The numerous grammatical mistakes (and end of the message) made me wonder if it was from a low level customer service representative.  I have little doubt in my mind that many of these individuals are at the mercy of higher-ups at Chase, and as such must do the “dirty work” of enforcing edicts by senior executives (which is what really “jerks my chain” when I note that Gordon Smith was off lecturing on “leadership” while his employees were implementing one of the most abusive acts against customers in the history of the credit card industry).

I have researched the name of the submitter as was indicated, and I found several links that were suggestive of the individual’s role with Chase (discussed below).  I do not have the ability to determine the authenticity of the submission, but I do have the right to document what has occurred.  Thus, here is what was submitted:

[-------BEGIN SUBMISSION-------]

I am just writing to let your users know why we are treating you this way.

First understand that times are hard and people are having trouble payi,ng us back what they borrowed. This is a real problem.

As a bank we are expected to make a profet for our customers that invest.

Secondly, we really have already loaned more money to Americans than we feel comfortable about.

The economy in America is just not expected to rise any time soon. The employment rate is bottoming out and this affects our buisness. If people don’t have jobs they cannot pay us back.

So the bottom line is we want people to take their buisness elsewhere. Especially those of you that are not using your cards any more.

Please just transfer your accounts to another bank and leave me alone.

Kelly Hanick

[-------END SUBMISSION-------]

First, there does appear to be a “Kelly Hanick” with Chase.  On the ComplaintsBoard.com site under a post entitled “Credit Card Gouging” I found several comments referencing this individual, including some with an email address and telephone number, along with personal (i.e., home) and corporate postal mail addresses.

As an aside, the aforementioned home address was presented with the suggestion that complaints should be sent there, and while I understand the anger, I encourage site visitors to maintain the moral high ground by corresponding to Chase’s offices.  (This is also why I moderate the site.  This is a PG-13 site, for instance, because I will not let Chase have the upper hand by characterizing customers as a bunch of financially illiterate fools who do not have the vocabulary to do anything other than spew expletives; this would aid Chase in justifying the twisted logic that, they — customers — deserve the treatment that has been bestowed upon them.  I maintain this is especially appropriate given that smooth talking executives such as Jamie Dimon seem able to seduce Congressional representatives in Washington, with their “words of wisdom.”)

Kelly also has a profile at LinkedIn.com, a snippet of which is shown in the screenshot below:

Assuming for a moment the veracity of the comment itself, and that it indeed represents the views of the “Kelly Hanick” referenced above, I will provide a response (although I have saved the notification to moderate on the site, including the IP address):

1) Yes, times are challenging.  Unemployment is rising, entrepreneurs are struggling (one of the major reasons unemployment is rising), and Chase is SQUEEZING consumers and small businesses HARD at a time when they are at a tremendous disadvantage.  When payments are jacked-up so high that families and small businesses cannot pay, they default.  Individuals in this predicament were not planning to default; rather, they were PUSHED INTO DEFAULT, by Chase (and other banks).  Banks as a whole have acted in bad faith.  Yes, Kelly, “this is a real problem.”

2) I have never advocated that Chase or any businesses should not make a profit.  The problem is, Chase has attempted to do so by employing unethical tactics.  Where’s my “proof,” you might ask?  Telling me or customers at large that adding a so-called “service charge” that “is a finance charge” would not impact a promotional APR is a lie (I’m not dancing around with other possible word-choices such as “disingenuous,” “incorrect,” or “misleading” — anyone who knows the first thing about interest and amortization knows that adding a finance charge to an existing APR increases the overall rate).

3) Relative to item 2, above, Chase did rescind the finance charge (in a settlement with the New York Attorney General’s Office).  However, it appears to have done so under pressure while admitting no wrongdoing.  (And for me, personally, the damage and repercussions were already done — I’ve addressed that further below).

4) With regard to the “economy” and “unemployment rate bottoming out”: I have been advocating for small businesses as the major contributors to the economy that they are, for years.  On October 12, 2009, I just presented yet another paper based on scholarly research, and I am well aware that approximately half of very small businesses use credit cards as a source of capital (over ten million very small firms).  And, as can be seen in the SBA Office of Advocacy’s most recently published FAQs

Small firms:
• Represent 99.7 percent of all employer firms.
• Employ just over half of all private sector employees.
• Pay 44 percent of total U.S. private payroll.
• Have generated 64 percent of net new jobs over the past 15 years.
• Create more than half of the nonfarm private gross domestic
product (GDP).
• Hire 40 percent of high tech workers (such as scientists, engineers, and computer programmers).
• Are 52 percent home-based and 2 percent franchises.

Hence, while Chase is worried about being paid, its policies are DECIMATING (in yet another way, besides squeezing consumers to the point of defaulting), the very entrepreneurs who are our only hope for an economic recovery, not just “anytime soon,” but ever.

5) Chase has already made it abundantly clear that its wish is to have people take their business elsewhere.  We got that message.  Unfortunately, that’s not so easy to do, for some individuals.  This is especially true after having their credit scores ruined, lines of credit slashed, and in light of a credit card industry cartel which provides few options (in good times or bad).

6) If Chase is so worried about investors and profits, then it might want to keep in mind that engendering a sentiment of fear, disgust, and loathing among customers is not an effective long-term strategy.  Rather, it is a short-sighted, imbecilic tactic, which will become a “textbook case study” in how NOT to treat customers (by the time I’m finished, here).

7) The submission concludes with the remark, “and leave me alone.”  (Kelly) I’m afraid I’ve already made it clear what the conditions are for that to occur.  Banks want customers to read their contracts; meanwhile, READ MY TERMS, CHASE:

• If Chase Wants Peace, it Can Issue a Press Release.
• Apologize for defaming us (after the first round of change in terms notices), and continuing to disrespect account holders with a PR spin campaign which portrays us negatively before members of the media.
• Now, for me to personally “leave Chase alone,” I’ll simply suffice it to say that Chase has damaged me in several ways, including, but not limited to the following:
  • I was forced to suffer penalties and fees by prematurely withdrawing from a retirement account in anticipation of making higher payments;
  • I am among those that Chase defamed (making payments on time, and in many cases paying more than the minimum);
  • Chase did “steal Christmas” last year;
  • because I knew of no other option but to cooperate with members of the media in order to defend my family, my personal finances have now been the subject of coverage in Business Week, the New York Times, the Wall Street Journal, and other outlets (and I do not appreciate being put in such a position by virtue of Chase’s actions and its wherewithal to take advantage of customers, who can do little else to mount a resistance);
  • Chase’s actions exacerbated an already horrible set of circumstances, causing undue stress and emotional hardship for a family that has already been suffering;
  • As we speak, I have just learned that a rock slide on I-40 near the TN/NC border will block off that interstate for months.  I already drive 305 miles each way to and from work every week, because our house has not sold after over two years on the market (the point being, we’ve got enough problems, and we’re not alone: Chase should work with consumers and small businesses, instead of “kicking us while we’re down”);
  • Chase still sends change in terms notices to my wife and household (that is a very, very, very, bad idea) — I already told you to “leave us alone,” in no uncertain terms.

Accordingly, I personally have no plans to leave Chase alone until the damages to small businesses, customers at large, me, and my wife and family have been undone and rectified (to the extent that this is even possible after all of the pain Chase has caused to its previously identified “most valued cardmembers“).

I’ll admit, it is interesting that a SVP of Customer Service* at Chase would possibly submit such a request — to be left alone.  However, I regret to inform you, Kelly, or any other site visitor that “Chase drew first blood.”  There is no way in hell that I’m going to simply go away “elsewhere.”

