Prison Profiteering in the Land of the Free

Ironically, the “Land of the Free” has the highest per capita incarceration rate in the world. Another bizarre consequence of the “small government” Republican reign of the last thirty years has been that they have told people that they are going to provide “law and order” by making stuff illegal and locking people up. So much so that the prison population has grown by 500% in the last thirty years. I consider this another example of the hypocrisy of the Republican Party; if you believe in a strong central government to fight terror abroad and ensure domestic order by locking people up in record numbers at home, then please say so and stop hiding behind the “we’ll get government out of your life” persona. 

As is typical in strong government arrangements that are sometimes called Facism and other times a free market economy with an aggressive state sponsor, private corporations will often form symbiotic relationships with the policy of state. Just as Halliburton is there to profit from our operations in Iraq, the Geogroup is a private corporation that runs prisons. Typically these types of symbiotic relationships are one of the major sources of corruption; corporations profit from government action and so have money to spend to elect people who will continue such actions. In the end, its an excellent opportunity for private corporations and public officials to make money off of the taxpayers. 

If that weren’t so bad, typically the government actions that engender profit are otherwise destructive to human lives: in order for Halliburton to get those juicy no-bid contracts, lots of people had to die. It’s the same with the Geogroup. In order for the Geogroup to make money, people have to be incarcerated. That means that laws have to be passed and people have to be put away.

This kind of government-private sector symbiosis is often mistaken by democrats as an example of the abuse of a free market system. Let me assure you that it is not. Free markets are about people being able to freely chose what they want without the government making the choice for them. The prison system and logistics support for our military operations are the ultimate examples of a forced choice on behalf of the government. A company driven to satisfy the consumer has a vested interest in keeping them happy, but in this case, the ultimate consumer are government politicians. As politicians are driven by campaign donations and stock ownership, the result are organizations that are non-responsive to the groups they are supposed to be serving. This results in tainted water being supplied to marines by Halliburton as described in the DVD documentary Iraq for Sale: The War Profiteers.

In regards to the GEO Group, Paul Wright of the Prison Legal News says that “They gain their contracts through lobbying and cronyism and political favoritism. They make their profits once they have the contracts through short staffing their facilities and underpaying their staff.” Who are two of the largest stock holders in the GEO Group? How about Alberto Gonzalez and Dick Cheney. All of this came to light for me because a regular on the Howard Stern Show, Kenneth Keith Kallenbach (who can be seen here in all his Stern show glory) died in prison custody. This single death caused an examination of the GEO Group by the Howard 100 News team that has found that an abnormally large number of prisoners died in GEO Group custody. 

Attempts to use the legal process to investigate this has been problematic as you can imagine. District Attonry Juan Angel Guerra said that prior grand jury investigations into the GEO Group had been broken up by police. He finally held the grand jury secretly and returned an indictment against Cheney and company, only to have a judge throw out his indictment and admonish the District Attorney. Mr. Guerra’s interest in the GEO Group may have also been the reason he was voted out of office in the most recent election. All in all, results that are not too unusual for corrupt Facist governments. 

Welcome to the Land of the Free.

How I Took On Chase Credit Card — and Won

Currently, I have two checking accounts and a credit card with Chase. That may not seem all that unusual to you, but it came as a surprise to me since I never actually opened any accounts with them.

I had two checking accounts with Washington Mutual, (WaMu) but they went bankrupt after doggedly pursuing a business model of loaning money to people who couldn’t afford to pay it back. That WaMu went bankrupt came as no surprise. I knew it was in trouble a week before the FDIC. See, I was randomly accosted by a stranger who, when spying the WaMu header of my checking account transactions printout, told me, “you’d better take your money out of there. They’re about to go bankrupt.”

I wasn’t worried about the few thousand dollars I had in the two accounts; It was FDIC-insured, and, if the FDIC couldn’t make good on the money, then all my gold investments would suddenly catapult to being worth far more than the electronic dollars I had lost. That’s the nice thing about gold, it gives you security. Gold ownership is a bit like having children: people that aren’t parents can’t understand the joy of parenthood. Likewise, people who don’t own gold don’t understand the simple security that the yellow metal brings.

Needless to say, I just left my money in there to see what would happen. And sure enough, a week later, I was a JPMorgan Chase customer.

Now, the credit card situation was a bit different. I signed up for a Quicken credit card under the mistaken notion that it would somehow simplify my bookkeeping; but, I never mastered how to download the transactions, and eventually stopped using the service altogether. The credit card was issued through Citibank who, back in ’05, made me an offer to loan me money at a locked-in interest rate of 2.99% for the life of the loan as long as I stayed current. At the time, I had a student loan balance of just under $10K from my college days at Southern Methodist University and was paying 8.5% on that. Seemed like a good move to me, so I paid off the balance with a balance transfer check and signed up for automatic deductions from my then WaMu account so I’d never be late. It seemed like a win-win. I got a loan at a rate below inflation and Citigroup immediately bundled up my loan and sold it to investors through Smith-Barney.

