JPMorgan’s $2 billion trading loss was bound to have big consequences but few could have guessed the fallout would reach all the way to the Buffalo Sewer Authority.
City Comptroller Mark J.F. Schroeder has agreed to transfer $45 million worth of Sewer Authority funds from a JPMorgan Chase account to local bank First Niagara Financial Group after Occupy Buffalo raised concerns about leaving the money at JPMorgan, the Buffalo News reports. The move comes with a number of benefits, including a higher interest rate and more local branches that make it easier for employees to cash paychecks (h/t ThinkProgress).
“It also sends a crystal-clear message to JPMorgan Chase that the City of Buffalo is not happy with their business practices," Schroeder told Buffalo News.
The city's decision to transfer its money comes just weeks after JPMorgan's $2 billion trading loss, which caused significant damage to the bank's reputation. It's also a victory for Occupy Buffalo, which has been demonstrating against JPMorgan for months. The group organized a protest in front of a JPMorgan branch back in October advocating customers withdraw their money from the nation’s biggest banks.
The Occupy movement has had success in getting other cities to loosen their affiliations with big banks. Both Los Angeles and Kansas City have approved measures that deter officials from doing business with banks that have been accused of predatory lending.
Meanwhile, Occupy Austin convinced its City Council in March to come up with recommendations for divesting city funds from Bank of America, YNN reports.
In addition, Bank Transfer Day, a social media push affiliated with the Occupy movement, saw account holders throughout the country pull their funds from banks and open accounts with credit unions late last year.
Churches too have taken a unified approach to pulling funds from the nation’s biggest banks. A record number of church foreclosures last year, in part, has promptedcongregations across the country to withdraw funds, including 25 churches that took out $16 million from Wells Fargo, JPMorgan and others, The New York Times reported in March. In addition, a priest in San Jose pulled $3 million from BofA to protest foreclosure practices last November, Bay Citizen reports.
Los Angeles, New York City Councils to Pass Responsible Banking Ordinances
Momentum Builds from Coast to Coast to Leverage Taxpayer Dollars to Hold Banks More Accountable During New Bottom Line’s “Move Our Money” Month
New Bottom Line Co-Director Ilana Berger Available to Provide Overview of Nationwide Trend, Make Connections to Local Groups Working on Ordinances
(New York, NY) On Tuesday, the nation’s two largest cities, Los Angeles and New York City, are expected to pass Responsible Banking Ordinances to collect better data on banks’ community reinvestment activities and encourage institutions that want to do business with the cities to be more accountable to local concerns. LA Mayor Villaraigosa is expected to sign the ordinance, making Los Angles a national leader in bank accountability.
Similar ordinances are being considered in Oakland, CA; Seattle, WA; Boston, MA; Austin, TX; and Portland, OR. In March, homeowners facing foreclosure persuaded the City of Brockton, MA to move its money out of Bank of America, JPMorgan Chase, and other big banks that refuse to negotiate loan modifications. In February, the Kansas City, MO City Council passed a resolution directing the city manager to select banks that are responsive to the community’s needs and do not engage in predatory lending.
“Nationwide, citizens are looking for ways to hold the banks more accountable and demanding that their tax dollars are placed with institutions that help rather than hurt them. Cities are huge customers of banking services. It makes no sense to reward big banks like Bank of America, Wells Fargo, and JPMorgan Chase that tanked the economy, continue to foreclose on millions of families, and aren’t helping to rebuild neighborhoods,” said Ilana Berger, Co-Director of The New Bottom Line.
The Los Angeles ordinance will gather data on banks’ participation in foreclosure prevention and home loan principal reduction programs, as well as other community reinvestment information. The New York City ordinance would require banks to provide information on reinvestment activities, including foreclosure and loan modification information, that would be used to evaluate the banks that want to hold city deposits.