Chase shouldn’t pick fights at all, but since it chose to start one (by trying to coerce customers via unethical actions), you can all count on this, until MY TERMS and conditions are met:

I’M (STILL) COMING AFTER YOU

AND I’M NOT GOING TO LEAVE CHASE ALONE

* Noting your previous HR background, might I respectfully recommend a career change, Kelly.  “Customer Service” does not really seem to be a supported organizational role at Chase.  I think most interviewers would understand your “reason for leaving.”

© Dr Robert Lahm for ChangeinTerms.com, 2009. | Permalink | 10 comments | Add to del.icio.us
Post tags: advocacy, banks, change in terms, complaints, consumers, credit, customer service, economy, fees, interest, notices, penalties, small business

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Let’s see, if a “similar lot” was $70k “not more than 9 months ago,” but now worth $24,900 (assuming enough similarity to be considered a comparable in a real estate appraisal), then the loss was $45,100 ($5011 per month).

Thank goodness, in these days of economic turmoil (with credit card companies doing all that they can to bully consumers and strangle small businesses), there are “RECESSION PROOF!” safe havens where those who have the financial wherewithal can invest!

Oh well, not to worry, with the “real estate professionals” working the market here in Murfreesboro, TN, it will probably be a while before our present home sells and we can move on to NC, anyway.  Yep, yesterday, one of those “professionals” called from our driveway to show a (local) “looker,” who wanted to see our home.  Forget the one hour notice request on the MLS, “we’re here to see your house!”

It’s days like those that make me want to give up.  But I don’t.  I make the drive.  305 miles, each way, every week, to work (plus the “in-town” mileage, when I am in NC).

I have a deadline to meet this weekend.  I’m working on a conference paper (on credit cards and small businesses).  You see, if I did “give up” on selling our home (by walking out like so many others have done), then I would not have much of an argument any more, when I try to speak out on behalf of struggling entrepreneurs (who are being squeezed — mercilessly — by credit card companies).

I have paid my bills and met my obligations, no matter what.  (As I drive during the treacherous trips through the mountains on I-40 eastbound in eastern Tennessee and western North Carolina, I at least know that if something happens to me, I’ll go with a clean conscience; I’m guessing that an apt description of “hell” is being a credit card account holder for eternity, so I definitely want to avoid going there.)

The FED (which is — unbeknown by most citizens — “owned” by the national banks and not “Federal”) and all of the bailouts have done nothing but enrich executives, who have enjoyed the parties, trips, perks, bonuses, and salaries of corporate big-wigs while they have had the same time, engaged in a reckless campaign against ordinary citizens (worldwide).  Meanwhile, homeowners, small businesses, and middle class consumers at large are slowly having the life sucked out of their wallets.

Just imagine: What if we invested $750 billion in bail out funds on the 21.7* million very small businesses in the United States?

The numbers are so staggering, they’ll make you dizzy (especially if you wear eyeglasses):

$1,000,000,000 (one billion dollars) x 750 = $750,000,000,000

$750,000,000,000 / 21,700,000 (very small businesses) = $34,562.21 (each)

I’d certainly bet that if the first round of bail out funds had been invested in small rather than big businesses, we would have stimulated the economy.  But no, we bailed out big banks and car companies, where a handful of executives (each typically earning in excess of a million dollars in salary, so you do the math) became even richer in bad times, on the backs of all of us.  I know that these executives are about the only ones who can afford scooping up deals on lakefront property right now.  Further, as I have previously written, we could have averted the worst of the mortgage and foreclosure crisis as well.

By the way, regarding one of biggest problems, unemployment (which as you recall, came next in our downward spiral — while we bailed out “big” businesses and executives), and much of the pain that has come from that, could have been avoided if we had invested in small businesses.  Also according to the SBA Office of Advocacy, small businesses: “Employ just over half of all private sector employees”; “pay 44 percent of total U.S. private payroll”; and, “have generated 64 percent of net new jobs over the past 15 years.”

Want to know why we’re suffocating, despite ever-so-slight signs of recovery?  A relatively small number of big businesses and their executives have prospered, and the rest of us, along with our children, and grandchildren, will pay, and pay, and pay.

* Those so small that they have no employees; number taken from SBA Office of Advocacy 2009 FAQs — out of 29.6 million total U.S. businesses.  Yes, the vast majority of all businesses are small businesses.  The vast majority of start-ups “bootstrap,” and many of these use personal and business credit cards as a source of capital.

© Dr Robert Lahm for ChangeinTerms.com, 2009. | Permalink | 5 comments | Add to del.icio.us
Post tags: "Bail Out", advocacy, banks, business credit, consumers, credit, credit cards, economy, small business

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Osama bin Laden: May you be a Chase account holder, at the mercy of its customer service representatives, forever. 

I thank “M” for a comment which included a link to a September 9, 2009 press release entitled, “Consumer Groups Call on Chase Bank to End Minimum Payment Hikes on Fixed Rate Credit Cards.”  Along with additional observations, the release included a copy of a letter that was sent to Chase Card Services CEO Gordon Smith, from the consumer groups (Consumers Union, National Consumer Law Center, USPIRG). 

For those of you who do not know, Consumers Union is the nonprofit publisher of Consumer Reports; the National Consumer Law Center is a leading advocacy organization “protecting vulnerable consumers and promoting marketplace justice”; and  USPIRG is a “federation of state Public Interest Research Groups (PIRGs).” 

Rather than quoting the aforementioned letter in its entirety, I’d like to use this present post to make some observations related to selected passages.  First, considering the source (all of these are premier consumer advocacy organizations), I would submit that the conclusion was certainly a rebuke to Mr. Smith’s leadership decisions while at the helm of Chase Card Services:

“By changing the terms of these promotional financial products Chase is significantly harming the economic stability of the families who make up its consumer base. We ask that Chase reconsider this devastating change in terms.”

The letter included two examples.  One was about a customer who used a promotional balance transfer to pay for his daughter’s college tuition.  And the other example was in connection with a small business owner, who “is having a hard time thinking about how he will pay more than twice as much to Chase each month and still turn over a profit to keep his business going” in light of a new monthly payment of $1200, which had previously been $475 per month.

In case it is not obvious, I have long been aggravated about Chase’s willingness to harm families, students, and small businesses with no apparent sense of restraint or remorse: no “opt out” (despite Chase’s portrayals before Congress in testimony that used opt outs to describe the means by which Chase treated customers fairly*).  The fact that it has pursued this course of action while at the same time defaming responsible account holders in the media is really sick and loathsome as well. 

Since most of my personal indebtedness is associated with my decision to return to graduate school at a significant cost, with what I thought was a worthy motive of becoming academically qualified to teach, trying to help people, I am able to easily empathize with students. 

Now, in my present role as an entrepreneurship professor, I feel duty-bound to speak out regarding the “devastating” consequences that have been imposed on Chase customers who used what was promised to be “fixed APR for the life of the balance” loans in connection with small businesses (many of whom are bootstrapping – sorry they’re not glamorous enough for the Chase corporate culture to appreciate, but these entrepreneurs are the lifeblood of our economy and must be nurtured).  (Do not even get me started, Chase, arguing that customers are voluntarily giving up those fixed rates — the choice is nothing more than another underhanded scheme devised to further enrich Chase executives: Door Number 1, 2, or 3.)

