The world of finance today is dominated by huge impersonal entities owned and controlled by investors who may not even know a single person who their institution serves. This radical depersonalization of our financial sector has had devastating consequences.
The most recent scandal involving one of the country’s largest banks gives insight into an industry that has placed profit maximization over anything else – including meeting the needs of the consumers they suppose to serve.
It was learned in 2016 that over the past several years, more than 5,300 employees of a particular big bank created over 2 million fake accounts in their customers’ names because the employees were highly pressured to hit unrealistic sales numbers. Besides violating a sacred trust, this action adversely affected customers’ credit scores as well as saddled the customers with fees for products and services that they did not ask for and did not want. When caught, this bank paid $185 million in fines and fired all of the lower level employees involved.
Upper management, who had created this system of cut throat pressure on lower level employees, were left untouched. In fact, the executive who oversaw this unethical travesty was allowed to retire – with a $124 million retirement package! Speak to industry insiders and they will tell you that this particular big bank is by no means an exception. Many of our country’s largest banks still employ sales tactics similar to what has been described here. Isn’t it apparent that many in the banking industry find themselves serving a false god?
Today, more than ever, America needs her credit unions. The very structure of credit unions – ownership by the members themselves – deters the kind of corruption and obsession with maximizing profit that is so prevalent in banking today.
Catholic credit unions in particular are able to provide an example of how to place the dignity of each individual – both members and employees – at the center of the economic and moral universe. This prophetic witness, encouraged and promoted by every single pope in the past 120 years, serves to bring the light of the gospel into the marketplace.
In the Catholic tradition, money is never an end in itself. It is a tool for doing great things. Because members of a credit union actually own their credit union, the credit union is geared towards serving the needs of each of its members. Profit is always necessary for sustainability, but credit unions are not singularly focused on squeezing the last possible dollar from their members. Stock prices and investor returns do not exist in the vocabulary of credit unions.
In November of 1960 there were over 825 Catholic-oriented credit unions in the United States. Because of the humanizing influence of credit unions, the precursor to the United States Conference of Catholic Bishops (Catholic Welfare Association) actually had a standing committee to promote the creation and flourishing of Catholic credit unions. In Michigan, they even celebrated an annual “Gold Mass” to pray for the success of the movement and strengthen it.
Today, there are fewer than 100 of such credit unions left in the country and the institutional Church in America largely ignores them. In some cases, diocesan finance councils are so populated by for-profit bankers that these councils actually block the good work that credit unions attempt to do. This is not hyperbole, it is first hand experience.
What happened? How did such an essential pillar of Catholic Social Action fall apart in the span of 50 years? Are Catholic credit unions no longer necessary? Have we simply come to a place in the American economy where the current banking structure is sufficiently just and humane?
Obviously not. But there is HOPE.
Catholic Credit Unions of America is a newly formed organization which works to strengthens this great treasure of the Church’s social tradition by strengthening Catholic credit unions throughout the country. We do this through cooperative solidarity and subsidiarity. We invite you to explore this website to find information and resources about a movement which is more urgently needed today than ever.