![\"user-pic\"](\"/css/images/default.gif\")
I don't know whether this is good or bad overall. It seems good because its sticking it to BoA (which is needed) and good for employees, but also seems that maybe this was a little harsh? Unfortunately (or fortunately =P ) companies need harsh results to learn from things anymore.
![\"user-pic\"](\"http://consumerist.com/assets_c/userpics/userpic-119816-100x100.png\")
Bank of America get its comeuppance. They are the single worst bank on the planet. Every time I hear that tag line, \"bank of opportunity,\" all I can think is \"Yeah, opportunity to shaft me!\"
![\"user-pic\"](\"http://consumerist.com/assets_c/userpics/userpic-98962-100x100.png\")
I like this decision. I hope more states adopt this policy. \"If you want to do business here you'll release your lines of credit. No business license or government contracts for you.\"
![\"user-pic\"](\"http://consumerist.com/assets_c/userpics/userpic-76955-100x100.png\")
The gov. should be putting pressure on banks that participated in the great $700 billion bail out to lend that money to local companies. But should BOA be lending to a company that makes windows and doors when the construction industry is in the crapper? Who gets to make that call?
![\"user-pic\"](\"http://consumerist.com/assets_c/userpics/userpic-93244-100x100.png\")
@SadSam: Funny times in America. Here in Canada, I can't get a window company to install a window before February/March they're so over-booked. They should sell their excess capacity and bring some workers over here.
@SadSam:
All that stuff can be used for renovation and upgrades, right? Which will be growth areas as people and businesses try to make do with existing locations.
I have a BofA account, but it's just a place to park money for my ATM card; everything else is through my credit union. If they said they'd open up credit? And they didn't? They need to suffer the consequences.
This is the problem, though: you and I care. We go on Consumerist and we write letters and spread word of mouth, both good and bad where we think it's warranted. But, we are a drop in the bucket, we are specks of dust compared to the kind of people in the previous story who jeered as a Walmart worker died in front of them.
@SadSam: It's not so much about taking care of this company, which has already decalred bankruptcy. It's about not leaving the workers in the lurch.The workers really just want to be paid for the work they've already done. The company is closing down, but the workers aren't being given the severance pay that is due to them
@Anathema777: Isn't that money usually kept by the company in reserve for just such an event? You can't declare bankruptcy and THEN promise workers severance, then complain that you were already broke.
So the company has already declared bankruptcy and the workers and state are mad at BOA for cancelling a line of credit. Not knowing the details and recognizing that it sucks for the workers it seems reasonable for BOA to cancel a line of credit for a bankrupt company as it seems unlikely that BOA would ever get paid back on that LOC. Shouldn't the workers be looking to the company for compensation?
@MrsLopsided: Right. They have closed the business entirely with lots of loose ends to tie up and no money. There is also some question as to the location of some inventory that is supposed to be on site. Seems to me that Illinois' actions are pointless since the business no longer produces anything as of Dec. 5th. Perhaps rather than crying \"foul\" on BoA (trust me, I am no fan), you should look at the ridiculous plan of fractional reserve banking, which allows the banks to loan money that doesn't actually exist.
@Anathema777: Since when did B of A have an obligation to the workers of the company? They're a CREDITOR.
@mookiemookie: They're a creditor that got bailed out by the government because they argued that they were too big to fail. In return, they were supposed to help prop up the failing economy that bailed them out. I think that gives them an obligation.
@Anathema777: Let me get this straight: B of A makes crappy loans and gets a government bailout. They're then supposed to use the bailout money to make more crappy loans.
Riiight...
@mookiemookie: Since the money then goes to the workers, who can do things with it like make their mortgage payments and maybe avoid adding to the foreclosure mess...yes.
Ever since BoA received a slice of $700B cake funded by taxes paid by those same workers. Whether you (and BoA) like it or not, BoA is now indebted to pretty much all the tax-payers of USA. Perhaps we should reduce the limit on their credit card and bump up the APR...
@Andr0: Then by that definition, shouldn't the state which received money from the employees paychecks ALSO be held responsible for paying their severance?