Meanwhile, in light of the above (what Chase has done under the authority of Mr. Smith and his executive team) I’d have to point out (again) that this is not an example of leadership.  The reason for my repetition is that this is a brand new semester, with a brand new Master of Entrepreneurship Degree Program cohort, and a course in New Venture Leadership at the undergraduate level to be taught.  (Thus, I have been thinking about the most important objectives that I have in delivering these courses, in keeping with the notion that I want to contribute to the development of individual students, but also to the cause at large of fostering and enabling entrepreneurship.) 

It’s interesting, first impressions are being formed with these students, and in an opening class session I asked them what leadership “is” (broadly, but also in the context of entrepreneurship).  Obviously, whatever leadership is defined to be in the latest bestselling book — usually a rehash of old concepts using new buzzwords — has long been used as a source from which many would derive their answers.  If you are reading this and waiting for a sound bite or my definition, sorry to disappoint, but I think we’re into a very broad subject (which some have studied their entire lives — and I ask my students to do this). 

I don’t mind framing the subject, however, so let’s start by establishing some dimensionality.  Whatever “floats your boat” with respect to terms that may be used, but I believe that there is “good” leadership as well as “bad” leadership.  To some extent, leaders are associated with their ability to amass followers.  With his charismatic public persona and brilliant use of oratory, Adolf Hitler amassed and subsequently perverted a substantial group of followers who committed unspeakable atrocities and acts of evil.  He almost led the entire world down a path to “unity,” by destroying anyone he did not deem fit to exist such that those who remained would be unified.  Hitler was a “bad” leader.  

(I insert today: Osama bin Laden was/is a “bad” leader.)  I think that the leadership at Chase, is “bad,” too; even if the methods of “bad” leaders differ, the lust for domination and callousness in wreaking “devastation” upon others is apparently the same. 

I think “good” leadership requires individuals who hold high ethical standards.  Frankly, there is a whole scholarly area interested in ethics, but I’d like to keep it simple and give some examples demonstrating ethical breeches on the part of Chase.  For one, back when Chase issued its first infamous change in terms notice, that notice stated: “Important: Your APRs will not be impacted by these changes.” 

I’m sorry, Chase, but adding a so-called service charge that “is a finance charge” (ibid, panel 2) does indeed impact APRs, and stating that it doesn’t is not ethical; frankly, since you are in the banking business and know full-well that such actions raise the APR, I am amazed that Chase would expose itself as being so plainly deceptive in its business practices.  I am even more amazed that Chase correspondence, sent to me from its own Executive Offices would be so absurdly and disingenuously written, in light of basic “financial facts of life” regarding the mathmatical result of adding finance charges on top of finance charges, acting as though this had no impact!

Bullying and coercion are not ethical (it is coercive to raise a payment so radically, “devastating” the household budgets of individuals — including students — and families as well as the operating budgets of small business owners).  Portraying one scenario before Congress (referring to opt outs) only to deny customers an opt out is not ethical (and other than the fact that Chase and the banking industry virtually “owns” Congress and the OCC, I think it’s tantamount to perjury).  Portraying responsible account holders who have met all of their obligations as laggards who were not paying enough, soon enough, before the media is not ethical either. 

Leadership also requires the ability to anticipate the long-term implications of actions that may be taken.  Clearly, attacking a group of “good” customers, alienating them forever, is short-sighted.  With an inkling of positive news in the economy lately, I have recently seen new American Express advertising geared to a small business audience; yet, the imagery of Kevin Johnson and the followers he has on his site, NewCreditRules.com, is what comes to mind first in connection with the AmEx brand.  (Now Kevin is running for office: GO KEVIN!) 

My kid brother contacted me the other day and informed me that Bank of America radically raised his rate to 27% (Bank of America has now taken over my prior mortgage company, and every time I talk with them they want me to speak with a loan officer about originating a new home loan, once I finally sell my present home).  How many times do I have to say it, incompetent bankers?  You’ve messed around with me, my wife (hence, my immediate family), my brother, friends, neighbors, and my colleagues, students, small business owners (therefore the economic well being of all of us), and the result is that

NOW I’M COMING AFTER YOU!  

In short, I think “good” and effective leadership requires at a minimum, an ability to refrain from “harming the economic stability” of not just customers, but of people in general.  Every soul is important.  Harming any person — especially in these difficult times — simply exacerbates an already troubled situation, and that’s what Chase has managed to do (I’ve lost count of the number of people impacted after another wave of change in terms notices — millions) with Gordon Smith at the helm of its Card Services Division.  

I have previously written about the irony of Gordon Smith lecturing at the Thunderbird School of Global Management.  While as he was speaking, minions back at Chase must have been very busy conjuring up and then distributing the first wave of change in terms notices.  The irony was associated with his topic: leadership. 

I certainly hope that in the future, the administration and faculty at Thunderbird would “consider the source” and recognize that their former guest speaker has overseen “devastating” attacks against consumers on the part of Chase Cards Services while he has served as its CEO (duly noted by some premier consumer advocacy organizations), and therefore he does not seem to be an appropriate choice for delivering a lecture on leadership (or marketing, or anything else that I can think of). 

I’m teaching an MBA class in strategy and marketing this semester as well.  I would not be rude to a guest speaker under any circumstances, but then again, I would not invite Mr. Smith to speak in my class (unless he wanted to apologize on behalf of Chase for “harming the economic stability” of every one of us — not just account holders).

The ultimate irony is that causing such harm to others, also harms Chase.  I’m afraid that’s not leadership either, Mr. Smith.  And, I don’t think I’m going to close this post by asking you to “reconsider” (using such a gentle approach, as did the authors of the letter written by consumer groups).  Rather, Chase’s “leadership” can either retract (further details of this demand can be found here – don’t you just love fine print!) its actions, or suffer all of the consequences that will come as a result of destroying its own brand by cultivating an outright rebellion.  Since what I just said is apparently beyond the intellectual or moral capacity of Chase to grasp, I’ll put it in terms that its executive team should be able to understand (as the tyrant and bully that it has been):

If Chase wants peace, it can issue a press release.

I’ll conclude with what I hope is perceived as a respectful remark in connection with the authors of the press release and letter that has been the subject of my discussion here: Chase is not just harming customers ”who make up its consumer base.”  As I have said many times before, when small businesses are harmed, when students are harmed, when individuals and families are harmed, when neighbors, co-workers, brothers and sisters are harmed, then we’re all harmed. 

It does really make me wonder, in light of such a damning letter from these advocacy organizations, would Thunderbird School of Global Management’s faculty sensibilities really support the actions of Chase Card Services? 

* I have previously acknowledged that “fairness” is evidently an outdated concept at Chase, concluding based on its actions that: “Everyone knows the life of our [Chase's] testimony is about the same as our ‘life of the balance loans’ — until we change our minds and change the terms.”

© Dr Robert Lahm for ChangeinTerms.com, 2009. | Permalink | No comment | Add to del.icio.us
Post tags: advocacy, change in terms, consumers, credit, credit cards, customer service, debt, economy, interest, notices, small business, Testimony

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At the time, my wife and I thought that since everything was packed, and our ultimate destination was North Carolina, anyway, then we should go ahead and move it.  (Usually there is little or no moving allowance by the way; it’s Penske trucks — and a massive DIY packing project when we have moved — ever since I began my second career in academia.)

Over the phone (although we had seen the property on a house-hunting trip when we were under the impression that our home sale would close), we leased a 3-bedroom, 2-bath condo.  Our thinking was that we would live there (in the condo), and visit the house in Tennessee until it sold.

We keep an extremely clean and well maintained home (I was without a home, i.e., homeless, at one point in my adult life, so I am very obsessive-compulsive about taking care of what we do have), and our real estate agent expressed confidence in the property’s prospects for selling again soon (during the fall 2008).  The condo manager was kind, and even negotiated an “out” clause in our agreement, in the event that we did sell.

