Entries Tagged as 'Banks and Credit Unions'

eBay Master Card

GE Money Bank provides the private labeled eBay Master Card and they’ve been running promotions here of late to give you a fairly substantial cash back bonus (generally up to $25.00) on your eBay purchases (applied as a statement credit, instantly).

This might be a good choice if you have an eBay purchase in mind — but there are many better cash back credit cards out there.

For general purpose use the Pentagon Federal Credit Union VISA card is one the the sweetest.

For private label cards, the Chase Amazon.com VISA offers a $30 instant bonus and 6% cash back for the first 90 days; the Chase Buy.com VISA offers a $40 instant bonus; the GE Money Bank Sam’s Club Discover offers a $40 instant bonus; and the GE Money Bank Walmart Discover offers a $10 instant bonus (plus additional $10 bonuses for using the card at places other than Walmat and Sam’s Club).

You can certainly put a little money back in your pocket by playing the credit card game — of course you have to be careful that you understand the rules for getting the cash back (and make sure you follow them).

A couple things to keep in mind.

GE Money Bank is a major credit card issuer — but they are a very low rent credit card company; and you certainly will not be treated like a “valued” customer or even a customer that has a choice.  Both Chase and Citibank are far better large credit card companies to do business with — and Pentagon Federal Credit Union has out of this world customer service and does value your business.

Your credit score can be negatively impacted by applying for a large number of credit cards in a short period of time (regardless of whether or not you are approved, the credit inquiries may lower your FICO score).  To protect yourself, and insure that you get the best credit offers, don’t apply for more than two credit cards in any one month — and try not to apply for more than four in any consecutive three month period.

Originally posted 2010-10-07 02:00:44.

PayPal

The world’s most-loved way to pay and get paid.

What a crock… everyone I know loathes PayPal… the only reason anyone uses it is critical mass; pretty much the same reason people use eBay — that’s like saying people love the phone and cable company just because they use their services.

It’s laughable that a brand that’s synonymous with poor service and screwing people over every time they have a chance would have a slogan like that…

Of course, I broke into hysterical laughter the first time a Pacific Bell customer (dis)service person answered the phone with:

How may I provide you with excellent service today.

My reply was transfer me to a company that actually cares about it’s customers if you can find one.

Remember, it’s the worst companies that find it necessary to try and convince you that they’re loved…

Originally posted 2011-01-20 02:00:53.

It’s not our fault we went bankrupt…

I wasn’t sure it it was a new daytime sitcom or a hearing when former Lehman CEO Dick Fuld delivered his 1680 work prepared testimony.

Lehman was a strong company that had corrected it’s problems:

In retrospect, there is no question we made some poorly timed business decisions and investments, but we addressed those mistakes and got ourselves back to a strong equity position … There is nothing about this profile that would indicate a bankrupt company.

The market and the public were wrong to lose confidence in Lehman:

Lehman’s demise was caused by uncontrollable market forces and the incorrect perception and accompanying rumors that Lehman did not have sufficient capital to support its investments.

The government was at fault for not banning naked short selling or allowing Lehman to convert to a bank holding company or let it take deposits:

Each of those requests was denied at the time. Tellingly, though, each measure was later implemented in some form for other investment banks during the days and weeks following Lehman’s bankruptcy filing.

Lehman was the victim:

This loss of confidence, although unjustified and irrational, became a self-fulfilling prophecy and culminated in a classic run on the bank starting on September 10, 2008, that then led Lehman to file for bankruptcy four days later, in the early morning hours of September 15.

For more comedy (without my satire — and please don’t think I’m serious about anything I’ve written in this post) see the links below; and don’t laugh too hard.

Dick Fuld
Repo 105
Lehman bankruptcy attorney
New York Fed general counsel

Originally posted 2010-09-02 02:00:11.

Occupy Wall Street

Occupy Wall Street
Occupy Wall Street
By Adam Zyglis, The Buffalo News

Originally posted 2011-10-10 02:00:28.

A Pledge of No Privacy

Part of the intent of the Gramm-Leach-Bliley Act (aka the Financial Modernization Act of 1999) and the rules and regulations for federal banking and credit unions was to put into effect requirements on financial institutions1 to safe-guard the personal, confidential, and financial information of their customers2.