The Los Angeles and New York City Councils take this action during “Move Our Money Month,” sponsored by The New Bottom Line, which assists organizations and individuals with divesting funds from Wall Street banks and opening accounts at smaller institutions and credit unions that support local communities.
The Move Our Money Website gives customers tools for moving their money, organizing actions at banks, and reporting back the amount of money moved. To date, almost $80 million has been moved since the Move Our Money campaign launched in November, 2011. This video Why It's Time for The New Bottom Line explains how the big banks have consolidated (from 37 banks 20 years ago to just four today, controlling $7.7 trillion) to sap families and communities of resources and how everyday people are working to create a new economy that works for all of us.
The New Bottom Line is a growing movement fueled by a coalition of community organizations, congregations, and individuals working together to challenge established big bank interests on behalf of struggling and middle-class communities. Together, we are working to restructure Wall Street to help American families build wealth, close the country’s growing income gap and advance a vision for how our economy can better serve the many rather than the few. Coalition members include PICO National Network, National People’s Action (NPA), Alliance for a Just Society, the Right the City Alliance, and dozens of state and local organizations from around the country.
Activists from the 99 Percent Movement took to the streets across America to mark May Day on Tuesday, but their campaign against Wall Street is just beginning. In the month of May, activist groups and religious leaders will again turn their focus to urging customers to move their money from Wall Street banks.
Last week, religious leaders and activists targeted Wells Fargo’s annual meeting, where they protested the bank’s predatory and often discriminatory practices and its lack of accountability for its role in the financial crisis that crippled the American economy. Next week, protesters will target Bank of America’s annual meeting, attempting to call attention to the same problems. Throughout the month, a diverse group of activists will push customers to move their money from Wall Street to community banks and credit unions, according to a press release from New Bottom Line, an organizing group that has dubbed May “Move Our Money Month”:
On May 9, thousands of people associated with the 99% Power Movement — families facing foreclosure, clergy, students, seniors, environmentalists, and others — will descend on Bank of America’s shareholder meeting in Charlotte, NC to urge the bank to keep families in their homes, pay its fair share of taxes, and stop choking democracy through massive campaign contributions. If Bank of America does not enact new policies that are more responsive to the communities it serves, large numbers of customers are expected to close their accounts. [...]
“The 99 percent are making their voices heard by moving their money out of the big banks that wrecked the economy and are doing nothing to fix it. This spring, there will be more people attending bank shareholders meetings than at any point in history and we will see more people severing their relationships with the big banks in favor of smaller institutions that are responsive to community concerns,” said Ilana Berger, Co-Director of The New Bottom Line.
The 99 Percent Movement has successfully targeted Wall Street banks with “Move Your Money” campaigns since last fall, when hundreds of thousands of people switched from large banks to credit unions in October and 40,000 more joined on a single day — known as “Bank Transfer Day” — in early November. Churches and faith leaders joined the cause, targeting banks for dodging taxes and unfair mortgage practices. Churches moved $55 million from Wall Street before Thanksgiving, and San Francisco faith leaders moved another $10 million from Wells Fargo in February.
Such campaigns are expected to have profound impacts on Wall Street’s bottom lines. A Wall Street consulting firm reported in November that the nation’s 10 largest banks could lose as much as $185 billion in deposits over the next year thanks to customer defections, and Bank of America — the activists’ next target — is the most vulnerable among them. According to the report, it could lose 10 percent of its customers and $42 billion by the end of 2012.
A coalition of Wesleyan University students and local activists affiliated with the Occupy movement marched on the Main Street branch of Bank of America Saturday, some closing their accounts and cancelling credit cards, in protest of what they call the bank’s environmentally and economically destructive policies.
This is part of a larger “Move Your Money” campaign on Wesleyan’s campus, encouraging students to withdraw their funds from big corporate banks and invest them with local community credit unions.
Students started their march from the steps of the university library, descending on the bank from campus while chanting and holding signs criticizing the bank for allegedly foreclosing on thousands of homes, funding the coal industry and conducting predatory lending practices.