We left just enough things in the Tennessee home to get by: the guest bedroom bed, a scaled down but working kitchen, a few chairs, a small (old-style) TV (we don’t own one of those fancy, newfangled flat-screen TVs), some folding chairs and folding tables, and just a few pieces of furniture in the great room.  The kids’ rooms were emptied completely.  The washer and dryer were moved.  Most clothes, linens, and anything such as personal effects, photographs and memorabilia: they were packed and moved.

After my first week of new employee orientation, we all got in the car and headed back to Tennessee, from the condo in North Carolina.  When we arrived in the early hours of the morning (about 1:00 a.m. on a Saturday, having left on a Friday night), we found our door unlocked.  Yep, a real estate agent had shown the home and failed to lock the door properly.

I could fill up a whole new blog expressing my sentiments and experiences with real estate agents, if I only had the time (noting that blog is short for web log, which originally suggested an online diary).  I’ll skip that for now, because I want to simply point out why we came to the immediate conclusion that someone had to stay in Tennessee, to baby-sit the house.

This was because irresponsible, unprofessional, incompetent realtors (spell-check wants me to capitalize here, but I refuse to do so), don’t give a second thought about sellers’ properties (all they work for is commissions, those so-called buyer’s agents are not in a position to be either “free” or objective when they earn their living by taking their “cut” off the top of every transaction).  They act like your property is their property, to show (calling from a cell phone in your driveway), but they sure as heck don’t bother to extend any respect otherwise.

Since my job was in North Carolina, my wife and kids were the ones to stay with the house for sale.

“Should we bring stuff back?,” we wondered to ourselves.

“No, we’ll wait it out — the house will sell again, soon,” we said; our agent said.

In the meantime, my wife and kids lived as though they were “camping out,” inside of a suburban home.  People have suffered worse; I have suffered worse (as I said, I was once without a home for a period of time).  But, things were not working out as we expected.  I commuted.

My university office was in transition, because the College of Business building was being renovated.  I was advised not to unpack, there.  I had no intention of unpacking most of what had been moved to the condo, either.  Everywhere, most of what we had was either “nothingness” (in Tennessee) or packed and stacked.

As a teacher, I have always enjoyed bringing in exhibits to support what I may have to discuss on any given topic; these resources were packed.  As a researcher, my books and files: packed.  I was not getting “settled in” at work.

As the fall semester was winding up, we were debating where to spend Christmas.  We had signed with a new real estate listing agent (our third), and among the assurances given in the agreement was one that stated that the home would be secured after any showing.  We ended up spending Christmas day in North Carolina, but as can be learned from reading my How Chase Card Service Stole Christmas eBook, that day was destroyed.

The new spring 2009 semester soon began.  My dear cousin was diagnosed with pancreatic cancer; my wife was scheduled for major surgery in February.  Chase had threatened everything I had worked for, for years.  Chase jeopardized my family.  Chase cornered me, although I had done nothing wrong, and evidently, hundreds of thousands of other families and small businesses.

I have been fighting my own personal battles for a long time: to acquire a formal education as an adult learner at the undergraduate level (finally, at the age of 28, I earned that first degree); as an employee in various industries; as an entrepreneur (who has both failed and succeeded); as a husband and father; and in recent years as an academically employed individual.

It’s true.  I have incurred and carried a significant debt load.  However, my debts are primarily associated with my decision to return to graduate school, with the aspiration of becoming qualified to teach; my desire was and is to try to help and serve others.  I had been paying down my debts.  I had been meeting my obligations (I am still doing both, but I am referring to where I stood as I began the spring 2008 semester), and Chase, had decided to attack its most loyal customers.

The spring semester marched on:

My wife had surgery, and recovered (stranded for six weeks with food at arm’s reach on a folding table) in a near-empty house, primarily under the care of children;

Our third real estate agent resigned earlier than the contract specified (she did not have the professionalism to do so in person; she sent emails and subsequently an administrative assistant to have us sign off on the termination — good riddance!);

My dear cousin died;

Chase sent its letter stating that it had “incorrectly” included my account in its infamous “5% minimum payment; ’service charge’ that ‘is a finance charge’,” change in terms;

(But) by then, my personal financial matters became public information, as I felt the only way to fight was to be willing to talk to the media, and use this blog to communicate my disdain for the abusive practices of credit card companies at large against consumers and small businesses;

By May, our house was on the market without a real estate agent (during this period, we observed some of the most unethical treatment of all);

By June, I gave notice at the North Carolina condo — I was moving (almost) everything back to Tennessee.  If we had to look forward to an indefinite period, during which we were still trying to sell, at least my wife and kids could live like normal people in our home;

During the month of June and July, I moved.  A lot of hard physical labor has been involved (my wife has recovered but she is in no condition to be doing “heavy lifting”);

A few weeks ago, in mid-July, the ChangeInTerms.com site went down.  The host suggested that it may have been attacked because a “malicious” hacker file was found in one of the folders;

Concurrently, Chase has mercilessly attacked hundreds of thousands more account holders, hurting consumers, small businesses, and all those who might be considered collateral damage – employees, families;

My emails have piled up;

One of my emails, from someone who knows me and about my advocacy and concern for entrepreneurs, states: “Just as you feared…..Here’s a small, growing business about to be put out of business by Chase’s change in terms.  These folks did what a lot of us did – used Chase credit cards to finance their business”;

My home is now put back together, and habitable (as of several days ago);

Long overdue personal matters have been serviced (tires, dental exams, and the like);

I don’t know where I will be living this coming semester, but I think it will be in hotels (at least I can come home more often, not worrying about our personal things being left in North Carolina);

Here is where I stand, now:

I think I have managed to restore the site, with the exception of the missing posts and comments since June 22, 2009.  I am very disappointed with the hosting situation — that’s a long story.  To make it short, data centers are often attacked, or there can be other naturally occurring issues that arise.  That’s what backups are for, and the reason the site is up again at all is because it was restored from a backup, except for the missing data which for some mysterious reason simply is not in that database – I have looked (at the actual database).

Meanwhile, the company that does the hosting is engaged in a transition, and is moving its customer base to new servers held under a different company name.  I can’t predict the future relative to that transition and the consequences that may arise.

I do not want to complain.  However, it seems that I have no choice but to state a lament: I have said I do not want donations because it sends the wrong message (the long version is elsewhere on the site).  Yet, it remains the case that help is needed in support of this cause in other ways.

I am not a programmer.  I have a career and a lot of responsibilities (and also a very challenging personal situation with a home that has not sold in Tennessee, while at the same time my job is in North Carolina, as detailed above, perhaps ad nauseam).

I have received a number of emails expressing concern that the site was down altogether or not functioning properly.  These tell me that I am not alone in my concern over the issues between credit card companies and their abusive treatment of consumers and small businesses.

That being said, I have felt very much alone in the technology support arena, and it has been up to me to “fix” these problems.

I’ll do the best I can.

No reader should interpret the above to suggest that at some point, frustrated with technology, I would throw in the towel relative to the larger cause.  The site is a tool in the fight, but not the only one.  When you are on a journey and the vehicle breaks down, then you get out and continue on by other means.

You push.  You pull.  You walk.  Or you crawl.

I am on a journey, and I sometimes get to travel fast, and at other times progress is slow.  It can be the case that everything comes to a standstill, or we lose ground and go backwards.  If you are with me, against the abusive treatment of consumers and small businesses by credit card companies, then rest assured that I will continue fighting.