On of the main parts of the law was that it required institutions to provide customers with their privacy policy which explained their information sharing and information safeguarding.  However, because the law was heavily effected by lobbying, and even reviewed by large financial institutions before being considered by congress there are cases where institutions aren’t really subject to many limitations on what they can do with your information.

You might find it interesting that every large financial institution I have dealt with since the law was passed (ie Chase, Citi, Bank of America, Barclay, etc) have specifically allowed for an “opt-out” of the sharing for personal information for use both inside and outside the company (effectively limiting the information to be used only as require by law and as necessary for the maintenance of your account).

However, you have to be very careful about smaller institutions.

Credit Unions are in general very customer oriented, and most the time “do the right thing” — particularly when it comes to building a solid, long term customer relationship based on trust and respect.  However, take a look at the “Privacy Pledge” for Gulf Winds Federal Credit Union3 (formerly Monsanto Employees Credit Union) http://www.gogulfwinds.com/page/privacy — WOW — that’s a really nice pledge to no privacy.  In essence what it says is that they’ll use any information they collect on you (both public and non-public) and use it to the full extent allowed by law (I’d guess to profit from) and won’t allow a customer (or consumer) to “opt-out”.

How many ways can you say “non-customer focused”???

The moral of this, don’t assume you’re better off dealing with small “local” financial providers that might seem to have your interests in mind — you might actually end up getting better over all service and respect from a much larger financial provider.

I for one will be re-assessing my financial relationships; and likely terminating a few — and trying to convince congress to stand up to the financial services companies and actually pass a law that protects me.

REFERENCES:

In Brief: The Financial Privacy Requirements of the Gramm-Leach-Bliley Act

NOTES:

1 The Financial Modernization Act of 1999 apply to banks, credit unions, securities firms, and insurance companies as well as a number of other type of companies providing financial services to consumers and is part of a larger framework of federal, state, and local banking laws.

2 The Financial Modernization Act of 1999 privacy requirements apply to customers; which are defined to be consumers (not business) with which the institution has a “long term” relationship (ie holds an account), and does not necessarily cover all consumers who might interact or transact with an institution.

3 You can find the same type of non-privacy policy at a number of smaller financial institutions; Gulf Winds is particularly sad because they refer to it as a “Privacy Pledge” rather than just a “Privacy Policy”.

Originally posted 2010-07-05 02:00:15.

Banks spend big to sell credit cards to students

By Amy Haimerl, personal finance editor CNN
October 26, 2010: 4:27 PM ET

NEW YORK (CNNMoney) — The U.S. Marines recruit college students to become one of the few, one of the proud.

Bank of America just wants their financial future.

The Charlotte, N.C.-based bank spends exponentially more money than any other bank to recruit students for credit cards.

In 2009, Bank of America unit FIA Card Services paid colleges and alumni associations $62 million for the rights to market cards to students and members, according to a report from the Federal Reserve.

The second biggest spender, Chase, dropped $13.8 million to recruit new borrowers, while U.S. Bank forked over $2.5 million.

When the Credit Card Accountability and Responsibility and Disclosure Act — better known as the CARD Act — went into effect in February, it required credit card companies to disclose how much they pay colleges for the right to set up on campuses — plus how many new borrowers it racked up. On Monday, the Federal Reserve made its first report.
College degrees that don’t pay

In total, the report showed that credit card companies spent $82.4 million to net 53,164 new student accounts.

The University of Notre Dame got the biggest payment of any school: Chase paid the school $1.8 million and in the end got 77 new borrowers. The school used the funds exclusively for financial aid, according to university spokesman Dennis Brown.

Meanwhile, Bank of America spent $1.5 million on the University of Southern California campus to sell 659 new accounts.

“If you look at how much is being paid per account, the numbers vary wildly,” says Josh Frank, senior researcher at the Center for Responsible Lending.

In pre-CARD Act year, Frank estimates that 200,000 to 600,000 new accounts were opened on college campuses and through alumni and other organizations.

“But even in a normal year,” he said, “this seems like a lot of money to pay per account. But it’s possible that they just value those accounts more highly and that they’re more profitable for them.”

One major change from the CARD Act is that students under 21 can no longer obtain a credit card without a co-signer — something that could severely limit new accounts. Credit card companies also can’t entice new borrowers through T-shirts and other giveaways — unless they are 1,000 feet (about three football fields) away from the campus.

