Is the Occupy Movement Taking On the Corrupt Financial System?
Below is a report from thenation.com
Occupy Bank Cards!
By Alissa Quart August 12, 2013
“The group started meeting soon after the Occupy movement emerged in September 2011, with its first meeting in October. The members of the cooperative wondered: What if they could flip the banking relationship so that clients (in their diction “users”) owned the bank, rather than the other way around? The fall of 2011 was a dark time for the millions of Americans struggling financially, as well as a moment of dawning consciousness about the realities of today’s banking system, which can seem rigged. After all, banks make big bets and ordinary citizens bail them out; clients play by the rules and then banks stick them with a seemingly endless array of hidden fees, many of which fall heaviest on the poorest Americans. As The New York Times reported recently, even mistakes as small as a bounced check or a tiny overdraft “have effectively blacklisted more than a million low-income Americans from the mainstream financial system” due to obscure private databases that are used by major banks.
As a result, millions of Americans are actively excluded from today’s banking system—a problem in a working democracy where citizens should be able to spend or access their own funds cheaply, safely and easily. In 2011, one in twelve American households was “unbanked”—that is, they did not have a bank account, according to a Federal Deposit Insurance Corporation survey. Twenty percent of households were “underbanked,” meaning that while they had a bank account, they also relied on pawnshops, payday loans and other means of off-label banking.
Banking “is a toxic system” said Occupy Money Cooperative member Ross, who usually serves as the co-op’s unofficial press flack. By day, Ross runs Independent Diplomat, which provides diplomatic advisory services to nonstates or people living in threatened territories, such as the Sahrawis, the stateless people of the Western Sahara. Before that, however, he made headlines as a British diplomat who resigned after giving then-secret evidence to a British inquiry investigating the bogus intelligence claims that brought us the Iraq War. And now he is turning his attention to the banking industry, because, he said, “You don’t have to do a lot of research to see banking is a racket and the state is insuring private banking industry.”
For Ross and the other co-op members, bank cards represent one of the system’s more obvious, and perhaps fixable, rip-offs. Today, plastic is fast replacing cash as the medium of basic exchange. Yet most debit cards require a checking account (in return for which they are usually fee-free). And while pre-paid bank cards have few barriers to purchase (no credit checks, no wait), they are also relatively unregulated and tend to nickel-and-dime their users, many of whom are poorer to begin with (those living from paycheck to paycheck, the unbanked and the underbanked).
Take the now-defunct Kardashian Kard, a cutesy (kutesy?) yet predatory nightmare bearing the figures of three of the raven-haired reality-sisters on its shiny surface. It cost $9.95 upon purchase and then twelve monthly fees of $7.95 for a minimum of one year, which meant that just getting to use the card for a year cost more than $100. Kardashian Kard users were also charged $1 every time they added money to their card and $1.50 to speak with a live operator. Suze Orman’s prepaid debit card is less expensive but still costs a $3 activation fee and a $3 monthly maintenance fee.
In contrast, the Occupy card would require only a modest ninety-nine-cent fee and no monthly fee at all. That would make it more accessible to Americans who were otherwise being exploited by fee-laden cards.
To the members of the Occupy Money Cooperative, high fees for cards are just another symptom of a larger disease. As one member of the co-op put it, they are motivated by the belief that today’s banks are “unredeemable.” The cooperative model exists elsewhere in banking, of course: the main example is credit unions, which are owned collectively by those who hold accounts and which charge small fees or none at all. And the hope is that the Occupy Cooperative will resemble credit unions in that every member will use the co-op’s services and some may even work as employees of the co-op.”