![\"user-pic\"](\"http://consumerist.com/assets_c/userpics/userpic-242944-100x100.png\")
@Git Em SteveDave loves this guy->★:
The bank though is a private business. Where as the govt is well, just that. It's not private and its funded by everyone and not for profit. BofA is a for profit business. If you help out a for profit business they should help back.
I can see it from both sides, why BofA said no and why the states pissed. I think the state is just using this as an example to run with the idea. More of a scapegoat if you will.
@socalrob: Well, if the state is a \"for loss\" business, then they should have no problem paying out if there is no expectation of return. The bank has a responsibility to it's share holders and it's employees to try to stay afloat. Just giving out money with no hope of getting it back doesn't go towards that goal. I also doubt we as tax payers want BofA giving our money away.
![\"user-pic\"](\"http://consumerist.com/assets_c/userpics/userpic-53248-100x100.png\")
@mookiemookie: What the State of Illinois is angry about is that many banks who received bailout money are sitting on that money, instead of using it to continue lending.
The point of the bailout was supposed to be to purchase bad debt so that the banks could continue to lend funds. Lending increases businesses at all levels and stabilizes the economy from the bottom-up. Unfortunately, that isn't what is happening. The bailout has been used to save AIG, to let big banks gobble up little banks, and to keep many financial institutions afloat, when they should have closed their doors two months ago.
@SadSam: Yep, it's hard to know if BofA are being asshats or being responsible. I read that Republic has been making payments on time to BofA, but BofA may know something about Republic that prompted the shut off.
![\"user-pic\"](\"http://consumerist.com/assets_c/userpics/userpic-332258-100x100.png\")
@TWinter: Yep, it's hard to know if BofA are being asshats or being responsible..
That's what the media and politicians are for..sorting out the finer points of such thorny issues. At least they've always done such a great job with it in the past.
/switching sarcaso-meter off...
I like this policy too. Failing states like Illinois can pull their business from BoA and free up more credit for more productive states to utilize.
Come on people, Republic Windows and Doors is obviously a failing company that would default on any additional credit BoA gave them. Otherwise BoA wouldn't have yanked their line of credit in the first place.
@Shivved: I couldn't agree with you more. Looks like the company is pointing fingers at BoA to distract from the fact that they'd default on the LOC if it was further extended. Hell, they're probably already going to default with what they have. Wasn't this whole mess started by making stupid decisions about credit... and now we are bitching when a bank is making an intelligent decision concerning credit-worthiness?
![\"user-pic\"](\"http://consumerist.com/assets_c/userpics/userpic-87429-100x100.png\")
Just funny how banks are getting our tax dollars, and instead of doing what Congress told them to do with the money, they are buying up smaller banks, increasing fees and credit card rates, hoarding the money and basically not using it to help the economy at all.
I just hope they are asking for both BoA credit and a reopening of the plant. If the plant isn't going to reopen BoA has no choice but to stop the credit. Maybe the plant did close because BoA initially pulled the credit, but does the parent company want the plant open? Do they think by spring they will be making money again? BoA cannot give credit if they know they will never get paid back. It sounds like the state of Illinois should be offering a bailout loan. If they don't trust the company enough to offer their own loan, it's absurd to attack BoA.
@Corporate_guy: Doesn't this company still have a lot of merchandise? I think that even if the factory closes, BOA should be able to recoup their losses with those items.
@Anathema777: The question is, did the parent company fight BoA? Offer collateral? I bet they did not. BoA probably denied credit and the parent company decided they didn't want the plant. They told the workers to blame BoA so they would be left alone.
@Corporate_guy: BOA offered credit and rescinded that.The window company made decisions based on that. If BOA chooses to change terms they should be required to do so in advance, not say sorry, no money foryou now.
![\"user-pic\"](\"http://consumerist.com/assets_c/userpics/userpic-177822-100x100.png\")
@Anathema777: Yeah, but who knows how many other creditors will be scrambling over that merchandise as well?
Wait, aren't we upset about the banks making bad loans to start all this? What's the point of the bailout if they keep loaning money to people (or businesses) who can't pay it back? See here: Many Borrowers Re-Default After Mortgage Is Modified ([www.cnbc.com])
I agree that BoA sucks, but did we keep them from failing just to encourage them to fail later?