Everyone was happy. That was, until Citibank sold the Quicken card to Chase, which immediately discontinued the automatic deductions. I wasn’t paying any attention to the mail I was getting from them because they regularly flood my mailbox with marketing material anyway — often deceptively tagged to look like I had an account with them.

So, you can imagine my surprise in suddenly discovering that, not only did I not have an account with Citibank anymore, but I now had an account with Chase — AND they’ve declared it past due, thus immediately moving my balance up to close to 20% or so, after tacking on a $39 fee

I immediately called Chase and asked them to reset the account to its condition prior to their taking it over. After all, how could they penalize me for not keeping up on an account I didn’t even know I had? Despite what I felt was a strong argument, I got absolutely nowhere. They refused to budge; even refused to refund the $39 late charge. I asked to speak to management. Got someone who told me the same thing. So, I informed her that if this was the official position of Chase that I would take them to court. She would have none of it.

Oh, well. If it was litigation they wanted …

I filed suit in the local small claims court: total cost, including mail service, was $32, and for my $32’s worth of effort, I got everything I asked for and more. My settlement agreement with Chase does not allow me to put the specifics, but I was very pleased with the result. Incidentally, I also have a foolproof section of getting credit cards to refund those pesky $39 late fees that doesn’t involve litigation in my book in anyone is interested. 

I do, however, want to recount here the details of how I did it, in case anyone out there in cyberspace needed the advice on what to do if this kind of thing happens to you.

Now, I know the perception of taking on a large bank is intimidating. I recently learned a story of a friend who had lost $1K out of his checking account (also with WaMu) due to fraud that was in no way his fault. The bank took the position that it was his problem; he decided to just eat the $1K, figuring that there was no way a small individual could fight a mammoth institution like WaMu.

But that’s where he’s wrong.

This is one of the weird places where the small individual has a large advantage over a corporation, and I’m hoping that more people might realize that by reading this story.

Okay. The first step towards bringing suit against a large corporation is to find out their exact legal name. This can be tricky, because there’s no one “Chase Credit Card, Inc.” to go after. Instead, modern institutions are broken up into bunches of smaller, related corporations, so, the first clue is to look at your statement and check for the institution’s name and state where they’re incorporated. Chase was a Delaware Corporation. With that information, I was able to go to the Secretary of State of Delaware’s website. (Insert the name Chase and there are over 500 entries. I narrowed it down by trying different combinations of Chase and either ‘credit’, ‘card’, or ‘bank’.) I then came up with a couple of corporations titled ‘Chase Credit Card Master Trust’, but, while seeming close to the correct company, were actually separate corporations that took the notes from the credit cards and sold them out as CDO bonds: essentially the same things that happened to mortgages, except with credit cards.

By the way, if you’re wondering what the next shoe to drop is in regards to our banking system, I’ll give you a hint.

What actually cinched the corporate name for me was actually the customer service operator for Chase. I called in and told her that I was intent on suing her employer and that I needed to know what the corporate name was. She told me that it was “Chase Credit Card Services”. I searched the State of Delaware’s database for that name, and came up with “Chase Bankcard Services Inc.” It wasn’t exactly the name the operator gave me, but it was close enough.

I took down the address which, for those of you in the audience looking to sue their Chase credit card, is:

The Corporate Trust Company
Corporation Trust Center
1209 Orange Street
Wilmington, DE 19801

Note: This is not the actual address for Chase, but rather for the company that they have established as their “agent”- meaning that they’re there for the express purpose of being served for lawsuits.

Next, I had to file the claim.

Small claims are filed at the local Justice of the Peace Court (called JP courts by those in the legal profession). I turned to Google and found the closet JP court, went down and filled out the forms. As previously mentioned, it cost a total of $32. Including the cost of sending the suit certified mail.

About three weeks later, I got a call from a Dallas attorney who had been appointed to represent Chase in my suit against them. There is a natural inclination towards antipathy on the part of many people who are now talking to an attorney who had technically been hired to take the other side, but that’s not my style. My ex-wife was an attorney and I knew that she didn’t particularly agree with the clients she represented, so instead of being spiteful, I was instead very cheerful with her. As fate would have it, she had not yet passed the bar, and couldn’t even represent Chase when the case came to trial. Believe it or not, I actually think I had more litigation experience than she did.

Long story short, I represented my case in a very reasonable tone and emailed her what my terms were to settle the case. She said she’d get back to me after speaking to her client. Well, she got back to me today — and told me that Chase had agreed to settle the case for terms even more generous than I had asked for in writing — which felt good.

Now, if I could just get my gold stocks to go up, my financial life would be in order.