The Progressive Change Campaign Committee is pushing a bill just introduced that essentially serves as a reminder to Bank of America customers that they should move their money to a local community bank.
The legislation, from Sen. Dick Durbin (D-IL) and Rep. Brad Miller (D-NC), is a direct reaction to Bank of America’s announcement that they would charge a $60 annual fee for use of their debit card in retail purchases. The annual fee, which could raise as much as $2 billion for BofA, has met with an immediately negative reaction from customers and investors.
Miller and Durbin’s bill would make it easier for bank customers to close their accounts. It would also seamlessly swap direct deposit and electronic bill pay accounts, freeing the customer from having to make multiple separate actions when they change their bank account. It also prohibits any fees or charges for account closure. It takes the hassle out of the process.
PCCC’s email seeks additional co-sponsors for the legislation. But the legislation is mainly a signpost for the idea that Americans still have a choice with their banking. That choice is dwindling as banks consoldiate to an amazing degree. But there still are community banks and credit unions in almost every city, eager for the opportunity to work with customers without trying to gouge them at every turn. And while legislation to make the process of changing banks hassle-free would be very nice, just highlighting the whole idea has value. It adds the notion of competition into a market where banks want none.
While Bank of America’s new fee has been seized upon by opponents of financial reform as a logical consequence of Dodd-Frank’s swipe fee reform, it neglects the fact that banks still make money on swipe fees. They can charge 24 cents per transaction, and it only costs them 7-10 cents to make the electrons move. That’s down from 44 cents, but there’s a right to exorbitant profit being asserted that I don’t recall from my pocket Constitution.
President Obama addressed the BofA debit card fee the other day by saying that it shows the need for the Consumer Financial Protection Agency. In fact, it’s possible that CFPB could enact rules similar to Durbin and Miller’s legislation or even ban the $60 annual fee. Today, the nominee to run that agency, Richard Cordray, gets a confirmation vote in the Senate Banking Committee. He’s expected to clear the committee, albeit without Republican support.
Here’s PCCC’s whole letter on the Miller/Durbin legislation:
David,
Last week, Bank of America announced they will charge a new $60-per-year fee to use debit cards on basic things like groceries. It will pad their profits by an estimated $2 billion.
In reaction, a TV host cut up her Bank of America card on the air.
Now, progressive Congressman Brad Miller — from Bank of America’s home state of North Carolina — is going on offense against Bank of America with legislation that would make it much easier for customers to switch banks.
To gain momentum, Miller needs other members of Congress to pile on this week.
Can you sign our petition urging others to support Brad Miller’s “move your money” bill? Click here.
When the new debit card fee was announced, Sen. Dick Durbin said, “Bank of America customers, vote with your feet, get the heck out of that bank.”
A right-wing blogger wrote, “I actually agree with Durbin to a point.” One person shared, “After 30 years of banking with Bank of America, today I walked into a local branch and asked to speak to the branch manager and closed every account.”
But here’s the catch — Bank of America intentionally puts up obstacles to customers leaving.
In many states, walking into a bank branch isn’t even enough! Miller’s bill would change that — allowing people to close accounts by phone or Internet, and have things like direct deposit transfer automatically.
Urge Congress to hold Bank of America accountable now. Sign here.
Across America, a simmering rage is coming to a boil against Wall Street greed.
The Occupy Wall Street movement has channeled this anger. Today, we’re focusing it into a deep corporate accountability campaign against one of Wall Street’s worst actors.
Rep. Miller’s bill is just the first step. Later, we’ll organize at local branches across the country and target Bank of America with hard-hitting ads.
But first, please sign our petition urging others to support Brad Miller’s “move your money” bill today. Click here.
We’ll deliver this petition to Congress, and work with Rep. Miller to move his legislation forward. Thanks for being a bold progressive.
I’ve been banking with a few CU’s forever, the only reason I keep an account with a larger bank is to access local ATM’s and save myself the withdrawal fee.