![\"user-pic\"](\"http://consumerist.com/assets_c/userpics/userpic-101046-100x100.png\")
@K J: Why did we even bail out this piece of sh*t bank in the first place?
Note to Congress: You have no f*cking clue. I WANT MY MONEY BACK.
@doctor_cos: Ok, you want the $20 dollars of your money that went to BoA. In actuality it's probably less than that.
@Valhawk: Lets do the math. 700 billion divided by 138 million taxpayers equals a little over $5000 per tax payer. Since it was borrowed money (the US government pays interest on their debt, it means a lot more than $20 to that poster
@K J: This wouldn't even be news if there wasn't a trend of banks not opening up credit lines to consumers/businesses. It's the static behavior that has everybody concerned, not just this incident, per se.
Besides, BoA-bashing is just too much fun to pass up.
Welcome to the \"Strings Attached\" part of the bailout. Get ready Detroit, you are next!
![\"user-pic\"](\"http://consumerist.com/assets_c/userpics/userpic-186777-100x100.png\")
As I understand it, the business closed down. The company didn't have the cash to pay the workers, hence the closing.
BofA (and believe me, I hate them too) is refusing to loan money to a company which has already shut down, on the basis that they won't get paid back. That seems reasonable to me. It sucks that the company went out of business, but the fact that BofA won't lend to a business which has no revenue stream and is probably already in debt seems smart to me.
Am I missing something>
@m4ximusprim3: If the company shuts down, the union should force it into involuntary Chapter 7 to at least have the workers' vacation and sick days earned within 180 days of the bankruptcy treated as priority debt in a dissolution.
Still don't know what BofA's loan was - was it a secured line of credit or a general unsecured?
![\"user-pic\"](\"http://consumerist.com/assets_c/userpics/userpic-21984-100x100.png\")
@m4ximusprim3: Often states have work clauses which require businesses to notify workers within a certain time that they are being laid off - for any reason. I just heard on the radio this morning that the company had not complied with any of the State of IL requirements to lay off workers.
![\"user-pic\"](\"http://consumerist.com/assets_c/userpics/userpic-490080-100x100.png\")
@econobiker: This scenario happened to me and a few other salaried full time employees about four months ago at a much smaller company. We were laid off on pay day with a \"sorry, we can't make payroll--but we'll get it to you soon.\" So we were shafted out of 1 months' contracted severance and two weeks of pay for actual work. But I feel powerless and don't know how to go after these guys. If the LLC has dissolved, can I still take the individuals to small claims? I lodged a complaint with the Dept of Labor but the office is closed and the business, for all intents and purposes, no longer exists. Thank goodness I had a savings account and was able to get through 4 months before finding a great new job, but I'm still very angry about being shafted out of three entire paychecks.
@Valhawk: Yeah, so I may have missed the part where he blamed it on a bank, rather than, you know, the company that screwed him. I guess it's my damned ability to comprehend what I'm reading that gets in the way. It's such a curse!
@econobiker: Right, which is definitely very naughty of the company.
I still don't see how that should force BofA to loan money to an insolvent company who obviously won't be able to pay it back. It seems like bailout by proxy to me.
Which is fine, I just wish they'd call it what it is.
I'm strongly in the liberal Democrat column and support the workers, but being from Illinois this looks once again like Blagojevich is making a silly PR move before all the facts have been laid out.
![\"user-pic\"](\"http://consumerist.com/assets_c/userpics/userpic-380019-100x100.png\")
@azzy: Exactly what I was going to say. Blago (and possibly his wife) are a few steps away from an indictment yet somehow he might still want to run for re-election. This is the perfect way to get some good press out of this mess.
![\"user-pic\"](\"http://consumerist.com/assets_c/userpics/userpic-462821-100x100.png\")
While this story makes me quiver because it's government and buisness...I realize two things.
