Tuesday, November 9, 2010

Lost Morality

This might very well be- the best explanation I have ever read on the moral and ethical state of this country. I think this dude absolutely nails it. I am going to post the link, courtesy of ZeroHedge here:
http://www.zerohedge.com/article/guest-post-banality-financial-evil

This article takes me back. It takes me back to the worst, most unethical job, that I have ever participated in. In the late 80's, I worked for ITT Financial Services in Las Vegas as a loan officer. This is where I got my first taste of corporate greed and corruption. Previous to this, I had been a police officer for 5 years.

Let me tell you how ITT operated. In Nevada at the time, they had no usury law. Thus ITT's lowest interest rate for small consumer loans was 42%. When people called the office and asked what our interest rates were, we were all instructed to say, "it depends on the size and the length of the loan." Interestingly enough, that misleading statement worked. Of the hundred or so calls I took like that, I don't ever remember one person inquiring further.

When we closed loans, every one of them was "packed with credit life and disability insurance." The premium for this was about 800 bucks. It was front loaded and thus the borrower financed the insurance at a minimum of 42%. The insurance paid very little but of course paid the loan off. ITT was the parent company of Hartford Insurance. It was so crooked it defied belief. Many customers did catch this on the loan documents and we would have to take it off in the loan closing booth. Many didn't. It ran about 50-50.

In Nevada at that time, ITT could take anything as collateral including personal property. It was very common. Sometimes our manager would steal the collateral after we took it, convert it to his own personal use, and then pay some paltry amount on the account balance. When a borrower would come in and try to get his collateral back, the manager would say it was "sold" at auction.

Our branch delinquency was so high that we often couldn't collect. We would field chase people with delinquent accounts and try to get them to sign these non cash deferral slips. We virtually never found them. We were instructed to forge non-cash deferral slips on 90 day delinquent accounts.  That way the branch delinquency, and the solvency of the operations were kicked down the road. This made the manager happy, the regional manager happy, the investors happy.

To keep everyone in line, ITT fired people and non compliers (honest people) left and right. I think they fired 3-5 branch managers in Nevada that year. We only had 6 branches, one in Reno. I had never seen such scared employees.

During this time, one of the employees and a friend of mine, quit and began writing paper for a local car dealership. He reveled in the fact that they screwed people on interest rates. If someone qualified for a 9% rate, they would give them a 12% rate. This premium would be passed onto to the finance manager and dealership. He said often they would hit the "trifecta." Underpay for someone's trade in and make money on the used vehicle, sell a car at sticker price and sometimes higher, and then screw customers with higher interest rates than what they were qualified for. They also used credit life and disability to bolster their profits. They offered me a job. I turned it down.

All of these corrupt practices were sanctioned and legal in Vegas. I absolutely hated that environment and unfortunately I was good enough at it- that they offered me a promotion in Reno. I tried to tactfully turn it down. When the Regional Manager insisted that I go to Reno, I finally let them have it. I told them that I hated this company. A few days after that meeting, I called in sick. They fired me. And they didn't give me one thin dime for any of my accrued vacation.

I happily left the corporate world and went back to law enforcement. I was a changed person. My wife could never understand why anytime I walked onto a car lot I transformed into Son of Sam. Or why I refused to finance anything or got contentious with loan closers in the loan closing booth. Why I hate banks, credit cards, finance ops. They prey on poor uninformed people. Like wolves.

It is the acceptance and culture of financial evil and greed that led to this economic collapse. Absolutely everyone that participated in this from the government-to the lenders-to the borrowers- owns this. We have a culture that encourages greed and worships it.  Including a deaf, dumb, and blind criminal justice system which includes the SEC and federal enforcement. All operating under the cloak and protection of the greatest counterfeiter and moneychanger of all- the FED. None of this is really much of a mystery. The only mystery is how long they can keep this charade going.

No comments: