One of my friends has been a mid-level manager at BoA for several years. She was let go last week with severance pay.
Half of her customer service department was outsourced to India causing further unemployment here at home. This is not the first batch of job losses and outsourcing from BoA.
Those CEOs are going to get their money one way or the other...or maybe any way they can.
What better way to "handle" customer service than have someone from a different country deal with your "complaints" if you have one of the credit cards or loans with high interest rates, high fees, and "fine-print rules" that may cause your account to become unmanageable.
In another conversation yesterday with a small business owner who has always managed her business and personal income frugally, she related the following story to me:
After many years she finally agreed to open a credit card for business use to establish credit because she had recently acquired business property and was advised that to establish a credit history she needed to start using cards.
She called in to ask a question about her new card. Within a few days, she received a second card from BoA with a different account number. She decided to use the 1st card for larger business purchases and the 2nd card for smaller business purchases.
She paid off the 2nd card in full each month, but allowed the card used for larger items to carry a balance until she received payments from her clients. She always made at least the minimum payment but usually sent in the entire amount when her clients paid for their orders.
Last week she received her statement and noticed that the interest rate on the first card had been raised to a much higher rate. She called to inquire since she had never been late on a payment, had always sent in the minimum payment (usually more), and never let the card carry a balance over two or three months. She was informed that she no longer qualified for the lower rate. The representative she talked to was very rude and made many unfounded statements regarding her credit.
He asked her why she had never had a credit card prior to several years ago even though she had been eligible for credit since 1984. She explained that she believed in paying as you go and had never wanted to use credit cards because she believes in living within her means. He told her that her credit record must mean that she had filed bankruptcy at some point because there was no other logical explanation for her credit history. She was floored. She has never filed bankruptcy.
He also stated that she must have paid off her 2nd account by transferring a balance since she had paid off a sum of about $4000 at one time. She told him that since she still had a balance of a few dollars on that account there was no way it could possibly be a balance-transfer and leave a small amount on the card. She had not done a balance-transfer but this young fellow was very argumentative.
She asked him if the interest rate on the 2nd card was still at the original low rate or if it had also been increased. He put her on hold to look, then came back to tell her he had closed that account because she was eligible for only one account. She told him that she had not opened this second account...the bank had opened it and sent her the 2nd unsolicited card.
The representative told her that there was no way to lower the interest rate on the 1st card back to the original rate. She had missed no payments and always paid on time. Nothing had changed on her end, yet the interest rate was raised to a much higher level and her FICA score is affected by the bank closing the second account that she did not open by her own accord.
She kept asking to speak to his supervisor but he refused to let her talk to anyone else.
She said that it has been a nightmare dealing with the bank regarding these credit cards. Without the cards, her ability to pay her business loans depends entirely on her customers being able to pay her on time.
The economic crunch is much more dependent on the banks and the credit card industry than anyone is yet acknowledging. If the banks continue to charge loan shark interest rates and treat people in a way reminiscent of the mob loan-shark days our economy is going to continue to grind to a halt.
The CEOs riding this mechanical horse don't realize that it is time for an "oil change". They are not maintaining the economic engine with their self-serving practices.