1. That the bailout was supposed to trickle down but it seems to be stuck in the wallets of the banks
2. I really fucking hate Bank of America, if Ken Lay went to Guantanamo, I'd end up being a hypocrite because I'd be the first one on the phone with his congressman begging to keep it open \"Cant we waterboard him just five more hours!??!?!?\"
Oh and yes as far as \"being a threat to America\"
Terrorist < Bank of America
/bitter
@Wormfather is Wormfather: Your coming to this conclusion because BoA has decided to start lending responsibly? I mean why is it a bad thing that they won't make a loan to a business that's going to dissolve no matter what they do.
Didn't we just chastise them for making loans that would never be repaid?
@Valhawk: Acutally, BoA has been one of the more responsible banks since the begining.
I just hate them, it's deep seeded and irrational but it exsists and it's not going to change. Hell I'm invested in BoA but I'd take the hit on my books to see them stumble.
What I wouldnt give to see BoA begging congress for money.
![\"user-pic\"](\"http://consumerist.com/assets_c/userpics/userpic-287896-100x100.png\")
I got an interesting phone call from BofA this morning. I have/had a line of credit with them, and they were looking for me to somehow pay more than the minimum payment each month like I used to.
I ran into some financial difficulty (unemployed for nearly a year) I was late on a few payments and frankly, they treated me like I was some kind of criminal. I have diligently paid them on time for months now, Called repeatedly and begged for interest rate decreases and was always told no.
Right now I am doing Dave Ramsey's snowball plan and have managed to pay off quite a chunk of my debt. They offered to lower my interest rate to 4.42% (from 16.89) if I agreed to close the account and pay it off in 60 months. I was planning to close it anyway as soon as I pay it off. They emphasized over and over, that they wanted me to consider my experience with them as being a good one and that they were aware that their reputation was not the best and were making efforts to change that. I still don't know what to think of it.
@ohiomensch: They're probably thinking you're going to file bankruptcy, so they want to get you in something where they get a little bit better than a Chapter 13 (they wouldn't get interest in a 13, and would get a fraction of your debt in the plan).
@ohiomensch: Wow lower your deal to 4.42% from 16.89%??? Some people would love 16.89% versus 29.99%.
It sounds like they are trying to get you on a different loan (60 months)versus paying down your exisiting CC debt.
@econobiker: Agreed. What strikes me as funny is sometimes the people on the other end of the phone don't seem to understand \"having a bad-luck streak\". Yes, I was un-employeed for a year, BUT now I have a job and want to pay off my bill quickly. Then they offer you low payments over 17 years.
![\"user-pic\"](\"http://consumerist.com/assets_c/userpics/userpic-431264-100x100.png\")
It does not matter if BoA gives money to Republic or not.
What does matter is that the State of Illinois is trying a grassroots tactic to get the bank to do what it is supposed to do...
@radiochief: Yes their supposed to make loans they know will default. Oh wait, that's what got us into this mess in the first place.
You can't tell banks to lend responsibly and then harp on them when they won't lend to a business that's going into bankruptcy.
@radiochief: Banks are not SUPPOSED to loan money to business who can't pay it back because they're INSOLVENT.
This would result in more insolvent banks and more bailouts. Shitty business owners aren't BofA's fault.
@radiochief: No, the bank is supposed to extend credit to people who, _in their opinion_, deserve it. It is absolutely 100% insane to have the government start dictating to private establishments who does or who does not make a good credit risk. The bail-outs were similarly nuts, IMHO.
Atlas Shrugged is coming to life, and I am completely terrified.
![\"user-pic\"](\"http://consumerist.com/assets_c/userpics/userpic-83385-100x100.png\")
@Erwos: I am with you on this one.
@LostAngeles: I think you are misunderstanding Atlas Shrugged. The people who would leave us now are the TRUE minds of industry...not the ones cashing in and producing nothing.
Interesting that it takes a smaller government body (as in state rather than federal) to hold BoA accountable for their mismanagement on the bailout funds it received. It's amazing how the banks promised to make more credit available to everybody... if only they could get a bailout. Seems very similar to what the auto industry is promising and likely won't deliver on.
@BrianDaBrain: Did BoA receive bailout funds? Not every bank received them. I honestly don't know one way or the other.
