In a comment under my post entitled, “Peggy got in a nicely aimed and delivered “direct hit” regarding the lies that Chase told in their testimony before Congress,” Cathy passed along the following information:
A representative from Chase Executive offices just called me about my email to Gordon Smith. Their position is that the statements made to Congress about Chase having an opt out program for those who do not agree with changes to their terms is outdated. They state that 2 changes have occurred since that testimony and therefore Carter Franke’s assurances do not carry forward to our claims as they were promised on a different type of account and different circumstances.
Of course, I find this twisted logic by Chase very interesting. It does elicit a number of points that merit cross-examination. Let’s start with a review of the testimony, the dates, the time-line, and the context.
In his capacity as Chase’s Chief Marketing Officer, Carter Franke provided testimony before the U.S. Senate Committee on Banking, Housing and Urban Affairs on January 25, 2007. In that testimony, a discussion about “opt outs” was used to illustrate the means by which Chase worked with account holders and treated customers fairly. With respect to context, preceding the remarks about opt outs, Franke stated:
“We appreciate our customers, and we believe our success is based on maintaining a good relationship with every one of them.”
I note that the word-choice “every” does not distinguish differences in account types. Obviously, one of the aforementioned “2 changes” is that Chase has determined that it is not interested in maintaining a “good relationship” with 400,000 account holders who were meeting their obligations. Rather, it has chosen to alienate those customers not only by virtue of changing “fixed APR Until the balance is paid in full” loan terms, it also decided to defame those customers through disseminating a negative portrayal of affected account holders in the media.
Franke also stated:
“Our objective is to establish long-term relationships with students so they will continue to do business with us all their lives.”
I mention this because as I have explained elsewhere, with some obvious exceptions such as my mortgage and a vehicle loan, my personal credit obligations are primarily associated with my decision to go to graduate school, so as to become academically qualified to teach. I wanted to serve and help others.
As I gradually claw my way out of debt as a result of pursuing what I considered to be a long-term and worthy objective (as compared to “shopping” or some other frivolous behavior), I would observe that Chase has failed miserably in meeting its stated objective relative to maintaining a life-long relationship with me, speaking as a former student. As an entrepreneurship professor, now, I am responsible for interweaving a message of ethical behavior in all of my courses (the Chase behavior certainly makes for a great “textbook case study“). Further, you can “bet your sweet bippy!” that I also warn students about the dangers of using credit cards both as consumers, and as a source of capital for small businesses.
Franke also stated:
The importance of customer relationships is a key driver of many of our business decisions. For example, a missed payment on a non-Chase card does not result in an automatic re-pricing of any Chase account.
Obviously, this is another one of the “2 changes” mentioned in Cathy’s comment, above. Clearly, customer relationships are no longer a “key driver” in Chase’s business decisions (if it ever was in the first place, recalling that well before the date of the testimony, a Chase supervisor expressed no interest whatsoever in maintaining a relationship with my wife, after Chase took an adverse action against her “for no reason”). I also have not seen any evidence that Chase isn’t re-pricing cards based on any excuse it can conjure up (and further, according to some posts I have seen on the Internet, it is apparently pulling other “stunts” such as manipulating billing statement due dates so as to “help” people miss a payment).
Now, as for the “opt out” passage, Franke stated:
“We deal with them [customers] fairly and responsibly….we provide that customer with an “opt out” option. This means that the customer may reject any change in terms, close their account, and pay off the balance under their existing terms. We believe the vast majority of our customers feel they are being treated fairly.”
On March 7, 2007, Richard Srednicki (the former CEO of Chase Card Services until he was replaced by Gordon Smith), delivered very similar testimony before the U.S. Senate Permanent Subcommittee on Investigations. About 10 months passed in 2007, and 11 months passed in 2008 before Chase imposed its change in terms to the contrary.
Hence, the life expectancy of Chase executives’ assurances appears to be under two years. Regular readers of the ChangeInTerms.com site will also recall that coincidentally, Chase “desired” to be paid back in about two years (something it never bothered to tell customers when it was promoting its “life of the balance” loans).
In light of the new ”spin” in the Chase Executive Office’s position as noted in Cathy’s comment (also demonstrating that Chase has no moral compass), the statement that “We deal with them fairly and responsibly” reflects yet another change. Accordingly, new testimony, if it was delivered honestly (apparently not among the list of needed leadership competencies to be a Chase executive), would state:
We previously claimed to deal with customers (but we meant only some account types) fairly and responsibly when we sat with a straight-faced and lied before Congress, but a key driver in our business decisions is now short-term profits for our executive perks and bonuses. We also want to raise capital for buying the distressed assets of other banks (like Wa Mu) by accepting bail out money and squeezing customers.
That old “fairness” thing? It’s really been discarded as a useless anchor holding us back at Chase — totally outdated. No more opt outs. We bully the customers and give them no choice in the matter whatsoever. Everyone knows the life of our testimony is about the same as our “life of the balance loans” — until we change our minds and change the terms.
