When I was foolish enough to attend law school (economically, a poor gamble regardless of the propaganda, but that's a topic for another time) I got a couple of loans to cover tuition. In due course, they came into the hands of a company called AEG: a small loan, costing me roughly $200 a month, and a big loan, roughly $300 a month.
In the spring of 2008 it became patently clear that our economy was in big trouble, and the money I'd saved for retirement wasn't going to do well in the stock market. At the same time, I was pissing away over $500 paying those loans, at let us say 6%.
I figured it'd be worth pulling money from my retirement funds to pay off one of those loans. Although there are big penalties for early withdrawal, the effective 6% return (in round numbers ... the actual return is even better...) is more than the market was going to deliver, and of course there's the matter of conserving the principle.
I had a couple of long conversations with AEG on how to pay off the smaller loan (roughly $9700). They advised me that I couldn't use their electronic system since it would put the money wherever they wanted (obvious code for "not gonna let you pay off the small loan; we want the full $500 every month!")
Instead, AEG told me, I could mail in a check with a cover letter saying thus-and-so. "How much should the check be?" I asked. "Well, you can't send in the amount that the loan is now, because interest will accrue while the check is in the mail," AEG replied, "Send in (some amount over $9700) and we'll refund any overage, eventually". So I did.
And I relaxed. I took a big hit for the withdrawal, but I'm effectively making over $200 a month on roughly $9700 which in this economy is not bad!
AEG cashed the check on June 13, 2008. And ... funny thing: they kept withdrawing for both loans!
I let it pass the 1st month. I figured it was a computer error, or something about the timing of the checks, whatever; surely their eagle-eyed accountants will spot the problem and fix it.
Months go by. I was foolish enough not to look over my credit union statements carefully. Finally I notice they took a payment in OCTOBER. That's FOUR payments, over $800 to which they are not entitled. I call them.
First, AEG tells me they're still debiting my account because I'd sent in only $6000. Heh! No sale!, I say; try again.
Next, they tell me I need to speak to someone else. OK, the cellphone is fully charged, I'll wait some more.
Then, a guy comes on and tells me that, yes, the money went into the wrong account. He assures me they'll fix it, but his supervisor is at lunch and the process will take some investigation. (I do believe this is possible; people still go to lunch; it's one of the few human moments organizations allow their thralls.) Anyway, the AEG guy tells me that I need to send them a fax. Like, everyone has a fax machine sitting around their house because, you know, it's the 21st century and we're all George Jetson.
So AEG suggests an email telling them to stop debiting my account, but I should follow up with a fax when I find a machine. (For me, a followup fax is not a problem; our apartment building management lets us fax out, which is nice & handy. But I can imagine a lot of graduates have to pay a Kinko's or something because, you know, Paper is God and Fax is its Prophet.)
I'm happy that AEG will consider stopping taking money (to which it is not entitled) out of my account, but I sorta want my money back from the four payments to which it was not entitled. When will that happen?
Well, says AEG, I should call back next week. They're pretty busy today because Columbus Day was a holiday. I definitely believe that last part; four-day weeks in most organizations are simply periods of time in which you have to do five days of work to make off for your Extra Day of Rest. It's sort of a Bob Cratchett thing.
And, says AEG, they may require some proof in the form of bank statements. This amuses me. Somehow I'm supposed to prove that they have money that came from my credit union; are they so incompetent they don't know where they are getting money from?
So here we sit: they have my money, and I have to pray for it. My credit union balance is screwed up, and AEG won't give it back until I do a bunch of work for them.
It is possible that AEG screwed up through pure error, with no malice involved. But is it likely? Their error profited them; if they similarly screw everyone who tried to pay off a loan, it would definitely be worth their while. It's also kind of hard to figure out what KIND of error could have produced this result; the loans are different accounts; the check was accompanied by a note worded as AEG specified. Am I supposed to believe that they just incompetently took the money in the only way that would maximally benefit them?
Organizations can be malicious (...I won't say "criminal" because that has difficult technical meanings ...) in many ways. The classic way is for a bad individuals to perform malicious acts; this is relatively easily detected, and the bad guy can be identified and punished in an emotionally satisfying way.
However, this is far from the only or even the most common type of corporate malice. Malicious procedures develop in organizations because of the nature of organizations, and it is difficult for us to perceive the malice, just as it's difficult for a cell of the body to perceive the workings of the body as a whole. We simply accept that that's the way things work, and suffer the consequences.
But, back to today's issue: which would be worse:
That AEG is incompetent?
Or that AEG is malevolent?
"As through this life you travel, you meet some funny men
Some rob you with a six-gun, some with a fountain pen
As through this life you ramble, as through this life you roam
You'll never see an outlaw take a family from their home"