As long as we are right and the leaders of credit card companies are wrong, they will never win the race.  Faith is mightier than fear, and with the former you shall prevail over all obstacles.

© Dr Robert Lahm for ChangeinTerms.com, 2009. | Permalink | 6 comments | Add to del.icio.us
Post tags: advocacy, change in terms, consumers, credit, credit cards, debt, small business

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We were always ready to show with an immaculate and well cared for home, “staged” and with all of the right fragrances, a shine on the appliances, and cleanliness otherwise, inside, under, outside.  We also cut the price: again, and again, and again, and again, trying to be competitive with the market.  Nevertheless, I have been working in North Carolina during the past academic year, and my family has been back in Tennessee.  My wife and I are “separated,” except by virtue of real estate, rather than by marital woes or choice.

The separation and commuting back and forth have been a little taste of hell.  This may also explain — as I have been paying “double” on housing costs during this period of time — why it is that when Chase sent its change in terms notice, it did make me “sick to my stomach” (Brian quoting me, and now me quoting him).

My father was a fighter pilot, and his being called away for military service while I was a child is something I still remember well.  Our situation (that of my wife, children, and myself) has not been that bad, since I’m not being shot at.  But it has certainly been challenging, nonetheless.  I thank those who are serving and protecting us in the military, now.

The aforementioned surgery was timed to coincide with a spring break the following week, and thanks to colleagues at Western Carolina University who have been extremely kind to me, I made some arrangements to fill in for an advising day and one of my classes during the week of the surgery itself.

After spring break was over, I backed out of my driveway in Tennessee, with my wife left essentially in the care of our two children.  I had pulled down everything we could think of from cabinets and closets so that food, towels, blankets, cooking utensils, toilet paper, and other necessities for their survival, camp-out-style, could be reached.  It’s not as though I was the one who had the surgery, but I felt terrible, leaving.

Brian impressed me greatly, not just as a journalist, but as a human being.  We spoke and emailed several times, and he regularly inquired about my wife’s recovery.  The first time we talked, he was immediately warm and conversationally generous — coming across as the kind of person I’d enjoy having as a guest at a back-yard Bar-B-Que (I love cooking, but my wife says I brag too much when I’m in the kitchen; nevertheless, I invited her for dinner for our first date over two decades ago, so you decide!).  Brian is also intellectually vibrant, and I enjoyed our talks.

Brian had nominated me as a candidate for one of the photos to be included in his article, which I now know is entitled, “About That New, ‘Friendly’ Consumer Contract” (April 30, 2009, online; May 11, 2009, print). At the time, I did not understand that the decision would be made elsewhere by editors, so I was scrambling for a tie and accessories, which I did not have with me in Tennessee when Brian was conducting his initial interview.

I tell you all of this to give you context.  I’ve been praised on this site for fighting Chase, and the abuses of credit card companies in general.  However, I’m just a regular person who like many others before me, is working hard to take care of my family, and trying to do right by others (such as students and credit card holders who are either consumers or small business owners).  At the risk of employing an old cliché, I put my pants on one leg at a time, just like anybody else.

I was generally very pleased with the article.  If it’s not clear by this point in my post, Brian Grow was very “decent” towards me and I appreciated the way he treated me during the interview process.  He’s a good guy.

I had hoped for a little less “about me” and a little more about the small business issue.  That being said, if the article directs traffic to the ChangeInTerms.com site, at least visitors may realize that my advocacy is “not so much” about me or any of the personal trials and tribulations that my family and I have faced (we consider ourselves very fortunate, in fact — my wife is much better at this point), but about the issue of abusive treatment of customers by credit card companies.

As can be ascertained from Brian’s article (page 3 of the Internet version), after several sickening months Chase did back down relative to my particular account.  Yet, I have not backed down, and I do not intend to do so, unless and until Chase issues a press release, and admits that it made a mistake relative to all account holders.

Brian was nice, when he stated that “abrupt changes have turned into a public-relations challenge for Chase.”  However, let’s be more direct.  “Chase didn’t admit any wrongdoing” (ibid).  That’s typical, but  the New York Attorney General flatly said that “Truth-in-lending laws prohibit this very conduct.”  Chase apparently even tried to infer that because “there were ‘no negotiations’ with Cuomo’s office,” that it was not engaged in wrongdoing.  I’d like to see this smokescreen cleared by suggesting that the most likely reason that there were no negotiations is because Chase was in violation of Truth-in-Lending-Laws.

I wanted to be a pilot like my dad; indeed, as a boy I dreamed of traveling even farther, in the space program (eyeglasses intervened).  Things don’t always turn out like what you may have imagined, hoped for, or planned.  But here’s what I do know now, credit card companies: with little or no provocation, you have attacked my former colleague, my wife, my former neighbor (an entrepreneur), me (and therefore my whole family), and millions of other undeserving account holders — consumers and small businesses.  Your lack of restraint is unprecedented, especially after taking bail out money and during a volatile time when we are all struggling in a weakened economy.  And we’re now banding together.

My dad used to quip the old pilot’s joke that “any landing you walk away from is a good one” (humor aside, I can understand that point of view; earlier jets were notoriously dangerous).  Well, abusive credit card companies (especially you, Chase): we’re going to “shoot you and your fancy corporate jets down” with anti-marketing missiles, alternative financing sources, lawsuits, and regulation that you royally deserve to receive after what you have perpetrated with such ruthlessness.  These actions against customers, orchestrated by scheming executives, whose only moral code is apparently unbridled greed, will end.

The next time you “kick me when I’m down,” you’d better make sure I’m dead.  I’ve been very “friendly,” thus far, and so have the vast majority of other account holders.  We’ve been paying our bills and meeting our obligations no matter what we have individually and severally been confronting in our own respective lives.  Therefore, abusive credit card companies, you’d better straighten up and fly right.

I recently celebrated another birthday (alone; I’ll be home soon for my cake, dear), and I’m old enough to not want a fight, but still young enough to declare to abusive credit card companies:

NOW I’M (STILL) COMING AFTER YOU

© Dr Robert Lahm for ChangeinTerms.com, 2009. | Permalink | 15 comments | Add to del.icio.us
Post tags: "Bail Out", advocacy, banks, change in terms, consumers, credit, economy, regulation, small business

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Unfortunately, the form does not provide a means for linking, or text effects such as italics, but that’s a very minor point; passing these protections is vital, so please visit the site and submit your own comments, today.  The text below is what I submitted (feel free to copy and paste into the aforementioned form, if you wish):

In recent weeks, several of the major banks and credit card companies raised interest rates and fees yet again. The media reported Capital One hiked interest rates to 17.9 percent from 12.9 percent. Citibank raised their rates an average of 3 percent.

Over at Chase, customers had a “choice” of paying a $120-a-year fee (which was actually a “finance charge” that changed a previously promised promotional rate) and a coercive higher minimum payment (5% of the balance), or paying a higher interest rate.

Worse, given that Chase executives previously testified before Congress about playing “fairly” by providing “opt outs,” guess what was missing?  If you guessed that the “opt out” was no where to be found in Chase’s change in terms notice, then you are correct — there was no “opt out.”  Doesn’t Congress take testimony seriously enough to hold these executives accountable for misleading our elected representatives with what can only be taken as an outright lie by the 400,000 account holders who received Chase’s notice of such onerous new terms (obviously designed to force customers into other choices, such as doubling their interest rates)?

I don’t understand why interest rates for consumers are so high, when the interest rate banks charge each other for overnight loans is as low as 0 percent.

