation’s credit unions more than double their number of new customers last year … More than 1.3 million Americans opened new credit union accounts last year, up from less than 600,000 in 2010, the National Credit Union Administration reported. That brings the number of credit union members to a record 91.8 million.”
There’s still a lot to be angry about, still good reason to contemplate transferring your money or at least filing with the new Consumer Financial Protection Bureau if you have a complaint about your mortgage, deposit accounts or credit cards (consumerfinance.gov). As former Goldman Sachs executive director Greg Smith said in last week’s bombshell Times op-ed announcing his resignation, “It astounds me how little senior management gets a basic truth: If clients don’t trust you they will eventually stop doing business with you. It doesn’t matter how smart you are.”
Jeff Horwitz at the financial daily American Banker last week exposed J.P. Morgan Chase’s credit card services division, reporting that it “took procedural shortcuts and used faulty account records in suing tens of thousands of delinquent credit card borrowers for at least two years,” sparking an investigation by the Office of the Comptroller of the Currency. “The bank’s errors could call into question the legitimacy of billions of dollars in outstanding claims against debtors and of legal judgments Chase has already won, current and former Chase employees say.” As Rolling Stone’s Matt Taibbi observed, “Countless credit card borrowers would now have collection agents chasing them for money they did not owe,” and in some cases, according to a key witness, Chase actually owed the customer money.
Allegedly one of Chase’s more pernicious practices was “robosigning,” the mass production and signing of credit-related affidavits without any semblance of verification, an illegal shortcut similar to the one that plagued the mortgage market and one of the targets of a new report from the inspector general of the Department of Housing and Urban Development.
“Managers at major banks ignored widespread errors in the foreclosure process,” the Times reports, “in some cases instructing employees to adopt make-believe titles and speed documents through the system despite internal objections… the report concludes that managers were aware of the problems and did nothing to correct them. The shortcuts were directed by managers in some cases. …"
Inspector General David Montoya said, “I believe the reports we just released will leave the reader asking one question — how could so many people have participated in this misconduct? The answer -- simple greed.”
Simple greed – hey banks, how about giving that up for Lent?
Michael Winship is senior fellow at the think tank Demos and senior writer of the weekly public television series, “Moyers & Company.”