The Ugly Truth About Big Banks
Is it time to divorce your bank?
Many Americans hold a checking account at mega-banks like Bank of America, Wells Fargo, Chase, and Citibank. These four banks hold roughly 40% percent of all US commercial assets.
These four banks also have questionable track records reflecting certain shady business practices, ridiculous fees, and investments in destructive environmental and social practices. Let’s take a brief look.
Wells Fargo’s fraud against its own customers is jaw-dropping.
- Opened millions of fraudulent accounts using existing customer data.
- Illegally charged auto insurance, resulting in defaults and repossessions.
- Illegally charged student loan borrowers and withheld critical account information.
- Has a rap sheet reflecting billions in lawsuit settlements.
If you are a Wells Fargo customer, it might also interest you to know that they are the:
- Biggest funder of private prisons in the US.
- 20th biggest worldwide investor in environmentally lethal fossil fuel activity.
That is what your money is supporting in the hands of Wells Fargo.
Bank of America
Bank of America’s rap sheet spans over a decade and it’s not pretty either. BofA has had to pay billions and billions for settlements in lawsuits for:
- Discrimination against women
- Discrimination against minorities.
- Loan servicing and foreclosure abuse.
- Defrauding investors.
- Deceptive advertising of credit card products.
- Unsafe and unsound practices in foreign exchange markets.
- Discrimination against recipients of disability income.
- Violation of overtime laws.
How do they score on the environment? Move over Wells, BofA is the 7th biggest offender in extreme fossil fuel environmental destruction in the world.
JP Morgan Chase has paid millions in settlements for:
- Charging black and Latino mortgage borrowers higher rates than white borrowers.
- Fraudulent debt collection practices against credit card customers.
- Improperly increasing minimum monthly payments to credit card customers.
- Fraudulently misleading investors in the sale of residential mortgage-backed securities.
- Bundling toxic securities and lying about it.
- Forcing homeowners into buying overpriced property insurance.
Their score on fossil fuels? 3rd worst in the world. JP Morgan Chase has invested over 20 billion in environmentally devastating enterprises.
Some highlights that Citibank has settled millions in lawsuits for:
- Charging credit card customers excessive late fees.
- Lying to investors about exposure to subprime mortgage-related assets.
- And, in case you forgot, the Enron scandal.
- The Worldcom scandal.
- Money laundering.
- Racial and gender discrimination.
Their ranking in fossil fuel driven destruction: 9th biggest offender in the world.
Why Do People Get Cold Feet When Thinking About Switching Banks?
What we’re hearing is that people are really done with their bank and are ready for a divorce. Yet, in spite of all of this data, some of us seem to freeze when we think about quitting our bank. Why is this? Let’s explore some of the myths that give people cold feet.
People don’t see a difference.
- Why switch if the experience and rates are the same?
- They aren’t. Why would you stay with a checking account which charges you upward of $10 dollars/month and only offers interest rates of 0.01% to use your money?
- How does ZERO monthly fees and up to 2.00% APY interest sound? Good right?
People are familiar with the workings of their current bank, and while they may be unhappy with it, they at least know what to do and what to avoid. It’s the devil you know.
- While change can be uncomfortable, change that makes you money and contributes to a better world just makes sense.
Most of us have our deposits and withdrawals set up automatically. We are afraid to disrupt our automated transactions for fear that some bills will slip through the cracks.
- This is a valid concern, but if you follow the simple steps below, you will see how easy it is to start a new relationship with a bank that invests in good and makes you money.
Divorce Your Bank in 8 Simple Steps and Switch to a Good Bank
Start a relationship with an institution that can grow your wealth and the health of the planet at the same time.
1-Go for the low hanging fruit.
You don’t have to do everything at once. You don’t have to move all of your accounts either. Start small. Start with your checking account. Here’s an account that pays you up to 2.00% APY interest and cares about the planet.
2-Find a better bank.
If you haven’t found a better bank, you can view some alternatives here. First, take a look at the banking services you currently use, including the fees you are charged. Take stock of your interest rates if you have any interest-bearing accounts. This will help you compare alternative banks.
3-Start with a simple checking account.
Open a checking account with a small balance with your new bank while keeping your old bank account open. Order any products that you need such as debit cards or checks. Start to become familiar with your new bank’s procedures and services by performing a few simple transactions.
4-List your automatic services.
Make a list of your auto deposits (paychecks, distributions, and other forms of income,) and your auto withdrawals (bills, credit card, personal loan, and mortgage payments.)
5-Move your automatic deposits to your new account.
Notify your employer to deposit your paycheck to your new account. Do the same for other types of income. Be sure to get confirmation of the date on which the new deposit directive begins.
6-Move your automatic withdrawals to your new account.
When you are certain your deposits have been transferred to your new account, move your automatic withdrawals to your new account. This can be done easily online. Keep your old account open until you are certain that all transactions are being processed through your new account.
Be sure to keep a sufficient balance in your old bank for any withdrawals that will not be processed until the next statement cycle to clear.
7-Transfer the remaining balance.
Once all outstanding payments and checks have cleared your old account, transfer the remaining balance to your new account.
If you use e-statements at your old bank, be sure to capture any statements you will need for your records either by downloading them or taking screenshots.
8-Close your old account.
And tell them why. There’s nothing more powerful than your voice and your actions.
Good change is good!
It’s time to divorce your bank and move your money to a bank that invests with your values and makes you money. Make a commitment to yourself to make your money matter. Help secure our future generations so that they may enjoy a healthy planet and community.
Your voice is powerful. Use it to make an impact, both in your wallet and on the world.
*The Annual Percentage Yield (“APY”) associated with the Aspiration Summit Account is variable and accurate as of [January 2019]. Rates may be changed from time to time without notice.
Based on a comparison of Aspiration’s up to 2.00% APY interest rate to the following checking account interest rates reported by Bankrate for January, 2019: Wells Fargo (0.01% APY), Chase Bank (0.01% APY) and Bank of America (0.01% APY).
All ATM withdrawal fees will be waived for your Aspiration Summit Account. In addition, your account will automatically be reimbursed for all ATM fees charged by other institutions while using an Aspiration Debit Card linked to your account at any ATM displaying the Mastercard®, Interlink®, Cirrus®, or Maestro® logos. The reimbursement will be credited to the account the same day the ATM fee is debited from the account. Please note, there is a foreign transaction fee of one percent that is not waived, which will be included in the amount charged to your account.
Aspiration Partners, Inc. and its affiliates are committed to “All Extra Services Provided at Cost,” meaning that we’ll only charge you what it costs us to provide the extra service (such as a wire transfer), and not a penny more. Besides these at-cost service charges, the only account fee you pay is the fee you choose, even if it’s $0, which is why we call it Pay What Is Fair.
The Aspiration Summit Account provides customers with the ability to see Aspiration Impact Measurement (AIM) People and Planet scores on a range of merchants where they shop using the Aspiration Debit Card. These scores are determined using a proprietary algorithm that incorporates several measures of sustainability performance. For more information, please click here.
Deposits are insured by the FDIC up to $250,000 per depositor. For more information about FDIC insurance coverage, please visit the FDIC website.