Activists taped the entry to the bank with yellow caution tape and posted foreclosure notices on the doors and windows. Those attempting to close their accounts were initially refused entry and told by bank representatives to leave the property.
A statement was read condemning the bank’s funding of mountaintop removal and “careless gambling of the health of the global economy” before students marched back to campus where representatives from local credit unions were present to help students open new accounts.
Wesleying, the student-run campus blog, offers photos here.
In HBO’s movie “Too Big to Fail,” about the inner workings behind the bank bailout, based upon the Andrew Ross Sorkin book, Wells Fargo is portrayed as not wanting to take the money but handcuffed by Treasury Secretary Henry Paulson. Out in the real world, though, Wells Fargo CEO John Stumpf snuck into the back door of the shareholder’s meeting and refused entry to shareholders demanding answers. The huge bank funds payday loan companies, invests in private prisons and paid no taxes from 2008-2010.
Activist groups claim between 1,500 and 2,000 people rallied outside the big bank’s annual shareholders meeting. Another 150 owned shares of the company but their attempts to take part in the meeting were denied by Wells Fargo, a move that New Bottom Line says shows Wells Fargo’s true colors. In Joshua Holland’s piece on the events from Tuesday, he writes:
Organizers said that some shareholders – not affiliated with the protests – continued to be let in, a move organizers said was illegal.
Video from the event:
New Bottom Line wants people to use May as a “Move Our Money Month” to divest the 99 percent of Wells Fargo. If everyday people continued pulling their money out of big banks like Wells Fargo, opening up accounts at locally owned credit unions, it would result in weakening their grasp on power.
As part of the larger 99% Power, the activists want their demands heard. Much like the events in Detroit, Minneapolis, Houston and elsewhere, you can expect similar activities in the coming weeks. Organizations participating also want people to know they do not necessarily need to take to the streets to make a difference. You can let these large corporations know your displeasure with your checkbooks — don’t give them your money.
Even with the massive rally outside, shareholders awarded Stumpf with another raise, making his total compensation close to $20 million.
“It’s been a very good year for Wells Fargo,” said Stumpf. Obviously!
Meanwhile, Ana Casa Wilson struggles to modify her home mortgage with Wells Fargo writing in an email:
I was born with cerebral palsy and use a wheelchair for mobility. In 2009, I was diagnosed with stage four breast cancer. After my breast cancer diagnosis, my husband James had to take time off of work to care for me. We decided to ask Wells Fargo for a loan modification on the home I grew up and have lived for over thirty years to help ease the burden of losing a paycheck.
Wells Fargo denied my request for a loan modification and decided to foreclose on us. Even though my husband is back to work and we are able to make our full payments, the bank won’t budge.
She is not alone. Others face the similar problems from the banking industry. She is also backed by people from around the country.
Starting next week, credit unions ought to be ready for a new round of “bank transfer” deposits resulting from the activist movement hitting bank shareholder meetings, the head of a Chicago grassroots coalition said Friday.
“We’ve always pulled for a long time for credit unions to get a bigger market share and now I think you will see that happen with thousands expected to show up starting first at Wells Fargo and then at Bank of America in Charlotte,” said George Goehl, executive director of National People’s Action.
The leader of the decades-old Chicago neighborhood activist group was referring to protesters from National People’s Action and other Occupy-like organizations, convening first in San Francisco on Tuesday and then later in North Carolina to vent anger as part of a big bank boycott.
Goehl said National People’s Action shares some of the concerns espoused by a New York group, New Bottom Line, whose “Move Our Money” website has been promoting the annual meeting sit-ins as it pushes an anti-Wall Street theme ranging from payday lending and foreclosure issues to executive pay.
“I think you could say this is the next big ‘bank transfer’ event that’s coming the way of credit unions and small banks and we’ve already talked to some small banks in Chicago and they continue to get new accounts,” said Goehl, who said he expects to fly to San Francisco and Charlotte for the protests.
