American Express Accused of Fraud, Again

According to the Wall Street Journal, a judge has warned American Express to stop misleading the court about its business practices in a class-action lawsuit that claims AMEX has purposely overcharged customers for travel insurance since 1983 (nearly a quarter century ago).

American Express is a typical credit card company that fundamentally operates according to the founding principles of the American Debtors Prison. One of those principles is the inviolable assumption that anyone who defaults on their debts for any reason must be committing fraud, and is therefore legitimately subject to aggressive collections terrorism and denial of bankruptcy protection from creditor harassment.

Yet the company itself is now accused on behalf of five million customers of committing fraud, and has been admonished by the court to cease deception in that same case.

Remember that whenever AMEX's collections terrorists harass customers who have lost their jobs, become seriously injured or ill, or temporarily have difficulty paying their bills because they are busy dodging bullets, bombs and beheadings while serving the military in Iraq.

Tip: Visit the highly-rated website AMEX Sucks if you are among the millions of people who have been burned by American Express.

All the best,
Paul

United Airlines Terminates Pensions in Bankruptcy

USA TODAY reports that a bankruptcy judge has approved United Airlines' request to terminate its pension plans, which will result in the largest corporate pension default in history. The federal Pension Benefit Guaranty Corporation will now be responsible for covering UAL's $645 million in pension payments. Although the PBGC claims that taxpayer dollars are not used for this purpose, the burden eventually makes its way back to American citizens via higher insurance premiums, etc.

Once again, in the wake of the bankruptcy "reform" bill that President Bush signed last month, a major U.S. Corporation is doing exactly what the banks and credit card companies claim is a plague unique to individuals customers: using bankruptcy as a "financial planning tool". The bankruptcy "reform" bill does nothing to stop this corporate abuse of the bankruptcy system.

And what does United Airlines CEO Glenn F. Tilton receive as compensation for piloting his airline straight into the ground? According to SEC documents, Mr. Tilton received the following compensation in 2004:

Salary: $756,832
Bonus: $366,393
Other Annual Compensation: $27,910
All Other Compensation: $8,481

According to my abacus, that totals $1,159,616 in annual compensation--including a $366,393 bonus--for leading his company into bankruptcy.

Fortunately, Mr. Tilton and the CEO's of other bankrupt airlines can blame high fuel prices for their failure--a convenient escape that is not available to ordinary working folks who default on credit cards and other bills in part because the cost of transportation to work has risen faster than the income they earn by working.

There's just one little problem with blaming high fuel prices for United Airlines' bankuptcy: Mr. Tilton's previous job was CEO of Texaco Oil, and before joining UAL he was interim Chairman of Dynegy Inc.--an energy company involved in the California energy crisis and Enron fiasco. Did he learn nothing at all while running oil and energy companies, or is he himself partially responsible for rising fuel prices that have enriched him as CEO of a bankrupt airline? Remember, corporate bankruptcies usually benefit the executives of the corporations that go bankrupt because corporations abuse the bankruptcy system as a "financial planning tool".

So where will all those hard-working, long-suffering United Airlines employees spend the twilight of their years on earth now that their pensions are in the competent hands of the U.S. government? For many, it will be the American Debtors Prison. The only good news for them is that they won't be sharing a cell with Glenn F. Tilton.

All the best,
Paul

One Of These Presidents Is Not Like The Others

"[avoid] likewise the accumulation of debt, not only by shunning occasions of expense, but by vigorous exertions in time of peace to discharge the debts, which unavoidable wars may have occasioned, not ungenerously throwing upon posterity the burden, which we ourselves ought to bear." -George Washington

"If the American people ever allow private banks to control the issue of currency, first by inflation, then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their fathers conquered." -Thomas Jefferson

"I see in the near future a crisis approaching that unnerves me and causes me to tremble for the safety of my country. . . . corporations have been enthroned and an era of corruption in high places will follow, and the money power of the country will endeavor to prolong its reign by working upon the prejudices of the people until all wealth is aggregated in a few hands and the Republic is destroyed." -Abraham Lincoln

"This new [bankruptcy "reform"] law will help make credit more affordable because when bankruptcy is less common, credit can be extended to more people at better rates." -George W. Bush


The bankruptcy "reform" bill Mr. Bush refers to, and recently signed, is a devastating attack on our Founding Fathers' goal of providing effective bankruptcy protection as a means of preserving citizens' freedom from debtors imprisonment, and for mandating an incentive for lenders to behave responsibly and conscionably. The bill was not written by elected officials. It was written by a coalition of credit card companies, banks, and automakers.

So Mr. Bush is encouraging U.S. citizens to accumulate debt (which he calls "credit"), is aiding the "money power" in establishing prejudice against their own constitutional right to bankruptcy protection, and by weakening both cash and bankruptcy protection he has helped private banks to issue currency in the form of "credit" (i.e., debt). Flooding an economy with phantom money ("credit") is a direct cause of inflation.

Meanwhile, the Bush administration continues to increase our national debt with out-of-control spending on a wholly avoidable war, with no intention of bearing that debt themselves, and every intention of "throwing upon posterity the burden" of this astronomical public debt.

All the best,
Paul