Would you like to know what else has also changed? Carter Franke’s testimony also stated:
This is an extremely competitive industry, and customers have many attractive credit card offers to choose from.
Have you noticed that the industry is for all intents and purposes no longer competitive? Rather, it is run more like a cartel (humm, gas prices in my area: $1.99, $1.99, $1.98; balance transfer fee: 3% no maximum, 3% no maximum, 4% no maximum — new for B of A)?
No, you really don’t have an “opt out” choice with Chase — “fairness” is dead. And, you are really going to be pushed around, trapped like a surrounded victim in a circle of muggers. Lacking any other “attractive credit card offers to choose from,” recently, you can now count on being assaulted by group of lying executives and their lobbyists who control an unfettered credit card industry where the “largest 12 issuers…control more than 88 percent of all outstanding credit card debt in America.”
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on May 2nd, 2009 at 11:56 am
I’m still seething over this conversation and Chases attitude when directly asked to honor a contract option. Out of all of my confrontations with Chase, trying to navigate their dispute process only to be told there isn’t one, and in general come up with a plan to to extract myself from their circular reasoning, I simply come up with more points to ponder.
While I still do not understand how we were “targeted” to begin with, I need to find out what is different between my account and those who got letters saying it was a mistake and you get your 2% minimums back again? Was it the rebel-rousers or the quiet compliant customers, or maybe getting a balance under a certain dollar figure?
Could some of you who received their original terms again please comment on how you were able to convince Chase to reset the original terms… if you are still lurking around the board?
And Doc…Business Week…excellent!
on May 2nd, 2009 at 12:39 pm
Cathy… I am still seething over your conversation with Chase also! I had several exchanges (sometimes heated.. I think the last guy laughed at me) with various individuals which got me nowhere and am holding off a bit before calling them again. (Partly I’m waiting for the OCC to do something on my behalf, but from what I read here, I guess I shouldn’t hold out too much hope for that.)
I just checked out the Chase Corporate Challenge site… and found this interesting…
“If you have general questions about the JPMorgan Chase Corporate Challenge Series, you have two options. First, please be sure to visit our expanded FAQ page, covering all of the frequently asked questions about our Series. If you have additional thoughts or comments after that, please contact us at series-info@jpmorganchasecc.com. We respond promptly to all thoughtful queries.”
I found the word “thoughtful” interesting.. do you think they are getting a lot of hate mail?
on May 2nd, 2009 at 1:09 pm
Here is the link to Dr. Lahm’s interview with Business Week…I’ve skipped right to his page but you can read the rest if you want.
Thank you for defending us!
http://www.businessweek.com/magazine/content/09_19/b4130048127451_page_3.htm
on May 2nd, 2009 at 1:33 pm
Barbara,
Here is what the OCC did for me….forwarded my complaint to Chase and had them call me at home to advise me nothing changed. OCC didn’t even care when I sent them the written follow-up to that conversation, naming and quoting the Chase attorney who laughed and said the OCC can’t make us do anything.
on May 2nd, 2009 at 3:14 pm
Comptroller of the currency, answers to and is appointed by POTUS.
POTUS bought and paid for by the financial lobby = screwed Americans.
You all know that the laws are currently on the books to prevent what has happened to use and the OCC is the fulcrum which is to protect us.
All that needs to happen is for the President to direct the controller to enforce the law.
I’m not holding my breath
on May 2nd, 2009 at 5:27 pm
In 2004 I wrote every attorney’s general of the United States complaining because GM card had raised the monthly minimum payment from 2% to 2.5%.
I believe if we get storeowners to put Daily-Protest.com signs in their storefronts, that eventually the credit card companies would have to acknowledge Robert and myself as leading OUTSIDER advocates who must be made part of the process.
http://www.Daily-Protest.com
on May 2nd, 2009 at 7:21 pm
Alessandro,
Given the rototiller fiasco, are you going to diversify your protest?
Your signs have two sides do they not?
on May 2nd, 2009 at 7:32 pm
Ha ha, Marv you are a mind reader. I am actually putting Daily-Protest.com on the other side of my huge sign, upon which I will wait for the traffic winds to float me above the intersection like a beacon of hope.
————————————
My left pinkie is still numb from using the various rakes and hoes yesterday.
I am still supposed to hoe another part of the yard so we can plant tomatoes.
I used to think tingling or numb fingers were related to my back and my weight, but I’ve actually lost weight from the protesting and taking care of my father before he passed.
I’m not looking forward to my next round in the yard with that stupid roto tiller just standing by and watching me.
http://www.Daily-Protest.com
If I had the time I would make either Daily-Protest postcards or small posters and start asking local businesses to put them in their windows. I may have to take more time off so I can upscale my protest.
Even when I stand by a busy intersection and raise awareness, that still pales than having 10 well placed signs in peoples store front windows.