This is totally stupid. BOA should not be forced to extend a loan to a company that cannot pay it back. If they company is having troubles, they need to figure out how to bail themselves out and then work on restoring a line of credit. This is how we got into this mess to begin with, the goverment softening up standards so that people with no business getting a loan were extended one. The bailout is only making matters worse.
So, to be consistent, will Illinois stop doing business with every bank that yanks a business's credit line because the business is failing? Because this isn't just a show, right? There are obviously no other banks doing this?
Just because there was a bailout doesn't mean that all common sense is abandoned.
If the governor is mad at the people being laid off improperly, go after the business owners, who are doing the misdeeds. The bank, and every other bank like it, is just operating by normal rules.
Please remember a very important part of the situation here: Gov. Blago is ONLY doing this to try and help himself politically. He doesn't really care about the workers, he is just trying to score points to help out his reputation, which is in the crapper.
This angers me as much as the entire situation. While BOA is supposed to be loosening lines of credit, they aren't, but I don't think it's gov'ts. role to be telling private enterprise who they can and can't lend to. But since the bailout, the entire system is fucked and it seems the rules don't count anywhere anymore.
If the workers are entitled to severance pay and vacation pay per their contract, it should be honored, plain and simple, regardless of who or what caused the company to close its doors.
But again, Blago's motives are purely selfish and politically motivated.
@minsky: Their supposed to be loosening lines of credit to businesses that are not in default. Making this loan is throwing money away for BoA, and really defeats the point of bailing them out.
![\"user-pic\"](\"http://consumerist.com/assets_c/userpics/userpic-605040-100x100.png\")
Meanwhile John Thain is going before the compensation review board today at Merrill Lynch because he feels he is ENTITLED to his 10 million USD bonus!!!!
It's a PR stunt, that's all our governor does. He's a shmuck, a politician in the worst sense. The newspapers reported last Friday that the feds put a wire on one of his cronies. He's the focus of a federal corruption investigation. The lieutenant governor hasn't spoken to him in months. The Dems control the governor's mansion and the statehouse and he can't get along with anybody, nothing gets done here but corrupt back room deals. And the scary thing is, he ran for governor as a Democratic congressman promising reform and a new era after an unpopular Republican executive. Sound familiar? Obama, anyone? They both have ties to jailed felon Tony Rezko. Look for Osama to steal a few pages from Blago's playbook. BofA should say \"suck it\" to Blago and go about their business. He's an impotent jerk.
![\"user-pic\"](\"http://consumerist.com/assets_c/userpics/userpic-185231-100x100.png\")
@QueridaNemo: Let's see...the governor and Obama have in common that they are Democrats from Illinois and ran on a change & reform platform. Therefore, they are the same?
I'm not even counting the Rezko thing, because that's just so old and beaten, it's embarassing.
![\"user-pic\"](\"http://consumerist.com/assets_c/userpics/userpic-384699-100x100.png\")
@QueridaNemo: Your \"typo\" removed all sense of respect I could have had for anything you ever say ever.
Brilliant. The government telling banks who to lend to was NOT AT ALL the cause of the current meltdown.
Let's fast-forward six months and read the story about Republic going bankrupt on accusations of corruption and bad books.
I bet BoA will provide a line of credit again with Blagojevich co-signed. If BoA won't extend their credit shouldn't Republic Windows & Doors get it from other bank.
Possibly a stupid question but isn't there also a big chunk about this story a piece about how the company has basically re-branded and is moving to IOWA?
This was on [communityorganizer.wordpress.com]
So some of the principals of Republic Windows and Doors form a new company, Echo Windows LLC, and while laying off their Illinois workers are busy buying another company. Who financed THAT? I'll try to makes sense of all this, but it's coming in pretty fast. Meantime, here's another that includes this announcement, in Door and Window Manufacturer Magazine:
TRACO has announced the sale of its residential vinyl replacement division to Echo Windows LLC. Echo Windows will assume all TRACO residential vinyl manufacturing and sales operations, and will continue manufacturing TRACO's Sienna Series and Power Two composite vinyl/aluminum windows in the Red Oak, Iowa, facility, which was purchased as part of the agreement.
