A network of religious community organizers is calling for its members to pull their money out of Bank of America after the bank failed to meet their demands during negotiations on Tuesday evening in Antioch, Calif.
"Just as Moses led the children of Israel out of Egypt, it is time to lead an exodus of our money from Bank of America," said Rev. Mario Howell, pastor of Antioch Church Family, according to a statement. "It is time to go to a bank which will serve us."
The faith-based divestment effort is separate but parallel to the "Move Your Money" campaign.
People Improving Communities through Organizing, a coalition with over 1,000 member congregations across the country, threatened to launch the divestment campaign if Bank of America officials did not agree to their demands, which included a 90-day moratorium on foreclosures. Other groups, including the SEIU and the NAACP, joined PICO at the negotiating table with bank officials.
"Bank of America had nothing -- no new ideas or proposals to offer to keep families in their homes and end the suffering in our communities," said PICO's Rev. Lucy Kolin, who led the negotiations, according to the statement. "We offered them a clear statement of the bottom line: Keep people in their homes. Do no harm. Put in place a moratorium so that Bank of America can get its act together and stop hurting our families and our communities. We went into this meeting willing to be hopeful, but we were disappointed."
A Bank of America spokesman told HuffPost on Tuesday that a foreclosure moratorium would be unnecessary because the bank doesn't foreclose on a homeowner eligible for a modification under the Obama administration's Home Affordable Modification Program.
"In fact, blanket moratoriums put properties at risk, particularly if the property is vacant, and can interfere with the process of reselling properties at market values that could assist with the recovery of local housing markets," said the spokesman.
But PICO maintains that Bank of America has been foreclosing on eligible homeowners and even people current on their payments: "In Texas, Bank of America foreclosed on a family that was current on their payments," said PICO in a statement. "The family discovered this mistake when they returned from work to find they were locked out of their home."
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A Texas homeowner is suing Bank of America for mistakenly foreclosing on a property the bank did not own, according to a report from the Galveston County Daily News.
PICO said that it is asking the Treasury Department to investigate and impose penalties on Bank of America and other banks it says are failing to comply with the administration's modification program. Treasury did not immediately respond to a request for comment from HuffPost.
Congregants prayed and listened to speeches while Tuesday's meeting took place.
"We will fight till we can't fight no more," said Rev. Howell. "We don't want just one or two to get a modification, we want everyone to have a modification! We want everybody to have a new loan! We want everybody to stay in their home!"
WATCH video of Howell's bank-bashing sermon as Tuesday's negotiations wrapped up:
Move Your Money
Are you angry about Wall Street's reckless excesses? Are you disappointed with President Obama's limp approach to reform? You can change this, acting individually and collectively. Withdraw your deposit and savings accounts from the large banks that brought the system to ruin and were subsequently rescued with billions in government bailouts. Put your money instead in smaller, safer banks or credit unions closer to home--the thousands of community institutions that do not harvest their profits from greed and recklessness.
"Move Your Money" is an electrifying slogan that's lighting up the Internet because it shows people how they can push back against the big dogs of banking. The concept is simple, but this is a big idea that could alter the timid direction of financial reform.
This campaign is potentially more than a feel-good gesture. If coordinated with institutional reform efforts, it could lead to a broad rebellion against the financial system, with citizens reclaiming the power to act directly when politicians are too intimidated by moneyed interests to act in the public interest. Economist Jane D'Arista put it crisply: "We are not a nation of widows and orphans. We have quite a lot of money, and people control some of it. They might ask why they don't control more of it."
The campaign was launched just before New Year's Eve by Arianna Huffington of the Huffington Post and Rob Johnson of the Roosevelt Institute. An influential bank-rating firm, Institutional Risk Analytics, donated a website window (moveyourmoney.info/find-a-bank), where citizens can find banks in their ZIP code that IRA certifies as safe and sound.
In the first forty-eight hours more than 100,000 responded with inquiries. Within a week, people had searched for good banks in 16,631 ZIP codes--nearly 40 percent of the nation. The search tool is now getting 45,000 users a day. Naturally, the corporate media promptly assured readers that "ordinary Americans lack the power to hurt the big banks," as a Washington Post headline put it.
Wrong. The cynics either do not understand banking or misunderstand the widespread public anger. Dennis Santiago, IRA's CEO and managing director, explained that banks compete fiercely for the "core deposits" provided by individual and small business accounts--this stable money is their preferred base for profitable lending. Take away core deposits, and bankers feel immediate balance-sheet stress. Expand the account base for community banks, and they gain greater stability and greater lending power. "Will moving your money have an effect?" Santiago asked. "And by effect, I don't mean making a momentary political statement. I mean making a structural difference to the country's financial system. The answer is yes."
Structural change ought to be the primary goal of financial reform--breaking up the concentrated power held by mega-banks and creating a balanced system of smaller, more diverse lending institutions that thrive by serving local credit needs. Alas, the Obama administration and Congress are pursuing the opposite goal--rescuing the behemoths that failed and encouraging even greater financial concentration. This will lead to more reckless adventures, more "too big to fail" bailouts.
"Move Your Money" is an important model for teaching people how to change a dysfunctional system. The same principle of taking control of your own money is at work in related reform movements. A campaign launched by faith-based community organizations associated with the Industrial Areas Foundation identifies sky-high interest rates on credit cards and other lending as the ancient sin of usury. IAF groups are asking churches, foundations and local governments to withdraw funds from the usurious banks that profit by destroying borrowers. Organized labor, likewise, has launched an aggressive movement to insist on responsible investing values for the pension-fund wealth of working people, urging state treasurers and fund managers to invest for society's interests as well as good returns.
Changing the nature of finance capitalism is a long road, to be sure, and the industry will resist change every step of the way. But the fight begins in earnest when people decide to move their money.