“Anecdotally, it does seem to be a different environment on college campuses,” Frank said. “Banks are still on campus, but their presence is lower.

Chase paid the University of Notre Dame $1.8 million for the right to market credit cards on the Indiana campus.

Original article on CNN.com

Originally posted 2010-11-08 02:00:40.

Bait and switch rates?

Yesterday (Monday 6-Jul-2010) at 4:15pm I stopped by Gulf Winds Federal Credit Union to open up an IRA Certificate of Deposit; I’d been in the process of transferring money from one institution to another (and it took much longer than it should have — but since two institutions were involved, it’s hard to know which was responsible for the delay).

Anyway, I ended up having to wait 45 minutes to be helped; that gave me plenty of time to look over the posted rate board — and I’d decided that the 2.09% for a 24-month IRA-CD looked reasonable (I’d have preferred 18 months or less, but I wanted a reasonable return rate, and I don’t really expect the economy to start to rebound for several years).

The customer service representative that helped me (the “Financial Services Representative”) ask me which CD I was interested in and I told him — the 24-month 2.09% APR; he immediately said, that the 24-month IRA-CD was 1.97%, not 2.09% — that it had changed on Friday 2-Jul-2010 and they simply hadn’t gotten around to posting it on their rate board.

WTF?

I’ve long been under the impression that financial institutions understand the importance of posting accurate rate information — and I thought most any ethical institution understands the legal (even if they don’t understand the moral) implications of posting fraudulent information.

When I got home I filed complaints with the State of Florida Attorney General’s office (in Tallahassee, FL) and the National Credit Union Administration, Region III office (in Atlanta, GA) requesting that they investigate the business practices of Gulf Winds Federal Credit Union.



Post Note: The VP of Operations contacted me this morning (7-Jul-2010) and Gulf Winds Federal Credit Union will honor the rate as posted yesterday (for me at least).

Originally posted 2010-07-07 02:00:32.

Gulf Winds Federal Credit Union

Much of this post is comprised of excerpts of a letter sent to Chris Rutledge, President/CEO, and Jearil Crawford SVP Operations of Gulf Winds Federal Credit Union, Pensacola, Florida.

Here’s how I opened…

Over the many years I’ve had dealings with financial institutions, it’s generally been my finding that credit unions offer a much better value to a consumer as well as much better service. And further I’ve found that smaller institutions are generally better focused on customer satisfaction.

I can assure you that in the case of Gulf Winds Federal Credit Union the level of service is much worse than many large faceless banks, the focus on customer satisfaction is non-existent, and while the rates your institution pays for deposit account might be good, they in no way make for a better value to a consumer given the nightmarish customer (dis)service which seem to be deeply ingrained in your institutions culture.

What happened?

Well, Gulf Winds offers a higher interest rate (up to the first $15K) in your checking account if you accept electronics statements, make at least one ACH/direct deposit, and do twelve transactions using their (VISA) debit card.

So I stopped on first of July to make one of those twelve transaction, and had my card declined because it was expired.  Sure enough, the expiration date was clearly embossed 06/12 on the card.  But I decided to stop at one more retailer to make sure it gave me the same message and that there was no grace period (though I knew that the magnetic strip would have the same expiration date encoded on it that was embossed on the card)… and sure enough, a second time I got a card expired message from a point of sale terminal.

When I got home, I sent an online message requesting a replacement card.  The reply I got told me the card I had was still good.  WRONG.  I had to send a second message for the exact same issue.  Clearly the customer (dis)service person was in too much of a hurry dismissing customer issues to really care to look into what the issue might be.

Then I was told that I’d have to drive to the corporate branch during business hours; a drive which would be one hundred miles round trip for me; so I ask if it would be possible to transfer to a closer branch (which they indicated yes, but I never actually ask them to do the transfer).

I drove to the corporate branch; stepped in, no one was at the receptionist desk, so I had to wait… finally a young woman told me that the high interest checking account cards weren’t in yet; then she checked again (at my request), and told me my card was at the branch I inquired about having it transferred to; then I ask to speak to someone who actually might have a clue what was going on… and I was ask to wait.

I waited until I’d been at the branch nearly half an hour then left.

One the way back I got a call from a woman there who told me that my card had been at the corporate branch all this time.  And I (not so politely) told her to throw it in the trash, that I would never step foot in a Gulf Winds branch again.

