Porn, Pot and Payday Lenders Unwelcome in Banks
For most individuals and small business owners, having a relationship with a bank or credit union is as essential as basic utilities. You could no more open a restaurant without access to the payments system than you could without access to running water. Adult film actor Teagan Presley and her husband, director Joshua Lehman went public with complaints about JP Morgan Chase closing both their …
Questions and Answers
And what can I do about it? I have never been late on any payments or do I have any credit out on the business right now. The business has run for three years without a loss. I have perfect credit and that account had about $10,500.00 in it. What gives?
This is a saves account that had about $10,500.00 in it that they took and closed. They took the cash! I have no credit that I am defaulting on, I have no credit at all against the business and I have prefect credit. What gives?
Welcome to the reality of the reason behind the "bailout".
Banks have slowly, but surely, reduced credit lines, increased interest rates and shut off lending for business and people.
This is the "meltdown" we keep hearing about.
I've had 3 cards, that I have minimal balances on, reduce my credit limit to just above the balance, even though I am never late and pay more than minimum.
More than 3 banks, tripled my interest following the mandate that minimum monthly payments doubled (thanks Congress!). Needless to say, they no longer have my business.
Anyway, this is why the "bailout" is so flipping important and this is why those citizens that keep harboring resentment towards Wall Street for their greed don't get it.
As a small business owner, we just have to figure out how to get by without credit. Because at this point, no one wants to lend us money.
Things are going to get real rough around here, real fast.
Which one should i get? This is going to be my first bank account.
Your first bank account… That usually means one checking account – and maybe a savings account later but the combined balances won't be anywhere near $250,000 and you don't own a business (which produces its own issues). If that's all true…
FDIC: Don't worry about the "brand name." I lived in Texas in the 80's, and learned that big banks sometimes get in trouble, and you can't really predict it. In the U.S., the key is to get a bank with FDIC coverage, which all these big banks have.
CONVENIENCE: One factor that a lot of people don't consider is location. Sounds silly, but look at the bank branches and ATM's that you drive by. If the bank branch is on a corner you drive by, but it would take you 10 minutes out of the way to stop, you may stop at another bank and use their ATM. Those fees add up (that used to be a bigger factor than it is now since you can get "change" when you use your ATM card to buy stuff). Also, you know your daily routines. It's very important that the bank be as convenient for you as possible. This might be conveniently-located branches or a cool website. I have an account at BofA, and their online banking site is good. One last thing – don't go just for low fees. Depending on your situation, it may be worth it to think of convenience first… A $5/month difference is less than 20 cents a day.
PEOPLE: After you've weeded out some inconvenient banks, meet the people at a couple of your "prospective branches." Not looking for anything in particular, but make sure you're comfortable and the people aren't clueless. If they ask what you're doing in their bank, tell them. I'm sure they'd love to "sell" you an account, especially since you may be young… They could get a customer for life.
FEES/DEALS: Google the bank name and see what they're offering as far as fees go. Sometimes you can get free stuff, but I doubt anyone's offering it now. EVERYBODY will offer a no-fee checking account to a someone who will deposit $100,000, but as a new account, you'll probably pay (there were a few free accounts a couple years back, but I don't think so now.) Look at the fees. I googled "low fee account [Bank Name}" No links because it wanted me to enter a zipcode, and that wouldn't have helped you.
One last thing: If you make a mistake, no big deal. It happens. Be ready to move your money in 6 months if you find a better bank. That's not unusual.
IM STARTING TO RUN MY OWN BUSINESS AND I WOULD LIKE TO OPEN A BUSINESS ACCOUNT.
WHICH BANK OFFERS BETTER SERVICE FOR BUSINESSES? WHICH ONE OFFER AN EASIER TO GET CREDIT OR FINANCING? I HAVE A 5 YEAR RELATIONSHIP WITH EACH BANK, but I dont know which should I pick to administrate my business.
ALSO: It is mandatory (by law) to have a business account if you are self employed?
Chase is more flexible in their underwriting guidelines for businesses. They publicly committed to lending 10 billion (that's billion with a "b") to small businesses in 2010, which dwarfs other bank's small business lending (including Bank of America)
Additionally, if you are interested in traveling, Chase has a much better airlines rewards program with their debit card, earning you 1 point for every dollar spent on you debit card.
It is not mandatory to have a business account because you are self employed, but it certainly makes things easier come tax time.
Choke Point Check-In: Constitutional Concerns in DOJ Targeting 'Risky' Businesses (Reason Magazine – Hit and Run)
"Furor grows" over the Department of Justice's (DOJ) "Operation Choke Point," writes Walter Olson of Cato's "Overlawyered." Chase bank has been closing porn star, payday lender, and other "high-risk" business bank accounts, possibly under DOJ pressure. And though this has been happening since at least May 2013, little attention was paid to the initiative until the recent closure of adult film star Teagan Presley's Chase account wound up throwing the DOJ dirty business into the spotlight. Now even _Cosmo_ is talking about it.
Operation Choke Point was initially pitched as a crackdown on web-based payday lending businesses that lend into states that prohibit it. Now it may have overreached into the wrong industry by targeting those in porn, wrote Iain Murray at _National Review_. Unlike, say, online gambling sites or Internet pharmacies, making pornography is a protected First Amendment activity.
Also constitutionally protected, obviously, is buying and selling firearms—but businesses selling ammunition and guns are also on a list of potentially high- risk businesses that banks should look out for. Hans Bader of the Competitive Enterprise Institute looks closer at the potential legal case against Operation Choke Point:
> The First Amendment can be violated by deliberately burdensome investigations, even in …