Thursday, November 5, 2009

Feeling Good about the Credit Union

So, a while back our bank went under and got taken over by JP Morgan/Chase. I'd originally picked Washington Mutual because I wanted a local bank when I first moved out here, and had been unhappy for a while with its gradual shift into being 'WaMu' (which sounds like a faux-Orca) in attempts to hide its origins. So when it went under, we shifted our main accounts over to the local credit union, where we'd already had some savings accounts for some time.

My reasons included disaffection with Washington Mutual (which shifted its interests more and more into the shaky practices that eventually made it the biggest bank failure in U. S. history) and also a deep aversion to being associated with anything linked to J. P. Morgan, one of the more villainous of the 19th century Robber Barons. And then just yesterday came a story that would have erased any regrets I'd had about the move, if I'd had any:

Basically, this guy deposited some money in his account and then made several debits. Except he didn't know that Chase re-arranged the sequence so that they withdrew the debits first, causing him to have an (artificial) overdraft, allowing them to charge a penalty on each debit, and only then adding in the deposit -- which put him in the red, causing about two dozen more penalties (sometimes up to seven in a single day) by the time he got his next statement.

And this quickly followed up by another story later the same day
about how Chase has agreed to pay the SEC more than seven hundred million dollars as a fine for bribing government officials in Alabama to let them be in charge of issuing what turned out to be some bad bonds. My favorite line in the story? That J. P. Morgan "agreed to refrain from future violations of the securities laws".

So, they not only broke the law, and got caught, and had to pay a fine, but they promise never, ever to get caught doing that again.


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