Beneficial Finance was once a great company, so was HFC

I’m not sure what stuff this person refers to exactly, but today we received this opinion: “Beneficial was a great company to work for and great to customers until HFC merged with Beneficial and took charge and begin calling the shots. I was a manager for them 25 plus years. The stuff about Beneficial is a bunch of crap.”

We agree with the writer’s frustration. The following will show you why:

Household International bought Beneficial Finance back during the William F. Aldinger days. I personally remember when Beneficial and Household were great companies. $5000 loans, a coupon book, and payments were made at the originating branch office, or at any other branch. Both served a need, had friendly staff, and when you got to the last coupon in your payment book the loan was paid off. Those were the days.

In April 1998, Household said it agreed to buy Beneficial Corp. for about $8.25 billion in stock, a deal that would create one of the nation’s largest consumer finance and credit card companies. Aldinger had been in charge of Household International for four years at that time, joining the company in 1994.

Household International was sued by the State of California the same year that Household International bought Beneficial. Of particular interest in 1998, California’s Department of Corporations sued Household International to stop Household from charging excessive administrative fees after the company admitted to 36,000 instances in which it had violated state lending laws and regulations. Household agreed, but what actually happened was a shock to everyone.

In 2001 the state of California sued Household International again after discovering that “Not only did Household fail to comply in 1998, but it began practicing even more abusive lending procedures and passed these practices on to its sister corporation, Beneficial, Inc. As a result, many African-Americans, Latinos and economically disadvantaged Californians found themselves illegally nickeled and dimed by a $26 billion company.”