HOW BIG COMPANIES AND BANKS CAN FEEL FREE TO ABUSE THEIR CUSTOMERS, AND IN MOST CASES NOT FEAR RETRIBUTION
I recently had an episode with a bank in California (I live in New Jersey) from which I had obtained a loan on a classic car. Very simply, I was required to keep insurance on the car. The bank claimed, correctly, the insurance lapsed for two months (while I switched carriers), and then according to the terms of the loan agreement charged me for insurance for those two months, the amount for which was never stated in my loan agreement, of course. Two months would cost me about $200. The bank charged $1,200. Obviously a profit center for them.
I disputed the charge immediately via certified mail (I recommend certified mail letters immediately when a dispute arises) and they failed to respond. They then demanded the $1,200 be paid or they would (and did) mark my monthly payments late (which they never were; it was that I refused to pay the extra disputed amount). After ten months my credit report had been marked late 10 times, and my credit was ruined.
Of course, I fought back. I filed suit in my local New Jersey court against the bank, and had them served in California. I represented myself (more on this later). The bank, at a cost of at least $3,000 hired a local law firm that submitted elaborate papers. It seems that in their lengthly loan agreement, there was a provision that any disputes would be heard in Orange County, California. The Judge fought for the bank, and I was then faced with having ruined credit, or going to California to fight the bank.
This loan was executed completely by phone and by internet and fax. I never visited the bank. The US Supreme Court has ruled (for those legally inclined, the Zippo… case) that such transactions can be heard in the resident state of the consumer. But the clause they had in the agreement (who reads and understand the legalese?) overrode that ruling, according to my unsympathetic local judge.
Fortunately I have occasion to travel to California, and so I filed a summons in Orange County, California, and served the bank. I planned a trip around the court date. The Judge threw the book at the bank, and awarded me $5,000. But that did not help. Although a small claims judge can award money damages, he cannot issue rulings to force the bank to undo what they did. The bank subsequently appealed, and at that appeal (my second trip) I settled, giving back the $5,000, but getting the bad marks removed.
This situation requires a change to the national credit law (the FCRA) which would set the venue of a consumer trial in the consumer’s home state, if the transaction was an internet transaction, as mine was. If not, the big thieving entities can abuse as they see fit, knowing that few, like me, would travel to sue them where they reside. I am glad I did, but I pity those who haven’t the means to do what I did. They would be stuck. If the bank has to travel to the consumer’s venue, they will be much more inclined to settle.
Representing one’s self is not as difficult as it may seem. The courts today have definite rules for those who represent themselves. For those not so inclined, I would urge community action groups to set up a legal advice department, which could be staffed with volunteer paralegals, not lawyers, to help the small guy fight back. Also, the law regarding venue definitely has to be defined and changed in the favor of the consumer.
I understand that the Justizz website will assist consumers in writing demand letters, filing legal actions, and have a legislative platform for laws that need to be made, changed or altered in favor of the consumer in cases such as mine.