Illustration by Victor Juhasz
Some companies are so huge they think they can never fail, no matter what they do. The Bank of America is the fifth-largest company in the United States by total revenue and we now read that they have done something very, very stupid.
I'm not talking about the massive fraud that the bank engages in on a daily basis, such as defrauding schools and hospitals (1), speeding up foreclosures with bogus paperwork (2), laundering Mexican drug money (3), jacking up interest rates on cardholders for no reason other than greed (4), or fraudulently charging excessive overdraft fees (5), I'm talking about the bank's leftist notion of social responsibility:
Bailout recipient Bank of America has severed relations with an American company because of a reported bias against their industry. McMillan Group International released an extraordinary statement on Facebook regarding the incident:McMillan Fiberglass Stocks, McMillan Firearms Manufacturing, McMillan Group International have been collectively banking with Bank of America for 12 years. Today Mr. Ray Fox, Senior Vice President, Market Manager, Business Banking, Global Commercial Banking came to my office. He scheduled the meeting as an “account analysis” meeting in order to evaluate the two lines of credit we have with them. He spent five minutes talking about how McMillan has changed in the last five years and have become more of a firearms manufacturer than a supplier of accessories.
At this point I interrupted him and asked “Can I possible save you some time so that you don’t waste your breath? What you are going to tell me is that because we are in the firearms manufacturing business you no longer what my business.”
“That is correct” he says.
I replied “That is okay, we will move our accounts as soon as possible. We can find a Second Amendment friendly bank that will be glad to have our business. You won’t mind if I tell the NRA, SCI and everyone one I know that BofA is not firearms industry friendly?”
“You have to do what you must” he said.
“So you are telling me this is a politically motivated decision, is that right?”
Mr Fox confirmed that it was. At which point I told him that the meeting was over and there was nothing let for him to say.
The irony of course is that Bank of America may have some political bias against gun manufacturers, but is has no problem with armed security employees guarding its banks. If Bank of America were truly a moral company with principles they would ban any of their employees from carrying guns.
The blowback from this one single, stupid action may be the final straw for the most hated bank in our country: more than 40% of American households own guns. I suggest that you take out your money now, before the bank collapses so badly even Obama can't rescue it.
Washington Post, 7 Dec 2010, Bank of America to pay $137 million in state fraud cases
Bank of America will pay $137.3 million to settle allegations that it defrauded schools, hospitals and dozens of other state and local government organizations, federal officials said Tuesday.
Bank of America is accused of depriving local organizations of millions of dollars by engaging in illegal behavior when investing the proceeds of municipal bond sales
MarketWatch, 5 Oct 2010, The housing market stumbles again
Some of the country’s biggest mortgage lenders apparently have been bending the law to speed up foreclosures.
Investigations are under way at Bank of America Corp. (US:BAC) , J.P. Morgan Chase & Co. (US:JPM) and Ally/GMAC for pushing foreclosures with flawed paperwork. All three have frozen many of their foreclosures pending a review.
The key thing here isn’t that the banks were at times filing faulty foreclosure paperwork that they hadn’t read properly. It’s that they couldn’t possibly have read the paperwork, and nobody at the bank seemed to care. One bank employee said she signed around 8,000 foreclosures a month. If we figure a month consists of 22 workdays of eight hours each, that’s 45 foreclosures an hour. In other words, one minute and twenty seconds per foreclosure, eight hours a day, five days a week. And that’s assuming she took no lunch breaks and wore diapers so she never had to leave her desk. Yet none of her bosses cared.
DailyFinance, 29 Jun 2010, Report: U.S. Banks Laundered Mexican Drug Money
In April, Mexican soldiers searched a DC-9 jet that had landed at the international airport in the port city of Ciudad del Carmen, 500 miles east of Mexico City. On the plane they found 128 black suitcases, packed with 5.7 tons of cocaine, valued at $100 million.
Law-enforcement officials later also discovered something else. The smugglers had bought the DC-9 with laundered funds they transferred through two of America's biggest banks: Wachovia and Bank of America (BAC), Bloomberg Markets reports in its August issue.
Similarly, traffickers used accounts at Bank of America to purchase three planes that ended up smuggling 10 tons of cocaine. "Federal agents caught people who work for Mexican cartels depositing illicit funds in Bank of America accounts in Atlanta, Chicago and Brownsville, Texas, from 2002 to 2009," the article says.
BusinessWeek, 7 Feb 2008, A Credit Card You Want to Toss
Credit-card issuers have drawn fire for jacking up interest rates on cardholders who aren't behind on payments, but whose credit score has fallen for another reason. Now, some consumers complain, Bank of America (BAC) is hiking rates based on no apparent deterioration in their credit scores at all.
The major credit-card lender in mid-January sent letters notifying some responsible cardholders that it would more than double their rates to as high as 28%, without giving an explanation for the increase, according to copies of five letters obtained by BusinessWeek.
Wall Street Journal, 5 Feb 2011, Bank of America Pays $410 Million to Settle Overdraft Suit
Bank of America Corp. agreed to pay $410 million to settle a Florida lawsuit filed against the bank by checking-account customers who alleged they had been charged excessive overdraft fees.