Maybe I should work a deal with all the places that are available for lease, plenty of them are out there right now.
on May 2nd, 2009 at 8:31 pm
Just went through the rototiller nightmare myself. I am 50 years old and 310 lbs so I am feeling your pain, literally.
Mine is just a little bigger but also the no wheel job.
on May 2nd, 2009 at 9:45 pm
It has wheels in back, it is just such a wimpy design that the instructions for starting it are unrealistic. Lets keep americans busy buying low cost unreliable products that suck immense amounts of productivity from their lives.
http://www.daily-protest.com
on May 2nd, 2009 at 9:47 pm
By the way Robert, excellent title and caption for this article. Chase credit card executives actually apologizing for past policies that had a modicum of decency to them when what they really meant was that customers have not rights.
on May 3rd, 2009 at 9:08 pm
Hi Cathy,
RE #1: “Was it the rebel-rousers or the quiet compliant customers, or maybe getting a balance under a certain dollar figure?”
Since I was one of the cardholders whose account was reset because Chase (supposedly) “incorrectly” sent a change in terms notice, it is certainly logical to wonder if raising a ruckus may have helped.
I don’t think I qualify as being a “quiet compliant”-type any longer (it would have been nice if Chase had simply heeded my warning to Dimon in 2006 — I told him then that they were creating an advocate).
However, I can’t be sure of Chase’s criteria in the first place, and I think it’s going to take the process of legal discovery in the class action lawsuits to find out which account holders Chase actually “aimed at,” and why, as well as which account holders received a retraction, and why.
The whole “making little progress” portrayal in the media was a smokescreen, for instance, with respect to numerous accounts. I’ve written many times about people (me included) paying more than the minimum (and that was irrelevant, anyway, as long as they were meeting their payment obligations — thus it was also a defamatory portrayal).
Keep in mind one other thing about my particular case: I had already established an extensive documentation trail (all of which is posted on the site on the right hand side navigation links under “Correspondence”).
I’ve spoken with a lot of lawyers (I know many of them through academia, and more through the class actions), and when Chase Executive Offices wrote back to me on October 10, 2006, they actually put the 3.99% will remain unless I went over the limit or missed a payment assurances in their letter; the letter was copied to a Senior VP, and a VP. In 2008, the same two persons, the Senior VP and the VP, were copied on the letter that rejected my assertion that Chase had violated its commitment as was stated in the 2006 letter. Then, I reminded them of the paper trail.
Then Chase (foolish to put that in writing as it was) tried to act as though the “fee” was not a “finance charge,” which I followed up with a letter outlining the ridiculousness of such a position, and told them it constituted evidence of obstruction that I did not think anyone would appreciate (hinting at the fact that it could become legal evidence, especially if Chase did not quit playing games with me).
So, was it raising hell on this site, the documentation trail, my message to the OCC that if it wanted to ignore these facts and prove that it was irrelevant and not meeting its obligations, my academic work and testimony about small businesses and credit cards, the fact that at that point in time I was already speaking to the press and organizing resources to mount a resistance (I have seen a few instances where people have contacted Chase’s affinity partners, and people spreading the word with site tools like the eBooks and graphics, but not nearly enough, by the way), or “all of the above”?
Since I don’t know for certain, I’m going to stick with “all of the above,” and even though Chase backed down on my particular account, I will continue to declare the mantra regarding a retraction with respect to all of the accounts Chase “aimed at”:
“If Chase wants peace, it can issue a press release.”
P.S. Regarding the OCC and “laughable”: that’s the exact kind of conversation that needs to be tape recorded, and broadcast. I think that Comptroller Dugan’s attitude is the problem (as I said in my December 3, 2008, letter to Gordon Smith, which was copied to Dugan). All roads lead to the OCC, but it is evidently an absolute dead-end for consumers — that’s the only reason the Chase lawyer would have something to laugh about. This is why I remain convinced that the “weapon of choice” is to de-market the credit card companies (the legal and regulatory game has been rigged for a long, long time).
on May 3rd, 2009 at 11:09 pm
“Since I was one of the cardholders whose account was reset because Chase (supposedly) “incorrectly” sent a change in terms notice, it is certainly logical to wonder if raising a ruckus may have helped.”
Probably correct. I am a “quiet compliant customer,” and Chase didn’t reset the original terms. But we don’t know …
on May 5th, 2009 at 12:18 am
I am not quiet – though I was compliant and I guess I am still compliant since I have been marching to Chase’s tune since the change in terms. However, I raised plenty of ruckus and Chase did not reset my account. So there you have it….
Dr. Lahm, a rabble rouser
gets his account reset.
Anna, the quiet one, does not. Peggy, a loud, complaining one, does not.
It’s a mystery!
on Jun 4th, 2009 at 10:15 am
[...] We don’t know, but I note that whatever Chase executives may do, I am expecting that “fairness will be outdated” (i.e., no opt [...]