Citing excessive fees, predatory lending, outsourcing jobs to India and other anti-worker practices by TARP recipient
Release Date: June 3, 2009
Washington, D.C. — The National Consumers League, in coalition with Consumer Action, National Association of Consumer Advocates and the Consumer Federation of California, have written a letter to the Treasury’s TARP Inspector General, Mr. Neil Barofsky, and to the TARP’s Congressional Oversight Panel, Chaired by Harvard Law Professor Elizabeth Warren, calling for an investigation of KeyBank’s current business practices and implementation of a remedial process for harm done to consumers, workers and their communities.
In the letter, the groups told officials that KeyBank has a history of engaging in predatory student lending and exposing its customers to excessive fees, and that loans to the bank will serve to undermine the Emergency Economic Stabilization Act of 2008.
Since receiving TARP funds, KeyBank’s behavior towards customers persists as a recent complaint makes amply clear. One customer has written: “Opening an account with KeyBank has been a costly mistake. I have paid overcharge fees and drafts due to the bank’s mistakes! They charge fees for everything, and have no empathy for the customer. They should be ashamed of themselves considering the economy today.”
KeyBank stands out among banks, many of whom also charge excessive fees.
“The National Consumers League and our colleagues find the practices of KeyBank toward students, consumers and workers to be totally out of sync with what the government intended when it provided bailout funds.” said Sally Greenberg, Executive Director of the National Consumers League. “We are distressed to learn that KeyBank is receiving taxpayer funded monies and believe that this is wrong.”
In addition to being involved in shady student loans and excessive customer fees, Key Bank has also engaged in anti-worker behavior, such as providing financing for a company engaged in extensive workers rights abuses, and outsourcing many of its information technology jobs to India. This acts against the interests of the very communities these funds are supposed to be helping.
“We implore the Federal authorities to review their decisions to provide funds to KeyBank, and ensure that the bank’s practices are consistent with the public interest,” said Ira Rheingold, Executive Director of the National Association of Consumer Advocates.
About the National Consumers League
The National Consumers League, founded in 1899, is America's pioneer consumer organization. Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad. For more information, visit www.nclnet.org.