As a responsible credit card consumer, I shouldn’t be subjected to unexpected interest rate increases and fees, which only drive up my costs during these tough economic times. The Federal Reserve Board recently agreed to new credit card reforms which would curb many of these abuses, but those rules will not go into effect until July 2010.  Further, Chase wanted 18 months to comply with these new rules, yet it argued that customers should only need 15 days to comply with its new rules.  Why not protect consumers from these one-sided and completely unfair credit card issuers RIGHT NOW!

The bills being considered would go even further than the rules to help consumers, such as limiting the duration of penalty fees which can sap consumers’ wallets, and curbing aggressive credit card marketing to teenagers without an ability to pay. The bills would:

– Prevent my card company from changing the rules of the game midstream. Companies shouldn’t be allowed to arbitrarily hike the interest rate on my existing balance or new transactions if I make my payments on time just because of an “anytime/any reason” clause in the contract. The deal I signed up for should be the deal I get.

– Require card companies apply my payments fairly across my different balances, not just to the lowest-interest balance. That’s just common sense.

– Control the size and duration of penalty interest rates. Companies shouldn’t be able to keep me at usurious interest rates forever only for one late payment or another minor infraction.

– End abrupt reductions in my credit limit, which negatively affects my credit score through no fault of my own.

–  Provide an adequate amount of time to pay my bill on time by requiring my bill be sent out no later than 21 days from the due date.

– Prevent fees just to pay my bill online or on the phone.

– End aggressive marketing of credit cards to young people who need a chance to establish themselves without a heavy debt burden.

Let’s not forget that small businesses frequently use credit cards.  According to a Federal Reserve Report (2007, showing 2003 data), almost half (46.7%) of small firms used personal credit cards!

ChangeInTerms.com has published a “Credit Cards and Small Business Usage Report,” which provides additional information about the impact of credit card company abuses on entrepreneurs.  Given that an economic recovery will not be possible without a healthy entrepreneurial environment, it is extremely important that you support these needed reforms. 

Indeed, while they are generally long-overdue, under our present circumstances it is vital that you act to stop the next meltdown that the banking industry’s reckless “strong-arm” tactics with consumers and small business owners will actually create, this time over “plastic.”  Don’t let those who have exhibited a clear pattern of failed leadership relative to the banking industry’s numerous misjudgments, unethical behavior, and greed, lead us all down a path of financial destruction in yet another context. 

If these banking industry executives were honest and competent in the first place, we would not all be where we are today, in a crisis that spiraled out of control at a tremendous cost, which will be shouldered for generations.  Please stop listening to their spin, lies and rhetoric, and listen to US (ordinary consumers and entrepreneurs on “main street”) for a change.

© Dr Robert Lahm for ChangeinTerms.com, 2009. | Permalink | 5 comments | Add to del.icio.us
Post tags: advocacy, banks, change in terms, consumers, credit, credit cards, debt, fees, interest, interest rate, small business, Testimony

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We must continue to refute a defamatory portrayal cast upon 400,000 of Chase’s “most Valued Cardmembers“ before members of the media.  The article was entitled, “JPMorgan To Refund Account Fees For 400,000 Credit Cards,” and apparently relied upon Chase’s spokesperson, Stephanie Jacobson, as a source.   Let’s take it from the top, relative to corrections; quoting from the article:

In January, Chase Card Services, a unit of New York-based JPMorgan, notified nearly half a million credit card customers that they would be subject to a $10- a-month service charge for keeping their account open.

Correction: The “$10-a-month service charge” is in fact one that “is a finance charge.”  Why do I correct this over and over, and over, again?  Because it is one of the main points of the entire debacle for account holders.  Since it is a “FINANCE CHARGE,” then Chase violated the previously promised promotional rates; this provided a basis for 12 class action lawsuits (plus 2 more that I have heard about through lead plaintiffs who have contacted me — just waiting on links to the suits). 

I am fairly certain that well before any of the class action lawsuits were filed, I may have been the first person to have made this point about the “FINANCE CHARGE” and the fact that it changed the promotional rate (indicating that Chase made a strategic error) in my letter to Chase Card Services CEO Gordon Smith, which was dated December 3, 2008 (immediately after my receipt of my own change in terms notice).

Relative to “for keeping their account open,” that may be technically correct, but it does not reflect the actual wording in the change in terms document in a manner that conveys the situation with adequate richness: “This charge is owed whether or not you use your account, and you agree to pay it when billed.”

Finally, Chase has continued to engage in what can only be described as an obstructionist campaign based upon an outright lie relative to this so-called “service charge” (a.k.a., “fee”) as described to members of the media.  According to the change in terms notice, Chase falsely stated: “Important: Your APRs will not be impacted by these changes” (Panel 1, Summary Section).  I’m afraid that one probably does not even need to be “smarter than a fifth grader” to grasp that adding a charge that “is a finance charge” does absolutely, positively, and certainly impact APRs; it makes them HIGHER.

Next quote: 

Chase also raised the minimum monthly payments for those customers from 2% to 5% of the account’s outstanding balance.

Correction:  There’s a little more to it than that.  Although any account holder may feel like this is “blackmail,” forcing him or her into switching to Chase’s premeditated option (designed to herd individuals into accepting higher interest rates, typically double the previous rate, e.g., from 3.99%-old to 7.99%-new), as non-lawyers and laypeople, they may not discern some of the finer points of legal language.  Thus, here is a passage from the class action lawsuit, DAVID M. SKAGGS, individually and on behalf of all others similarly situated, Plaintiff, v. CHASE BANK USA, N.A., Defendant, which explains Chase’s act in legal terms (p. 1, lines 16-21):

Chase reneged by placing a $10 per month finance charge on these accounts, and raising the minimum payment due each month.  Chase then uses its unilateral implementation of these onerous terms to coerce cardholders to agree to a higher rate of interest or to pay the loan balances in full.  3. In doing so, Chase consistently misrepresents the facts applicable to these accounts and violates the Truth in Lending Act.

Switching back to plain talk, Chase planned to bully account holders who could not make the higher monthly payments.  Especially in these hard economic times for individuals and families (and small business owners), Chase knew it had a powerful stick with which it could threaten account holders.  It had a lot of people at a tremendous disadvantage and it planned to plunder and pillage, even after accepting $25 billion in bail out money.  (Since this is a PG-rated site, I’ll not add the word that often accompanies “plunder and pillage,” that word being a form of sexual assault.) 

For instance, an account holder with a $20,000 balance (not an atypical debt for a small business owner) would go from paying $400 per month to $1,000 per month; the $600 per month increase may be just about the right amount to support a part-time employee, or pay the rent and utilities for a small business owner’s office.

Next quote: 

Jacobson said the decision to assess account fees at the rate of $120 a year applied to “less than one-half of one percent of our customers.” The credit card accounts in question, she said, carry low promotional interest rates and are tied to “a small percentage of customers that have made little progress in paying down these loans.”

Correction:  I have written about the defamatory nature of these statements made by Chase through its spokesperson(s).  However, “the accounts in question” were most certainly not all associated with individuals who “have made little progress in paying them off.”  Here is a previous post that I created after spending some time researching the Internet to determine if there were in fact other persons, who like me (as I discussed in response to a quote from me in the New York Times), paid more than the minimum — findings indicated numerous others. 

Secondly, the portrayal of these account holders in a negative light, by virtue of suggesting that their “progress” was in some way deficient relative to their loan agreements with Chase, was and is unconscionable, and damaging to the reputation of those account holders.  These account holders, all 400,000 of them (otherwise, they would have already been subjected to usurious 30-something percent rates) were meeting their obligations, have done nothing wrong, were not required to pay more than the minimum — even if that was the case, but many did pay more — and were previously praised as being among Chase’s “most Valued Cardmembers.” 