Goehl said also there seems “to be a story about how in conjunction with increased shareholder activism around big bank meetings. There are efforts to engage many more in moving their money and a very likely place for that money to be moved will be credit unions.”
Asked about the group’s ties with the Occupy movement, which over the last year has been vocal in supporting credit unions, Goehl said National People’s Action has no direct ties to Occupy. He characterized Occupy as remaining a loose-knit organization whose next project is a May 1 general strike with unions taking part in the event.
Ilana Berger, co-director of New Bottom Line in New York, said her group does actively advocate for government and large institutions to move funds to credit unions and community banks and out of the mega banks “that refuse to be held accountable for their roles in the financial crisis.”
Occupy Wall Street protesters say they plan to “take down” Bank of America on Friday by encouraging people to remove their money from the bank.
The “Move Your Money Relay” will include escorting people out of Bank of America branches to help them move their funds to community banks and local credit unions.
Members of the Occupy movement, who have long resisted making specific demands or adopting a leader, say they think that in the case of Bank of America, more specific action is needed.
“We want to make sure that people feel like that is a direct action unto itself,” Occupy activist Nelini Stamp told Alternet, a progressive news site. “It’s not just ‘I’m just moving my money from here,’ but actually people are feeling empowered and knowledgeable about the choices that they’re making when they’re making their banking decisions.”
Bank of America did not immediately respond to a request for comment on the protest.
A recent article by Rolling Stone writer — and Occupy Wall Street supporter — Matt Taibbi compared Bank of America to the “world’s worst behaved teenager.
“They’re out of control, yet they’ll never do time or go out of business, because the government remains creepily committed to their survival, like overindulgent parents,” Taibbi wrote.
Occupy protesters often employ the lessons and jargon of Taibbi, including his famous description of Goldman Sachs as “vampire squids.”
One offshoot of Occupy has already been taking on Bank of America for months, “living-rooming” local branches of Bank of America, meaning its members move furniture into the banks and explain to employees they are moving in because the bank took their homes.
Bank of America last month tried to stem the foreclosure problem by sending proposals to more than 1,000 of its customers asking that they become renters to avoid foreclosure.
In February, The Washington Post’s Suzy Khimm wrote that Occupy’s protests could be having a real impact on banks.
Khimm cited a new study from J.D. Power and Associates that found a growing number of Americans are transferring their money out of large and mid-sized banks: 9.6 percent moved their money in 2011, up from 8.7 percent the year before, and 7.7 percent two years ago.
The most popular reason people moved their money was because of higher fees, such as Bank of America’s proposal for a $5-a-month debit card fee, which the bank later scrapped.
But in a separate survey from Javelin Strategy & Research, 11 percent of people who switched banks cited a grass-roots campaign urging them to switch to smaller banks or credit unions as the reason for their move.
Is Occupy Wall Street hurting banks? Khimm wrote: “At least on the margins.”
In Miami recently, I met up with Laurie Goodman, a senior managing director of Amherst Securities. I’d been trying to meet her ever since I’d read an article that she had written in March entitled “The Case for Principal Reductions.” But our schedules never seemed to mesh. So when I noticed that we were both going to be at a conference in Miami, I wangled a breakfast appointment. It was one of the more illuminating breakfasts I’ve had in a while.
WASHINGTON — An estimated 650,000 consumers have closed their bank accounts and opted for credit union membership over the past four weeks, according to CUNA, bringing the approach to Saturday’s Bank Transfer Day to a crescendo.
In a survey of 5,000 of its credit union members CUNA estimates that at least 650,000 consumers across the nation have joined credit unions since Sept. 29, the day Bank of America unveiled its now-rescinded $5 monthly debit card fee. Also during that time, CUNA estimates that credit unions have added $4.5 billion in new savings accounts, likely from the new members and existing members shifting their funds.