Dick Durbin explaining the entire morass on the Senate floor is also worth a watch.
http://www.youtube.com/watch?v=vIgwraNRb-0&feature=player_embedded
A few years ago Bank Of America decided to off-shore their Chicago operations (after getting a tax break from the State). The sTATE Treasurer (Alexi Giannoulias) said “Hey, that’s quite a large pile of Illinois money you have in your vault. It would be a shame if it went to some other bank, wouldn’t it?”
Presto! BofA changed their mind.
Yup. If not for the laws effectively forbidding them from making home loans or operating loans for small businesses, they would have taken over the consumer-lending market ages ago.
O sez he used up a lot of political capital to keep the financial sys afloat.
I’m proud to say that Mrs. Dr. BC and I have banked at a local CU forever, and been well-cared for. But when she moved to Cincinnati and looked for a CU to affiliate with she found nothing.
Do Ohio laws prevent CUs from appearing as banks?
And how’s that investment working out for ya, Big O?
I’m not watching. Gotta make sure to keep my breakfast down. That clip was played on Brain Lehrer show (wnyc) as a response to a Q about what O thought about OWS. Political commentator on show said he thought it made O look at bit out of touch.
Hey, O! How much of that political capital was used to prevent prosecutions of Banksters?
Boxturtle (Probable response: Can’t answer, national security)
People always talk about credit unions in these topics…. well. here is the deal. One of my McJobs after college was at a Credit Union. (i was in lending btw)
We spent a great deal of time trying to figure how to rip people off, milk what we could from customers and lobby to have regulations relaxed.
We did vert similiar things that cause the receny meltdowns. We enticed sun primes into getting loans they could barely if even afford. Every month it was some new promotion to up our housing and car loans. A good trick was “pre-approving” people so they would take on additional debt. One ongoing scam was Lines of Credit. Hey you have this $1500 Line of Credit. Its just there for you.
Once we had maxed out the sub-primes so many couldnt have taken on a %5 loan if they had to our other focus was expanding our “membership” so we could milk some fresh meat.
Little thought was ever given to the “members”.
Anyway, my point is that Credit Unions might make you feel better but they really have the same DNA as the big banks.
I’m not surprised.
But there’s always “becuz they can” factor. IOW, while DNA is the same, the smaller fin institutions cannot get away with as much sh*t as the biggies.
Anecdotes aren’t data, revisionist.
CUs are member-owned and governed by a Board of Directors elected by the membership. If the Board chooses to allow (or more likely, to hire officers from the commercial banking world who hold that ethos) those sorts of shenanigans, they allow it. If the Board chooses not to allow it, they don’t.
It should be no surprise to anyone that there are similarities between CUs and the big banks: they serve the same function, after all. The big question is who benefits? In the case of a big bank, the investors in the bank are the beneficiaries. In a CU, there are no investors.
A good reason to keep close track of your accounts and make borrowing decisions only after exhaustive research of the terms and conditions.
Another option is to keep thousands of dollars stashed in a tube sock and hide it somewhere. Just don’t hide it under the water heater next to the gas flame, not a good idea. Just….sayin’.
yes thats the schtick!
Well…. most of us are living more or less paycheck to paycheck as it is. Really for many people I know the bank is simply a middleman or that tubesock as it were. If you dont have a car or home loan or some interest bearing account, the bank really serves little purpose.
Seems like with todays tech you could be your own bank. My paycheck just gets deposited to my phone and i use that as a debit card. There are so few instance where I need actual cash. All my bills are sent and paid electronically. I havent used a check in a decade and still have the original box they give you when you open an account. So aside from lending, banks should really be going the way of vinyl LPs and landlines.
Here is what you do with money and valuable jewels accordiong to a former burglar turned security consultant. Put money and valuables in a mayonnaise jar in the refrigerator. NOT in the Mrs. Paul’s fisticks box in the freezer. The burglars always look there.
P.S. Make sure it’s NOT a clear glass see-though mayonnaise jar. Actually the large mouth, plastic Miracle Whip jar is best.
I agree. Middle class doesn’t have ENOUGH money to NEED a bank. PLus, mine doesn’t even send me a calendar anymore. 24 month CD’s interest is .00325. Baseball cards….there’s a good investment.