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It’s about trust, and leadership. Until then, to those of you in Kennesaw, “Georgia’s on my mind.”

According to an article in the Atlanta Journal-Constitution, Chase will be liquidating a customer service center in Kennesaw, Georgia (a suburb of Atlanta), by mid-year, 2010.  The center has been associated with the servicing of co-branded (affinity) Circuit City credit card accounts, and 730 jobs will be cut (although affected employees are eligible to apply for positions elsewhere in the company).

Followers of the ChangeInTerms.com site may think that we would have a big fat grin on our faces upon hearing this news, but we do not.  We are not seeking an end to credit card companies, nor do we hope for the demise of individual employees who work for those companies.  Rather, we are seeking an end to credit card company abuses, and a business model that is based on predatory lending practices.

We do submit that the top executive leadership at most credit card companies is misguided, ineffective, and corrupt.  Since all Americans are now in effect, part owner-investors in these card companies, we also feel that we have every right to criticize Chase’s management team for being extremely myopic. 

I have commented elsewhere about this topic of leadership.  Generating disgust on the part of legions of good-paying account holders who take pride in managing their obligations, is an example of bad faith and bad leadership.  It is truly unfortunate that executives are unwilling to relinquish a business model that relies on rate-jacking, and constantly changing terms as a strategy to extort greater profits.

In any business, customers want reliable service that they understand, and can trust; they want to be treated fairly.  Leadership is about creating an internal and external environment of trust, based on actions, and not merely uttering words.  Chase executives testified before Congress that they treated customers “fairly,” using opt outs as their example to illustrate their point, but now we are missing an “opt out.”  This is a trust issue.  Account holders were heavily solicited to accept a series of “fixed APR Until the balance is paid in full,” offers, but then Chase executives decided to impose a new so-called “service charge,” that in fact “is a finance charge” (thereby violating the fixed APR rate).  This is a trust issue. 

For me, Chase Executive Offices correspondence dated October 10, 2006 that was copied to a Senior Vice President, and a Vice President, assured me that a 3.99 percent fixed APR loan would remain fixed, and long as I did not go over my assigned credit limit or miss a payment, and I have met that obligation, faithfully, and fully.  In multiple rounds of correspondence, including the latest letter I have sent, I still find myself having to point out that the so-called service charge “is a finance charge” (and supposedly, my correspondence with Chase has been escalated to “the highest level”).  Thus, I find it astounding that Chase Executive Offices’ correspondence shows that it is insistent in acting as though the promised 3.99 percent APR will not be affected; Chase knows that under its newly imposed terms, the charges are FINANCE CHARGES.  This is a trust issue.   

Having earned my doctorate at Georgia State University (which is the primary reason for most of my credit obligations beyond obvious exceptions such as a car loan and a mortgage), we spent many good years in Atlanta.  Our two children, both born prematurely, would probably not be here at all, if it were not for the heroic efforts and expertise of doctors and medical staff at Northside Hospital.  Our daughter (born at 30 weeks) was on a collision course with a severe gastrointestinal disorder and would likely have died as a toddler (she gained no weight for a year) if it were not for similarly extraordinary efforts on the part of Scottish Rite hospital (now Children’s Healthcare of Atlanta).  We don’t miss the traffic, but we certainly consider Atlanta to be associated with a difficult, yet cherished part of our overall life experience.

If any of Chase’s operations deserve to be liquidated, it is those that are associated with scheming to profit by writing ever more onerous and unfair change in terms notices.  Chase executives should seek to nurture good accounts, manage “bad accounts” (they should look at things like forbearance, such as those policies that are suggested in my U.S. Department of Education loan: while interest continues to accrue, in the event of a job loss or other severe set of circumstances, payments on those loans can be temporarily suspended until the debtor can recover his or her financial footing).  But no, in the case of the credit card industry, any sign of weakness or temporary difficulty is viewed from a lens that is no different than that of a lion on the Serengeti: prey.  Customers are slammed with fees and usurious interest rates — a quick bite to the jugular. 

Indeed, the credit card industry (and the financial services industry at large) has shown a propensity for creativity.  Unfortunately, due to a lack of ethical or effective leadership, that creativity has been misguided and driven by greed.  That’s why we are all here in this horrible economic quagmire, seeing corporate layoffs as well as suffering on the part of small businesses.  I truly regret that this is where these misguided executives, operating unfettered as they have been in their ability to “use and abuse” customers, have led us and their organizations.

True leaders must have the intellectual-creative capacity as well as the moral compass to consider long-term implications and implement policies and systems that are fundamentally designed to help, rather than hurt.  Leaders must have vision and a propensity to bring about positive change (as a trained researcher, one of my areas of academic concentration and motives for pursuing a graduate education was associated with organizational culture and change, so I find this interesting at many levels).  I see no evidence that this is occurring in the credit card industry, especially at Chase.  Until then, to those of you in Kennesaw, “Georgia’s on my mind.”

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