@aftercancer: Wow, I would definitely be interested in finding out who financed that, and how they qualified for that financing. Interesting.
@aftercancer: Now that is interesting. Now we're talking something objectionable. Still has nothing to do with BofA, but that's pretty slimy.
Ridiculous. Republic is clearly in trouble. It lays off workers and can't even pay them back pay without borrowing money? BofA decides they are a bad credit risk, perhaps they fear bankruptcy, and refuses to lend them money and this is somehow BofA's fault? I don't like BofA all that much but good for them for identifying a poor credit risk and refusing lending. They should have done this years ago...
I was in BoA a few weeks back to open a new account, there were no customers, and no one who worked there even looked at me. I promptly left and went to Chase, so far so good with them.
@tinmanx: This may surprise you, but most people use direct deposit, ATMs, and online banking. I don't even remember the last time I actually went to a branch.
BofA does not have a contract with the employees the employer does. If the government wants to go after the company to pay the employees then fine but BofA is trying to make a wise choice here. The bail outs were a bad idea. We got here because the government pretty much forced creditors to lend to people that couldn't pay back the loans to make things fair. Now the government wants BofA to do that same thing again. As stupid as the bail out was it is even more stupid to continue to do the things that got us here in the first place.
No. We got here because of an unregulated market of credit default swaps. Lehman Brothers doesn't write mortgages but they had their fingers all over this unregulated market. There was many times the amount of money invested in that than all of the outstanding mortgages in the country combined. *That* was the real problem. You might be able to make a case that the subprime mortgages caused this market to go belly up but without this market we are in MUCH better shape than we are now.
How many people here love paying social security tax knowing that you will never see it again?
That is just what you want BofA to do is just throw away money and know they will never see it again.
Here's something I found interesting. This company was partially bought by JP Morgan Chase in Feb 07. [www.google.com] . So really Bank of America OWNS part of this company. Would that factor into providing them money if they had a minority interest in the company? Does the bailout apply to companies the banks own?
@Git Em SteveDave loves this guy->★:
Um, BoA and JPM are two entirely different companies. That's sort of like saying that GM owns a piece of them, so Toyota's liable.
@Git Em SteveDave loves this guy->★: BTW, I found that press relase after I pulled a cached copy of their website up on Google, and saw it listed under press releases, and did a seperate search. [209.85.173.132]
The bottom line is these workers need to be paid and I am glad that finally someone is standing up for themselves instead of taking yet another assreaming.
This company obviously has some assets left in the state, a building and contents, possibly product. The state needs to seize that to hold to pay the workers. They also need to pursue this slight of hand that they may have reemerged as another company in Iowa and if true start seizing assets there.
BoA owes us. We bailed their greedy short sighted behinds out. It looks like the state and the bankruptcy court could do something to assure BoA gets paid back if nothing with the sale of existing assets.
If the banks are not going to use that money for the intended purposes we need to demand it all back right now and use it for jobs programs and mortgage rewrites.
@bohemian: Ya, BoA should totally pay for workers they didn't hire. Let's expand this idea. How about you buy me a car. I totally have no affiliation to you so I meet your criteria.
![\"user-pic\"](\"/mt-static/support/assets_c/userpics/userpic-71417-100x100.png\")
Has anyone considered that Republic Windows & Doors owes millions already to BoA and it would be foolish for BoA to loan them anymore money? It's common sense. Banks are going under because of bad loans but Illinois want's BoA to make a bad loan anyway just to keep Republic in business? I think not. Unfortunately, I'm with BoA on this one.
just wondering.. why does this site and it's commenters always refer to Bank of America as BoA when they refer to themselves as BofA?
@KeeganGwar: Because it makes no sense to only abbreviate two of the three words. Plus BofA just looks and sounds stupid.
Scumbag Republic Windows refuses to pay their employees and BOA is punished?
Howabout seizing the personal property of those overpaid Republic Execs and paying the employees out of the proceeds. Of course the annual bonus should be seized as well.
