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  • Wednesday, October 05, 2011

    Taking on Wall Street Every Day

    I have personally been switching my money (credit cards, accounts, mortgage) away from the big bad mega-banks that screwed Americans with predatory lending and took taxpayer handouts with better banks and financial institution. And I invite you to join me. It is a way of moving your money at least a step away from the worst of Wall Street.

    In particular I pick four banks to target: Bank of America, Chase, Citigroup and Wells Fargo

    I base my recommendations on three things:

    1. Customer service complaints. The banks that get the most customer service complaints are as follows: (according to the Office of the Comptroller of the Currency, I think these numbers are from 2009)

    Bank of America: 7,230 complaints (25.5% of total)
    J.P. Morgan Chase: 4,890 complaints (17.3%)
    Citigroup: 3,742 complaints (13.2%)
    Wells Fargo: 2,695 complaints (9.5%)
    HSBC North America: 1,963 complaints (6.9%)
    Wachovia: 1,265 complaints (4.5%)
    U.S. Bancorp: 1,027 complaints (3.6%)
    National City: 586 complaints (2.1%)
    The Royal Bank of Scotland Group: 537 complaints (1.9 %)
    Key Corp: 343 complaints (1.2 %)

    Total Top 10 complaints: 24,278 complaints (85.7%)
    Total complaints: 28,316 complaints (100%)

    Furthermore, the numbers of complaints are getting worse. Chase, Bank of America and Citicorp in particular declined seriously in terms of customer service in 2010, according to the Comptroller of the Currency, the American Consumer Satisfaction Index, and Better Business Bureau.

    I advocate avoiding the banks that are around 10% or more of the total complaints (Wells Fargo, Citigroup, Chase and Bank of America). Why patronize companies that treat their customers like crap? Particularly since they have been giving even WORSE service since we bailed them out!

    2. Predatory lending. The same banks that rank highest in customer service complaints are among the worst offenders when it comes to predatory lending. That is strike two against them. Why patronize companies that have bad, greedy business practices that lead to national and international economic crises? And furthermore the predatory lending was carried out by these same banks in a racist manner, charging higher interest rates for blacks and Hispanics than for whites and Asians. And it is the SAME four banks that were the most racist in their predatory lending.

    3. Welfare Banks: The same banks are also ones that eagerly took taxpayer funded bailout money while also advocating for cuts to services for poor and middle class Americans as being "big government". They are selfish and hypocritical as well as lousy businesses.

    Also, I should note that two of these banks, Bank of America and Citigroup, also are two of the top ten tax dodging companies in America. They love to take our tax money, but hate to pay their fair share.

    So I advocate boycotting at least Wells Fargo, Citigroup, Chase and Bank of America. However people need alternatives. I personally have switched to USAA and TD Bank, both of which are famous for customer service, did no predatory lending, and took no bail out money. But I am learning about even better options through Green America.

    Green America (which I have been associated with since they were Co-op America) has some resources:


    * The basics about socially responsible investing

    * How to retire with one million dollars in a just and sustainable world

    * How your savings and checking accounts can build healthy communities through community investing

    I personally have been divesting myself of these big bad banks like Bank of America, Chase, Wells Fargo and Citibank and instead switching my mortgage, accounts and credit cards to USAA (which only works with Veterans and their families) and TD Bank (a large bank that actually has excellent customer service and did not engage in predatory lending). Other people I know have been switching to local credit unions. I have particularly liked TD Bank who refinanced my mortgage at a much better rate and much simpler than the big bad banks. By comparison, Chase dicked me around so much, constantly upping the interest rate every time I talked to them, that I finally told them where they could stuff their refinance. TD Bank offered me a better rate and stuck by it.

    But so far my wife and I still haven't been able to get rid of all our Chase and Bank of America credit cards. Paying off the debt is tough, but we are working on it. But I would like to find better credit cards to use.

    Well, Green America has some suggestions I would like to pass on to you.

    Cards Connected to Better Banks
    There are socially responsible banks and credit unions that exemplify responsible lending practices—as well as community investing institutions that take the social mission one step further by also investing in low-income populations.

    Wainwright Bank Visa Cards (fees and rates vary): Wainwright, a Boston-based bank with a tradition of “socially progressive” banking, offers six different Visa credit cards with different rates and terms. All of these cards are issued and managed by Elan, a financial services company. Steven F. Young, senior vice president at Wainwright, says they “chose Elan because we felt their consumer practices were best.”

    Permaculture Credit Union’s (PCU) Visa card (13% apr, no annual fee): Based in New Mexico, PCU is committed to Earth-friendly and socially responsible loans and investments. PCU’s card is issued by the Illinois Credit Union League to anyone, whether or not they are a PCU account holder, though applicants should mention they are “affiliated” with Permaculture Credit Union.

    ReDirect Visa (15.15% apr, no annual fee): The ReDirect card is issued by Washington state’s ShoreBank Pacific.Depositors fuel the bank’s lending programs, which enable sustainable community development. ShoreBank Pacific issues the card by way of TCM, which is owned by ICBA Bancard, a subsidiary of the Independent Community Bankers of America.

    Your card fees support ShoreBank Pacific’s community investing mission, and half of the card’s proceeds go toward reducing CO2 emissions through Sustainable Travel International’s “MyClimate” high-quality offsets. In addition to a conventional rewards program, the card also earns cardholders discounts at the sustainable businesses listed in regional “ReDirect Guides” for Denver/Boulder/Fort Collins, CO; Portland, OR/Vancouver, WA; and Salt Lake City/Park City, UT. Those businesses that offer Internet purchasing will extend ReDirect discounts to any cardholder. There’s no need to have a ShoreBank Pacific account to apply.

    Salmon Nation Visa (15.15% apr, no annual fee): This card, also from ShoreBank Pacific, directs a percentage of its income to growing a community of citizens that practice environmental stewardship of “Salmon Nation,” a bio-region stretching from Alaska to Oregon where wild salmon live. Like the ReDirect card, Salmon Nation Visa isn’t benefiting a mega-bank, and you don’t need a ShoreBank Pacific account to apply.

    The Loop Card (11.99% apr, no annual fee): A Visa from Albina Community Bank in Oregon. Profits from this Visa from Oregon’s Albina Community Bank not only support Albina, but one percent of every purchase goes to Portland’s neighborhoods, funding education, health, social services, environment, the arts, or economic development projects. You do not have to have an account with Albina to get the card, and it is not connected to a mega-bank.

    Shorebank’s Elan Visa Consumer Card (variable apr, no annual fee): ShoreBank, in the Midwest, is a community development and environmental bank that issues a credit card available to anyone nationwide through Elan, the same company servicing Wainright Bank’s cards, at a rate determined by your credit history.

    Self-Help credit union cards (9.95–12.95% apr, no annual fee): Self-Help, headquartered in North Carolina, works in communities traditionally underserved by conventional financial institutions. It offers Classic and Platinum Visa credit cards to members, and through online banking, anyone nationwide can become an account holder and apply. The cards are issued by Self-Help, a community development bank.

    For those purchases you make by credit card, using one of these best-option cards can make your charges a force for good.


    One of my goals once we can pay off most of our current credit card debt is to switch from my current credit cards, which are still mega-bank linked, to one or two of these cards. I hope you will all join my in making the switch.

    Return to Mole's Consumer Advice Page.

    Return to I Had a Thought

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