This inappropriate negative portrayal of good-paying account holders should come at a cost to Chase.  I for one, would like Chase to pay punitive damages and restore the good names of these good-paying account holders, all 400,000 of them, with a letter of apology published on the same newswires which it used to distribute the original misrepresentations and defamatory information. 

Further, a letter of correction should be sent to every credit bureau, for each of the 400,000 account holders (given three major credit bureaus, I estimate approximately 1.2 million letters), specifically noting that these account holders “made the required amount of progress that was indicated in each monthly statement, and therefore faithfully and fully met their obligations.”  Back to street language: “I’ll dare you Chase, insult the honor of these account holders” (since I am a college professor and the father of a teenager, I have the vocabulary to be even more colloquial: “Chase, you better say you’re sorry for dissin’ me and my peeps”).

Given that the “low promotional rates” to which Ms. Jacobson referred would have only been offered to good-paying account holders in the first place (with good to excellent credit — and that takes work on the part of account holders), who have in the interim fulfilled their payment obligations, Chase should be forced to make restitution as described above. 

Because I have now become a public figure, essentially forced into doing so as the only apparent means of protecting my family’s interests in this matter, personally, I would still NOT be satisfied should Chase merely send the aforementioned retractions.  The damage has been done, including tangible losses to my retirement account, from which I took an early distribution (incurring penalties and taxes as well as the loss of future retirement earnings) under the threat of higher monthly minimum payments to Chase.  I’m not the only one who has suffered money damages, which by the way, were associated universally with account holders who were doing all that they could do to protect their good reputations, respectively. 

Several site visitors have asked me privately, “what does this do to the lawsuits?”  While I am not an attorney, I would assert that a “Nevermind!” from Chase does even come close to undoing the damage it has wreaked upon 400,000 account holders.  I know my own sense of psychological as well as financial well being has been egregiously violated, and I would suggest that this is a common condition that has resulted from Chase’s actions.

Next quote:

“Our desire is to have these balances paid back in a reasonable period of time,” Jacobson said. “The minimum payment due will remain the 5% of their new balance.”

Correction: The backhanded implication of the above quote, consistent with the defamatory remarks, is that customers were not already paying their loans back as agreed, “in a reasonable period of time.”  Nevertheless, if Chase had specific ideas or requirements (i.e., “desires”) regarding a loan payoff period, at the very least it should have said so in its promotional messages. It should have provided payment terms in statements that were consistent with these promotional messages as well.  In other words, Chase set the minimum payment amount all along, and it has no right to gripe about account holders who met their obligations by paying the amount that was specified as being due as per their respective monthly statements.

Instead, Chase promoted a false impression of a “fixed APR Until the balance is paid in full” loan as a “Rate Reduction for our [Chase's] most Valued Cardmembers,” and by originally setting payments at 2% of the balance, mislead customers into believing that these payment terms could be expected to continue.  Since it could not easily claim default on the part of individuals who were paying on time and subsequently engage in rate-jacking, Chase decided to try payment-jacking (again, this is also tied to bad faith and coerciveness).

One might note that no time period, whatsoever, was originally disclosed; and, whether from a legal or simply a practical point of view, such disclosure should be recognized as an obvious requirement so that a lender and borrower can communicate in connection with expressing mutual expectations. 

As just about anyone who can drive a car is aware, if one knows the speed at which he or she is traveling, then the time to arrival (ETA) at a destination with a known distance can be calculated.  Translated, this means that Chase knew when it lent money at a given rate of interest, that with payments set at 2% of the balance, accounts would be paid in full in a period of time that was easily calculable.  Thus, for the initial period of the loan, account holders were erroneously led to believe that there was a certain rate of repayment and time associated with these loans.  This illustrates a profound disclosure issue.

Further, noting that Chase has now, finally, indicated that “a reasonable amount of time” would be associated with payments at 5% of the balance per month (like stepping on the gas and accelerating from 40 mph to 100 mph), two questions would arise on the part of any consumer given the language quoted from the promotional offerings: 1) why (in the hell) didn’t Chase define “reasonable” in its original promotional messages?; and 2) if Chase had a specific (“reasonable”) time period in mind, then it is a basic premise of any loan to state as much in advance of providing that loan — hence, why didn’t Chase do so? (For example, car loans may typically be 48 to 60 months, and real estate loans may typically be 15 or 30 years.)

I remain astonished that Chase’s present statements ignore its initial failure to disclose its “desire” in a manner that was forthright.  Further, its failure to disclose its desires essentially necessitates a need for mind-reading on the part of account holders. I also would point out that these are individuals who were previously praised in promotional messages, but who have now for no reason of default have more recently been defamed as essentially, “slow paying laggards who deserved it” from Chase.

Next quote (apparently a portrayal of the author’s now incorrectly skewed viewpoint):

Chase’s decision to assess the monthly fees before retreating only months later illustrates the struggle among credit card lenders to wind down open accounts tied to risky borrowers.

Correction:  “Risky borrowers” exacerbates the damage inflicted by the initial defamatory portrayal (or at the very least, illustrates the result of Chase’s dissemination of misinformation by its spokesperson).  As should be very clear by this point in my discussion, we, the 400,000 who have been defamed, are not the “risky borrowers.”  We were selected for low promotional rates precisely because we were among the least risky borrowers.  We have paid on time and as agreed.  Perhaps the author of this article did not intend to “add insult to injury,” but by accepting what Chase has stated at face value and then providing further (inappropriate) justification to Chase’s misrepresentation, this is exactly what has occurred. 

Therefore, I would like a correction that adds proper clarification from the publication and the author.  I want to be respectful of the author as I can understand how this situation may have occurred.  However, at the same time, I must strongly object to the added insult resulting from the suggestion that we are “risky” or otherwise unworthy borrowers (who from a social justice point of view, somehow “deserved it” relative to what Chase has done).

Next quote:

“Customer satisfaction is important to us,” Jacobson said.

Correction:  ChangeInTerms.com is my primary means for providing customer feedback with regard to the credit card industry as a whole and its abusive treatment toward account holders.   

If the 400,000 number quoted by the media (and in the article’s headline) is accurate from Chase, then there are at least 399,999 individuals, plus me, who are by no means remotely close to being “satisfied” by Chase’s unprecedented act of aggression (which I intend to make into a “textbook study” of how NOT to treat or otherwise “satisfy” customers).  

I can guarantee that even though my wife does not have a Chase account that was associated with this present change in terms, given that ”Chase Card Services Stole Christmas,” and a few years ago a supervisor also flatly told her that Chase did not care whether or not she kept two accounts of her own open, she’s not “satisfied,” either.  For the record, she did nothing wrong (perfect payment record, like me, and these 399,999 additional account holders).  I have mentioned this instance of complete dissatisfaction on the part of my wife in my correspondence with Chase, but I don’t see that it has shown any interest in addressing my her situation.

The class action lawsuits against Chase, in effect, also constitute a form of feedback regarding “satisfaction.”  Indeed, it would be an understatement to say that customers are anything less than outraged.  

An additional form of feedback includes the notoriety of being included in a petition launched by Consumers Union (publisher of Consumer Reports — a premier objective and independent evaluator of what may be good, bad, or in-between relative to product offerings and promotional claims), against this egregious action on the part of Chase.  The intended audience for the petition is the President of the United States.  I’d say that when an organization such as Consumers Union has gone so far as to specify Chase’s actions in a petition all the way to the President, that is a good indication that overwhelmingly, “We can’t get no, sa-tis-faction; though we try, and we try and we try and we try.”

