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Monday, March 1, 2010

Mad as Hell: Los Angeles City Government Could Move Investments out of Large Banks

Chase, Other Bigs Fear Losing City's Multi-billion-dollar Portfolio

Los Angeles City Councilman Richard Alarcón recently ordered the city's legislative analyst to create a points system for grading the social responsibility of financial institutions that want to handle the city’s investment portfolio.

But Councilman Alarcón didn't stop there. He also said the city should, as Arianna Huffington has said both on her online newspaper, "The Huffington Post" and on network television, "Move Your Money." The "Your" in this case means the taxpayers of the City of Angels. The move would, presumably, be from big banks such as BofA and Chase to smaller community banks and perhaps even credit unions.
Alarcón proposed that the city create a “report card” to evaluate the number of small business loans provided, evidence of working with homeowners facing foreclosure, the number and location of branches and ATMs and the use of federal TARP funds.

“During these times of the financial meltdown and the federal bailout of big banks, it is more important than ever that we ensure that our money is being invested in institutions that are investing back in our community—not those that are taking advantage of our residents and ripping off their clients,” said Alarcón, whose district is in the northern part of the San Fernando Valley.

“Creating investment criteria will help us ensure the city is investing taxpayer money responsibly and making the most out of our multi-billion dollar portfolio.”
After a hearing on the city’s investment practices, Alarcón, who is chairman of the Jobs and Business Development Committee, led a contingent of union members, staff, members of the public, and media to the downtown offices of Chase Bank. Inside the bank’s lobby, the group delivered a letter demanding the bank act more responsively to the needs of the community.

Pictured above: L.A. City Councilman Richard Alarcón (second from left) and an unnamed woman ask a bank employee at Chase Bank near City Hall to help get a letter of demands to Chase's Wall Street headquarters.

Below: A draft of the councilman's proposed report card for banks who want to handle L.A.'s investments:

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