![\"user-pic\"](\"http://consumerist.com/assets_c/userpics/userpic-605077-100x100.png\")
Don't fall for this story. This is not cumuppance for banks. Blagojevich is a notorious grandstander who tries to ingratiate himself with everyone with a sad story. Old people - give them free train and subway passes. Children - give them all free healthcare. A church burns down - give the church a million dollars (despite church state concerns) and disregard the fact the money eventually is stolen. Blago is corrupt, the feds have investigated him for years (including taping his conversations), his fundraiser Rezko is doing time for pay to play, and his wife's sole earnings come from getting commissions for being the assistant realtor on sales of real estate for politically connected donors. Blago came out today and said he always obeys the law. Hmm, I suppose the millions he's spent on his own lawyers has convinced him of that. Blago uses these photo-ops to make it look like he's for the little guy, but he his whole mode of operation is to appear to care, while taking political donations and then giving those donors state contracts, while getting a little piece for himself in supposed legal transactions.
I am not a fan of BOA either, but in this case, nearly all of you are wrong. BOA was one of several banks that stated that they did not need the govt. bailout money (Wells Fargo was another) and tried to refuse receiving it. Paulson made it mandatory for the nine largest financial institutions in America to take 25 Billion. BOA in this instance is the only party acting responsibly by denying to extend additional credit to an already insolvent company, regardless of what the money was for. IMHO, BOA should extend their mighty middle finger to the State of Illinois, pack the 25 Billion in $100 bills in a fleet of helicopters, fly over the state releasing the bills as they go. They will have about the same chance of getting that money back as they would giving out credit they way a number of you (and apparently everyone in the state govt.) think they should. When confronted on their shenanigans, they could simply state that they reeeaallly loosened up their credit.
Yay! My hard earned tax dollars at work! Isn't this country great? Where else in the world can you go start a company, make millions, screw it up and bone your workers, and then run to the government for more money to lather rinse, and repeat?
God bless America!!
The Governor should step up and personally guarantee the loan. If he won't, he should STFU.
How is this BofA problem? the real bad guys are Republic Windows & Doors. Just think about it would you lend someone money who could not pay you back? As much as BofA is a bad guy I'm with them on this one.
![\"user-pic\"](\"http://consumerist.com/assets_c/userpics/userpic-366802-100x100.png\")
I am not fan of BoA but this is ridiculous. Forcing a bank to lend money to a company that can't pay it back? Stupidity in government is the greatest threat to us all.
Have the state seize the plant, contents and product. Give it to the employees in lieu of their missing pay. The employees can either sell it or run it themselves, maybe BoA will extend them a line of credit to get it started back up.
I thought unpaid salaries were the first thing in line in a corporate bankruptcy.
Err... not sure what to think about this.
You've got a business which can't even afford to play its employees? Doesn't sound like a very good financial risk to me...
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This year's \"worst company in America\" is going to be one hell of a contest.
I still can't figure out why the govt. is insisting on all this oversight for the Big 3's measly $15 billion when the banks got many, MANY times that amount and can do whatever the hell they want with it!
@morganlh85: Guess what. BoA didn't want it. Paulson forced them to accept it and the strings that were attached.
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Lend $$$ to a company that has no way of paying it back dammit. I love this country. Wait that's Barracks turf. Barrack's gonna put the whammy on B of A. Tools for industry.
Banks are in the business of lending money. That's how they make money. They don't make money sitting on the cash. The bank was forced to take federal money and is forced to pay interest on it. So why would they not use it?
Perhaps this company is NOT credit worthy? So if the bank is forced to lend to a non-credit worthy company, who gets screwed when the company goes bankrupt?
You, as a taxpayer and as an implicit investor in all major banks get screwed. Republic Windows walks away.
Hopefully you're starting to think about this.
Oh, and wasn't a big reason why we're in this economic mess was because banks were lending money to people who couldn't afford to pay it back? Haven't we LEARNED ANYTHING?
Most of the large banks that received some of the bailout did not want it. The executves told Paulson to his face hey didn't want anything, but they couldn't stop him from buying public shares.