In closing, I would add that the article should also mention Chase’s original representations before Congress in testimony describing “opt outs” as the means by which it treated customers “fairly” (given that this change in terms under discussion is missing any such “opt out” as was portrayed in that testimony). 

The author’s byline contains contact information.  Please help me emphasize the needed corrections as indicated above, along with any other insights you may wish to provide to the author of this inflammatory piece (keep in mind that the author may not have understood that Chase has engaged in an ongoing campaign to spread misinformation, and its executives lied before Congress about opt outs — be polite):

Marshall Eckblad, Dow Jones Newswires; 201-938-4306; marshall.eckblad@dowjones.com

© Dr Robert Lahm for ChangeinTerms.com, 2009. | Permalink | 31 comments | Add to del.icio.us
Post tags: "Bail Out", advocacy, change in terms, Class Action, consumers, credit, credit cards, debt, fees, interest, interest rate, penalties, small business, Testimony

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Got your stimulus money yet?  The banks already have their hands out.

If you’re like millions of other Americans, your credit card company just jacked up your interest rate, or slapped new fees on your card, even though you make your payments on time.

Abusive credit card tactics such as hiking interest rates on your existing card balances were recently stopped by federal regulators, but the new protections don’t go into effect for until July 2010. Our wallets, and our country’s economic future, simply can’t wait that long!

Ask President Obama to make credit card reform an immediate economic recovery priority!

The banks and credit card issuers are standing in the way of our economic recovery. They take billions in taxpayer bailouts, then turn around and slam consumers with higher interest rates, lower credit limits, and exorbitant fees.

Some Chase customers were hit with an interest rate hike or a $120 annual fee and a doubled minimum payment. Capital One hiked rates for millions an average of 5%, and many customers will see an even bigger jump. Citibank, one of the biggest bailout beneficiaries, jacked up rates, too.

We need to stop the interest rate hikes now and require banks give customers the deal they signed up for. Bills in Congress would put the rules in place sooner, but they’re not moving. They might if the President sends a clear message. Tell the President to make this a top priority– it’s an economic rescue that won’t cost taxpayers a cent.

Tell the President we need these reforms now, so we can spend our stimulus on rebuilding the economy!

Let’s make sure the President hears from as many Americans as possible. We know he reads his mail, so please take action, and then forward this on to everyone in your address book so we can make sure the President knows that we need credit card reform as part of our economic recovery.

Sincerely,

Pam Banks
CreditCardReform.org
A project of Consumers Union
1101 17th Street NW, Suite 500
Washington, DC 20036

© Dr Robert Lahm for ChangeinTerms.com, 2009. | Permalink | 3 comments | Add to del.icio.us
Post tags: advocacy, banks, consumers, credit, economy, fees, interest, interest rate

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I appreciate the advocacy of Illinois State Treasurer Giannoulias.  Quoting from the aforementioned article:

On many college campuses it is normal to see a number of credit card vendors competing for students’ business.
 
However, Illinois State Treasurer Alexi Giannoulias is looking to put a stop to this scenario, which he has described as predatory.
 
This week he has been on the University of Illinois campus holding what is called a “counter-marketing” event in which students are asked to sign a petition in support of responsible credit card marketing.

In my particular case, being at mid-career when I started graduate school, I already had established credit, and the maturity to manage credit obligations.  I have tried to utilize long-term supposedly “fixed rate” offers, along with traditional U.S. Department of Education loans (now “consolidated” — these are disbursed incrementally as one progresses through his or her courses). 

Meanwhile, I am certainly for “responsible credit card marketing.”  Unfortunately, the very definition of marketing includes pricing, and as long as one is playing Russian roulette relative to how credit card companies will change terms (i.e., pricing relative to fees and rates), there is no such thing as “responsible” relative to the credit card industry.  I am therefore gratified to see this example of backlash (counter-marketing) taking place at the University of Illinois, or on any college campus. 

For those who are familiar with the core messages associated with the ChangeInTerms.com site, I have long held that while we can’t really change any terms from a legal perspective (initial contracts are written entirely in favor of credit card companies, by virtue of “any time, for any reason, including no reason” change provisions), we can change the terms from a consumer perspective.  In other words, through “counter-marketing” (and I would argue that this is actually more potent and faster-acting than the law), put up a fight!  We can let credit card companies know that we’re no longer willing to tolerate present abuses, and in the long-run, they are making mistakes by alienating a customer base that is going to strike back.

© Dr Robert Lahm for ChangeinTerms.com, 2009. | Permalink | No comment | Add to del.icio.us
Post tags: advocacy, credit, credit cards, debt, fees, interest

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Credit Card Reform article: A statement in your article is factually inaccurate and therefore very misleading; see documentation

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Kathy Chu

USA Today

RE: Credit card reform gets another look

http://www.usatoday.com/money/perfi/credit/2009-02-16-credit-card-reform_N.htm

Dear Ms. Chu,

I am a college entrepreneurship professor. I am also the founder of an advocacy/protest site against abusive treatment by credit card companies. I have been quoted in the New York Times about this issue with Chase, and I have testified before Congress on a related subject, the use of credit cards by small businesses.

You need to know that a statement in your article is factually inaccurate and therefore very misleading:

“Chase (JPM) is tacking on a $120-a-year fee and raising the minimum payment from 2% to 5% of the balance for hundreds of thousands of consumers with low interest rates.”

Journalists have evidently not recognized that the so-called $10 per month Chase “fee” or “service charge,” as stated in the notice, “is a finance charge.” This may sound like simple semantics, but it is a pivotal fact in the numerous lawsuits we are tracking on our site. Chase would like you, as a journalist, to use the word “fee,” because had it not made a mistake in its own fine print by stating that the new service charge “is a finance charge,” then it could possibly have gotten away with this. Because it “is a finance charge,” Chase has violated the terms of a promotional rate that it promoted as “fixed APR Until the balance is paid in full” loans.

As is alleged in the suits, and I have every reason to believe a “reasonable juror” would agree, the document says, “and it is a finance charge” on panel 2, and on first side of the document, it states, “The FINANCE CHARGES section of your Agreement is amended…These charges are finance charges” (please note the all caps print, I have not added any emphasis, the document itself presented the text this way in its original form).

See: http://changeinterms.com/pdfs/Chase-Change-in-Terms_Finance-Charge-5-percent-minimum-payment.pdf

Another part of the article, is very problematic:

“At Chase, some card borrowers were given the choice between the new fee and higher minimum payment, or a higher interest rate of 7.99%. Previously, some borrowers had rates of 3.99%.”

The above is strategy is otherwise known as “bait and switch.” We are now counting 6 class action lawsuits already filed against Chase, plus several more under investigation (and “bait and switch” is in some of the lawsuits, so I am not just saying this off-the-cuff).

Here are other relevant links:

http://www.changeinterms.com/2009/02/18/there-ought-to-be-a-lawan-interview-with-super-lawyer-michael-braun/

http://www.changeinterms.com/2009/02/13/chase-pr-spinmeisters-versus-busy-journalists-10-reasons-to-dig-deeper-and-cover-whats-not-been-said/

http://changeinterms.com/pdfs/CHANGEINTERMS-THE-ISSUE-BACKGROUNDER.pdf

Feel free to contact me if I may serve to inform your research relative to any future articles.

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© Dr Robert Lahm for ChangeinTerms.com, 2009. | Permalink | 2 comments | Add to del.icio.us
Post tags: advocacy, Class Action, consumers, credit, credit cards, interest, interest rate, small business

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