April 19, 2000

Boston Bank's Customers Storm Meeting to Protest New Rates

By Lynn Arditi

About 100 demonstrators brandishing signs and bullhorns descended on FleetBoston Financial's annual meeting at the World Trade Center yesterday and loudly protested new bank fees in Massachusetts they say will cost consumers more money.

The demonstrators, led by the Boston-based nonprofit group, Neighborhood Assistance Corp. of America, crammed a hallway and demanded to be let into the auditorium where bank executives were making a presentation to several hundred shareholders.

At one point, a brief shoving match broke out and some demontrators tried to push past a phalanx of security guards and state troopers. In the midst of the scuffle was Bruce Marks, NACA's fiesty executive director, who said he and other protesters were legally entitled to attend the meeting because his organization owns shares in FleetBoston.

But when it became clear the group would not be allowed to enter, the protesters backed off, and instead began chanting "we're fed up with Fleet fees!"

After a standoff of more than an hour with security officials, the group marched, chanting, out of the building. They said they planned to stage more protests throughout the afternoon at FleetBoston branches around Boston.

The bank said later that Marks and the other protesters didn't have the proper identification to be admitted. The bank, however, offered to let two members come in to represent the group, but Marks declined, said FleetBoston spokesman James Mahoney.

No injuries or arrests were reported.

The demonstration attracted a crowd of media and onlookers who watched the scene from the second-floor balcony. The protesters failed to disrupt the annual shareholders' meeting but they succeeded in grabbing attention from FleetBoston's announcement of a $ 2 billion stock buy-back plan -- representing about 57 million shares or 6 percent of the bank's total stock -- aimed at boosting the bank's stock price.

Yesterday's demonstration was ostensibly sparked by FleetBoston's latest fee plan, mailed to customers several months ago, that is scheduled to take effect in Massachusetts on June 12.

It's uncertain whether the new fees in Massachusetts, initially described yesterday as corporatewide, will be the same for Rhode Island.

FleetBoston, new England's biggest bank, has not announced its new fee schedule for Rhode Island and Connecticut, and "it remains to be seen whether there will be different prices for (those) states," said Bruce Spitzer, a FleetBoston spokesman.

This latest round of new fees is timed to coincide with the bank's integration this summer of customers from BankBoston and Fleet into the newly merged FleetBoston system.

Bank officials told reporters after the meeting that the new fees in Massachusetts will mean the same or lower prices for most customers.

Fifty-two percent of all customers will pay the same amount in fees, and another 13 percent will pay less, said Robert B. Hedges Jr., managing director for retail distribution at FleetBoston.

The remaining 35 percent of FleetBoston customers will see a "modest increase" -- on average, 71 cents more per month -- in their bank fees, Hedges said.

"Although there's been a lot of attention drawn to Fleet's fees today, we stack up rather consistently with the other competitors in the marketplace," said FleetBoston's Spitzer.

A bank-fee chart FleetBoston provided to The Providence Journal lists several types of fees -- which included debit-card charges, Internet banking, and bounced checks. Those three FleetBoston fees are the same or lower than Providence-based Citizens Financial Group and Boston-based Sovereign Bank New England.

Yesterday's protests came as no surprise to bank officials, who were tipped off by fliers circulating around Boston on Friday. Security was tighter than usual, with state troopers milling around the hallways and a security detail that included more than a dozen men and women in suits and ear wires, some of them studying sheets with floor plans of the building.

People authorized to enter the annual meeting were given color-coded circle stickers for easy identification.

Estimates of the number of protestors varied, from more than 50 to 150, according to authorities.

FleetBoston officials yesterday questioned why Marks -- who launched his activist career in the mid-1990s by attacking Fleet for predatory mortgage lending and later expanded to other banks around the country -- was now taking up the issue of bank fees.

In 1994, FleetBoston signed a watershed deal with Marks' group to disburse about $ 140 million in mortgages for low-income people. Marks went on to sign similar deals with other banks, including a $ 3-billion deal last year with Charlotte, N.C.-based Bank of America.

Marks has gained national attention for his self-described guerrilla tactics against banks.

"This is a tactic to get another agreement," said Eugene McQuade, chief financial officer for FleetBoston. NACA's lending program with FleetBoston has expired, he said.

"We don't need Fleet's mortgage money," Marks responded.

Bank fees have always been an important issue to NACA, Marks said, pointing to his testimony to the Federal Reserve Board about the Fleet-BankBoston merger. "When you read our testimony," he said, "the major issue we talked about is fees."

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