After another half hour I got a call from a man at the branch I normally do business with offering to bring the card to me (he had no idea of the distance), and I told him that Gulf Winds didn’t deserve my business.

I’ve put all this (and more) in a letter (as I said) to Gulf Winds, but to me (since this isn’t the first time I’ve had issues like this with Gulf Winds; nor did the pathetic customer service on this instance only involve one individual)  this is a cultural issue where Gulf Winds people do not take ownership of issues, and only care about going through the motions and moving customers through a (broken) system.

Even though you might be able to get better rates at Gulf Winds than other local institutions, I highly recommend putting your assets in an institution more deserving of your support.

After all, I wasted more than two hours of my life that I will never get back, and will never be compensated for… as far as I’m concerned there’s nothing at Gulf Winds for me.

Originally posted 2012-07-08 02:00:30.

Credit or Debit

When you use your check card bearing a VISA or Master Card logo at a merchant to pay for a transaction you’re given a choice of how the point of sale transaction will be settled — and that’s generally presented to you as “credit” or “debit”.

Should you care which?

HELL YES!

Most merchants would prefer that you choose to settle the point of sale transaction as a debit; and the reason is very simple — money.  Most any merchant will make more from a debit card transaction than a credit transaction (but remember, they’ve built in the credit card charges to their pricing – so you’re not benefiting in the least).  Plus, the funds will be removed from your account almost instantly.  Also, when you choose to do a point of sale transaction as debit, you’ll have to enter your PIN (just like when you use an ATM).  While you might think having to use your PIN is far more secure, in point of fact you’re exposing sensitive information in a public setting — numerous times criminals have compromised merchant networks and obtained both customer debit card account numbers and their PINs.  Keep in mind, even if you can show that your number was used fraudulently, it will take a great deal of effort and time to get your money back — and that might just be the beginning of the nightmare.

But…

When you decide that your transaction will be settled through the VISA or Master Card network (just like a credit card would be) by hitting the “credit” button you will get all the protection that would be afforded to you had you used a credit card.  Federal law protects credit card users; but both VISA and Master Card go beyond the scope of law with their zero liability programs; and if somehow your account is compromised having funds conditionally credited back to you is a simple phone call (and perhaps notarized affidavit) away.  Sure, it might cost the merchant more money for the transaction; but it doesn’t cost you more.  Plus, while the funds to cover the transaction might be placed on hold, they will remain in your account (earning interest perhaps) for several days.  Additionally, if your financial institution has a rewards programs, generally you only earn points in it with credit transactions (that’s because your financial institution makes more money when you choose a credit transaction as well).  Finally, since the transaction settles through the VISA or Master Card network; the fraud prevention systems of VISA or Master Card, in addition to any your financial institution come into play.

Why on Earth would anyone choose to do debit card transaction (using a PIN) when a credit transaction is much, much safer for the individual, and simpler (though you can argue if you have to enter your ZIP code you’ve typed one more digit than your PIN)???

Bottom line — choose wisely; choose credit!

VISA Master Card

NOTE: For debit cards issued by non-US financial institutions; or cards not bearing the VISA or Master Card logos, please contact your issuing financial institution or consult governing laws in your jurisdiction.

Originally posted 2010-07-30 02:00:40.

:( Banks might not have gotten a Get Out Of Jail Free Card afterall :)

It looks like the first major salvo has been fired in potentially forcing the banks to accept liability in the Residential Mortgage Backed Securities (RMBS) fiasco that cause devastating harm to the US economy recently.

The New York Fed, BlackRock, and Pacific Investment Management Company sent letters to Bank of America alleging that its subsidiary, Countrywide, failed to perperly service loans totaling $47 billion.

While the letter itself doesn’t constitute any litigation, it does lay the groundwork for investors filing to recover investments that may have been negligently (mis)handled by banks.

This is a direct result of the “robo-signing” mess that banks have gotten themselves into; since it would be fairly easily established that the banks did not perform due diligence on loans where the documents were not properly reviewed.

I suspect this time it won’t be quite as easy for the banks to pull a rabbit out of the hat by getting the Federal government to provide them with loans — but then again, if you and I don’t make it clear to our elected officials that we’re not interested in another loan to banks, that we expect them to resolve it just like regular Americans have during this economic crisis that banks are largely responsible for.

Originally posted 2010-10-26 02:00:55.