If I default on my BofA credit card and they close my account should I expect them to reopen it and up my credit limit so I can buy gas or food? No. Just like with the mortgage meltdown. Everyone is quick to blame the large corporations, but no one wants to look in the mirror.
Last time I check. There is more than one bank in Illinois. If the company couldn't get credit from BofA shouldn't they try getting it somewhere else? Just because BofA gave them credit once didn't mean they are required to give them credit forever. I think the governor is just picking on a easy target \"the big bad company\". Hey, I dislike BofA as much as a lot of people but forcing BofA to make unbusiness decision is just plain wrong.
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CNN: A law enforcement official says Illinois Gov. Rod Blagojevich is in federal custody on corruption charges.
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@crevers: The bad thing about this development is that if turns out that BoA were just being tightwads and this really was a smart move for Gov. Blagojevich to make... that truth is never going to be known now. In light of his probable corruption, this is going to look like either A) retaliation against BoA, because he may have wanted a spot on their corporate board and they didn't give it to him, or B) a favor he's doing for Republic, possibly in exchange for some kind of kickback.
Either that, or BoA sent the FBI after him as retaliation for his refusal to do business with them. But if BoA has that much power over the FBI, SHOOT ME NOW.
@crevers: Alas, it looks like this was one last feeble attempt by Governor BlownDry to try to draw attention away from his legal troubles.
When the chips are down, espouse Populism!
You beat me too it :(
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I doubt Rod's going to have much influence on BoA now that he's been arrested.
He has been arrested for trying to sell Barrack Obama's Senate seat and various other fun stuff
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Wait a minute. We're in this huge financial mess because banks knowingly took bad risks in making loans. Now BoA has learnt its lesson, it doesn't want to lend money to this company--which can only because they think it's risky or unprofitable to do so, right?--and the governor wants to force them to? Attention banks: act irresponsibly or else! PS don't worry, the taxpayers will bail you out.
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Governor Rod Blagojevich et al just indicted by the feds.
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Not the kind of governmental regulation that is going to drive this economy forward. They shoulda been regulating the COMPANY better so that it wouldn't get in the position that it's so UNLIQUID that it can't even pay its own employees. Hey, I have employees. Know what'd happen if I stopped paying them? They'd quit to find work elsewhere, that's what; and I'd be outta business. Why help out this ONE company and NOT ME, NOT YOU, NOT THE LITTLE PEOPLE?? Something tells me there are some bedfellows in this company and the state legislature, something tells me THIS IS SO!!
Yeah...too bad the governor has been arrested for trying to sell Obama's senate seat.
Just remember folks, you're assuming you know the whole story but you don't. You have no idea whether or not the window company is a good credit risk or not. BofA has no trouble giving credit to solvent companies. It's perfectly acceptable for them to look at the company's books and decide that they're not a good risk. This is business, people, not a love affair.
The free market system works just fine as long as artificially introduced changes to that market don't occur such as strong-arming lenders into giving home loans to people who could never afford them lest they be labeled a racist company. Altruism is never a good reason for making a bad business decision.
Oh and somebody tell me where were all the pro-bailout people when the dot com bubble burst? Congress was perfectly willing to let all those companies go away. And yes, many of them made as good quality a product as Ford, GM, & Chrylser (sarcasm intended). Lots of people lost fortunes and later got screwed again with the AMT. Nobody in Congress said that the AMT should be renegotiated or put on moratorium until the industry gets back on its feet.
@RogueWarrior65: Because when banks fail they take other companies with them. When worthless internet companies that don't actually produce anything fail they die alone.
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The business (Republic Windows & Doors) has not said anything about this that I can tell - other then telling their employees that they blame BoA.
I'm still wondering if there is more that Republic Windows & Doors has not said - and just blamed BoA as an excuse they told their workers... and now that it has blown up to a major story..... it will be interesting.
@coan_net: Yeah, what if the factory stopped paying their bill or something? BoA can't say why they closed the line of credit. It could be for any number of reasons.
@coan_net: As I understand it, the factory will be closing regardless, but BoA has shut down the company's line of credit preventing Republic from paying out severence and vacation pay and cancelling their health insurance.