Former JPMorgan Banker: Exploiting Consumers Is ‘The Purpose Of The Banking Organization’

[marmar]

from ThinkProgress:



Wall Street banks, largely spared from the economic ruin felt by millions of Americans since the financial crisis of 2008, have returned to profitability, generating higher profits in the two-and-a-half years since the crisis than they did in nearly eight years preceding it. But that hasn’t stopped them from seeking new ways to generate revenue — like Bank of America’s proposed $5-a-month debit card fee or the millions banks have made from charging consumers to receive unemployment benefits or food stamps.

If all this makes Americans feel like Wall Street banks only view them as money-making tools, well, that’s because the banks apparently do. According to David Mooney, a former JPMorgan Chase employee, Wall Street banks see consumers as an “income stream” to exploit for profit-making purposes, Reuters reports:

David Mooney, chief executive officer of Alliant Credit Union in Chicago, one of the nation’s larger credit unions, used to work at a one of Wall Street’s top banks, JPMorgan Chase. There’s a vast cultural gap between Wall Street and his new world, he says: Old friends from the Street, he says, now jokingly refer to him as a “socialist.” A credit union is supposed to be run in the interests of all members, he says, while commercial bankers tend to see consumers as customers who can be “exploited” by layering on more fees.

Says Mooney: “I don’t say this lightly, but the consumer is simply an income stream and exploiting that is the purpose of the banking organization.”

Mooney’s bluntness may seem shocking, but his assessment shouldn’t. Wall Street banks made millions profiting off shoddy mortgage lending practices, setting the stage for the housing collapse that plunged millions of Americans into foreclosure. They made a mess of the foreclosure process, using robo-signers to speed foreclosures and foreclosing on homes they either didn’t own or that weren’t even in foreclosure. They sold deals to investors that they knew would fail, and took advantage of customers with outrageous overdraft, credit card, and other fees. .............(more)

The complete piece is at: http://thinkprogress.org/economy/2011/11/18/372044/exploiting-purpose-banking/

[The Straight Story]

1. Worked there for 5 years myself, it was a cesspool in many ways.

Many good, hard working people. But the corruption was evident (and still is, have a lot of contacts there who are fed up with the place)

I had a lot of good engineers that worked for me, most all have lost their jobs - sort of. The company decided, for some reason, it was better to pay a contract company 90k/yer per person than to pay people 65k/yr as full timers (long story, lots of politics and such). The contract company pays them 45k/yr at best for the same job they were doing before.

So many stories from working there...

[rfranklin]

2. You could say that about almost any business...that's why regulation is a prudent policy...

The marketplace can regulate some businesses but when you have entire industries that have shown that they cannot self regulate and the marketplace is unable to regulate, then the government has to step in.