Notes from Alternative Banking Meeting of Tuesday 12-06-11
Held at 45 East 20th Street- Office of Independent Diplomat
Representative of the New York Times was on hand. Short background filming of the group was permitted. Voluntary interviews were conducted apart from the group.
More in-depth discussion of possible structures for any desired financial institution took place. Group worked off a working inventory of financial structures item that was distributed.
Decided: Group decided that non-profit was a goal and so any structure needs to be suitable to non-profits organizations.
Next scheduled meeting was set for Tuesday December 13th. 7pm. Location: 45 East 20th street – Office of Independent Diplomat.
The group had just over twenty and some were in attendance for the first time.
Carne Ross convened the meeting around 7pm. He introduced Will Croxton, a representative for the New York Times. Mr. Croxton is part of a team – print + video – that is preparing a story on OWS working groups. He asked that he be allowed to film and record the meeting. This brought up a debate centered on the desire for the group and its objectives to be more known and covered, and the legitimate concerns that many had about personal adverse publicity. A compromise was implemented that would allow 10 min of background filming to be taken for the purpose of having establishing shots for the Times piece. No further filming would go on. Volunteers could be interviewed and/or filmed in an area apart from the group.
There was a short re-cap of the last 11-30 meeting.
Jim C. made the group aware that Paul Volcker would be at the Museum of American Finance at 48 Wall Street the next day 12-07, to make a presentation and take Q & A.
Carne went over the list of attributes that the group is working with and emphasized that we need a practical design for its structure.
Discussed San Francisco and their work in trying to create a municipal bank, and their more immediate project of creating a CU titled People’s Reserve Credit Union. Note: Information here - http://www.facebook.com/media/set/?set=a.10150393701330817.352124.171020735816&type=3
Mark A. discussed highlights of the inventory of financial institution structures that was given out and that people had received in an email. He also mentioned that people might want to review the goals and work of the 1975 San Francisco Community Congress. Info on that Congress, as well as their original produced document here: http://sfcommunitycongress.wordpress.com/about/the-1975-san-francisco-community-congress/
Richard H. discussed the merits of the Benefit Corporation – B Corp – structure, a structure that is now used by a few progressive banks. Difference between B Corp and Certified B Corp discussed.
The structure discussion brought up many questions that would have to be decided.
1- Non-profit Vs Low/Limited profit
2- FDIC Vs CU model Vs non-insurance
3- Any structure must be able flexible enough to allow for our desired values to be built in.
4- Exactly who is the target market.
5- When — exactly — does an institution become a bank, and then guided by banking regulations.
In addition any structure should be very transparent, and needs to be competitive with any present systems.
After discussions about B Corps and L3Cs, the group decided that any structure really needed to be one suited for a non-profit organization.
Alex T. informed the group about the Fed Reserve of Richmond (In the 5th District of the Reserve System and the 2nd largest of the Feds after New York) Info from Richmond Fed on Community Development Financial Institutions here: http://www.richmondfed.org/community_development/resource_centers/cdfi/pdf/cdfi-special-2011.pdf
Michelle M. introduced an item she had compiled on reasons for why an alternative bank and invited comments from the group.
Why an Alternative Bank? Worksheet
Logic Makes People Think, Feelings Make Them Act
The Public’s Hot Buttons – Competitive Advantages of the Alternative Bank:
• Avoid Outrageous Monthly & Special Service Fees (NSF, Late Fees, etc.)
• Bank with People You Like And Trust Who Will Always Act In YOUR Best Interests
• Create a Banking Community Emphasizing Honesty, Truth, Integrity, Trust and Mutual Assistance
• Simple, Easy To Read & Easy To Understand Financial Agreements
• Won’t Deluge You With Lots of Expensive Advertising
• Eliminate Predatory Pricing and Aggressive Sales Tactics
• Willing To Work With Customer / Members When Unexpected Financial Difficulties Arise
• View Foreclosure As A Highly Unusual, Only Very Last Resort Action, Pursued Only When ALL Other Options Have Been Completely Exhausted.
• Energized Educational Environment Emphasizing Economic Empowerment for Everyone
• Low Cost International Money Transfers For Immigrant Communities
• Reasonably Priced Pay Day Loans Offered As Interim Steps To Financial Stability
• Provide A Pleasant, Supportive Working Environment For ALL Employees
• Eliminate Outrageous Executive Pay Packages & Bonuses – Fair Pay For ALL Employees
• Utilize Technology & Strategic Partnerships To Reduce Expensive Brick & Mortar And Other Operational Costs:
Back Office Operations are a major expense and headache – find strategic partners who will provide various services (check processing, investment services like Fidelity – with the Alternative Bank Customer Service group providing the primary customer interface.)
• Offer A Full Line Of Banking Products Including The VERY Best Retirement, Savings & Investment Options, Alternatives & Consultation [Resell Fidelity or other similar high quality Investment provider’s products.]
• Offer Banking Services, ATM, etc. Through Existing, Non Traditional Locations – [McDonald’s ATMs, Post Office, Grocery Stores & Other Major Retailers Accept Deposits / Sell Money Orders]
• High Quality, Reasonably Priced Small Business Programs, Loans & Products
• Special Assistance Support Groups For People Starting New Businesses
• Universal, International ATM Access without Excessive Fees (Cirrus Membership or Partner With Organizations That Can Provide It)
• A Fun, Honest, Enjoyable Place To Do Business
George suggested that a Credit union might be able to be universal by adding a small member fee. All members would now be an affinity group.
Richard H. introduced the idea that any institution might be able to expand into areas like investment banking and institutional services, and not just be limited to retail services. This could revolutionize entire spectrum in financial services.
Mark A introduced the idea that perhaps we could have it all by having an umbrella organization that would hold a CU as a basic component but also have a P2P/Microfinance arm. Additional Note: Umbrella could be organized as a non-profit 501(3)(c)—could do Microfinance under that part.
|The Commons – a non-profit 501(c)(3) organization|
|The Commons – A Good Bank|
|organized as a credit union|
|P2P – SEC + State securities regulation|
Janu S. concurred that perhaps we needed some hybrid structure to enable us to provide all the services we wanted to.
Gabriel suggested that any institution should expand voting rights to people who live in the area and added that the people themselves would tell us what products they wanted and what we would provide.
Stefano B. stated that we also need to think about a structure that would be robust enough to succeed and operate under regulations that are changing and that may change more in the future.
Stefano also suggested that people be aware of the efforts to redress aspects of government actions that may be unconstitutional. Site for Occupy the Constitution is here: http://www.givemeliberty.org/occupy/default.htm
James S. gave a hard copy draft of an item he worked on that includes a Bank Mission, Objectives and services that could be offered along with possible structures. (As of this writing it is not available in electronic format and so could not be pasted in these notes.)
Franky K. — Frank gave the group an update and status report of the Occupy Our Homes direct action that had happened earlier in the day. He stated that it was very positive and peaceful.
Carne closed the meeting and suggested that people follow up on their own questions and come back with information to further the discussions.
Meeting closed – will re-convene next Tuesday – December 13th 7pm. Location: 45 East 29th Street- Office of Independent Diplomat.