In a recent interview with a German newspaper, Chase CEO Jamie Dimon gave us a glimpse of exactly what is wrong with the banking industry, and Chase in particular. For instance he said that “when profits fall too sharply then capital will move somewhere else, where there is more money to be earned, for example non-regulated markets,” and “the banking industry could do with more influence on politicians.”
Does anyone really believe that the banking industry has been underrepresented in Washington influence in the past?
The problem here is that the ability of banks to take out-sized risks that throw the whole financial system into harms way, to abuse their customers with unreasonable fees and abusive behavior, and to make out-sized profits from all of this, is at risk with recent reform efforts.
Banks have often complained recently that limiting their ability to throw huge bonuses at their staff (and especially their leadership) curtails their ability to retain talent, that people will leave for other companies. But if the entire industry is held to the same standards, where exactly are these financial “geniuses” going to go to earn the same kind of money? There simply aren’t other industries where people can siphon money out of the economy in this way.
This blog seems to think (i.e. states as fact) that Chase loan modifications are simply a tool the bank uses to get more money out of people before they foreclose on them and calls the whole program a scam.
Update 4/21/10: Here is another story that is essentially the same: Chase strings someone along while they make trial modification payments, tells them they are approved, and then denies them and demands a balloon payment of all they are behind, which the customer can’t make, so Chase forecloses.
I am coming across more and more stories about people who have an inappropriate charge of some sort on their credit card so they dispute the charge with Chase, who eventually throws it back at them and says sorry, there is nothing we can do about it. Isn’t that what the dispute process is supposed to be able to help with? In this story, a merchant charges the customer twice for the same thing, but apparently this isn’t enough of an inappropriate charge for Chase to do anything about.
This customer applied for a loan modification and was eventually denied. Chase told them they didn’t qualify under the Federal Governments Making Home Affordable program so they processed them through Chase’s program instead, but they didn’t qualify. The customer subsequently discovered they did infact qualify MHA. Why did Chase not qualify them for this program?
This great article outlines a lawsuit two homeowners have brought against Chase for the advice they were given to stop payments so they could be considered for a loan modification. We all know what happened after that, they were then threatened with foreclosure repeatedly. One point their attorney makes is that there is a huge disconnect between the departments of the bank that handle loan modifications and foreclosures – they just don’t work together.
Apparently a bunch of climate activists, unhappy with Chase’s plentiful funding of mountaintop removal coal mining, held a protest and all closed their accounts, in Seattle on April 15th.
The story goes like this:
1. Woman applies for a loan modification
2. Is approved for a trial mod
3. Is then told she is approved for a permanent modification. The verbal approval confirmation goes on for three months as she religiously calls in multiple times every week to check on status and see if they need additional information. Every time she talks to someone during this period, they confirm, she has been approved for a loan modification.
4. Then one day she calls and is told she has been denied. Not only that, that she must now pay all together on one lump sum everything she has missed for the last 6-7 months. She won’t actually be getting a denial letter in the mail, just a foreclosure notice.
5. Have a nice day.
My question for Chase is, why be dishonest like this? Do they simply not have a clue, or is this some type of malicious game to extract more money before foreclosure? These are peoples lives and homes here, and many of them were duped into the unmanageable loans they have (by WaMu), according to the recent Senate investigations.
This blog posts tells us more of what we’ve heard before, that Chase’s email alerts simply don’t work properly and are inconsistent. So far, we’ve only seen reports from people who got to Chase via WaMu, so it isn’t clear if the same problems exist with accounts that started out at Chase.
Bad bad Chase, Legal & regulatory | admin April 18, 2010 | 
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