BBB won’t shy away from taking a tough stand

In January 2004, the Better Business Bureau suspended the accreditation of Washington Mutual Bank. One of the standards it agreed to when it applied for BBB accreditation was that it’d be free from an unsatisfactory report at its headquarters. When this occurred at WaMu’s headquarters, WaMu lost its accreditation.

This is not the first time a local BBB-accredited business has felt the effect of its parent company’s activities.

At times, local affiliates can encourage effective change from above – for example, talking headquarters into resolving the unsatisfactory record to avoid a BBB revocation. And in a number of cases, we have seen this type of pressure from affiliates to their headquarters to take care of unanswered complaints and clear up their reports. That is how the system should work, and often it does.

Despite gallant efforts by the local WaMu affiliate, the change from above did not take place. The revocation of the BBB accreditation was almost five years ago. So why bring it up now? Because I think the BBB should have seen a red flag that it did not.

Complaints specific to WaMu’s mortgage division were handled by the California headquarters, while other WaMu complaints were handled locally or went to Seattle, depending on the location of the consumer’s transaction.

Both WaMu’s mortgage division report and the Seattle headquarters report reflected unanswered complaints, while our local WaMu report was satisfactory. Given that the BBB is in the resolution business, it needs both sides of the story. All the BBB asks a business for at this stage is an answer.

But the red flag goes a bit deeper. The report in California was also unsatisfactory due to a pattern of complaints. What was the pattern? Sales tactics in selling mortgages. Hmmm.

Now that we are well into the mortgage meltdown, we know what aggressive subprime loan sales did when housing values declined. Should we have seen more here? Did the board of directors of WaMu even know that its company’s BBB accreditation had been revoked and its report was unsatisfactory, or was this just the tip of the iceberg? We will never know, but it sure makes me question just how much the board of directors and customers know about a company’s reputation.

Take the now-famous Joe the Plumber. Come to find he is not licensed, despite the requirement to be so. Dig a bit deeper and you will see that the company being held up as a glowing example of the everyday contractor, Newell and Sons Plumbing of Toledo, Ohio, has an unsatisfactory BBB report. Fancy that.

While you will never find every skeleton in the closet, this is an example of how one can conduct some very simple research that could easily reveal what sort of ethical foundation a person or business is built upon.

We have issued a couple of attention-getting accreditation revocation announcements in the past few months in Eastern Washington. In one case, the BBB is being reprimanded by an industry group for holding the recently revoked business accountable.

I am not going to use this space to mention names. If I did, they would accuse me of misusing this space to benefit some agenda. I will not fall into that trap. What this behavior reveals is a need for the BBB to be even more vocal when it comes to breaches of ethics and standards. This will not win us popularity contests, but in a world where honesty and living up to promises are becoming rare, we have the obligation to the marketplace to hold everyone involved accountable. And that includes the outrageous customer demanding the moon.

My point is that perception is its own form of reality, and in the case of businesses, BBB reliability reports and reputation, all require a deeper look in these times when we question even more who and what we can trust.

You can trust your BBB to continue to be vocal about revocations and staunch about upholding the BBB standards of accountability. We may never be prom queen, but fulfilling the mission to continue to foster an ethical marketplace is just too important to worry about who likes us and who does not.

All BBB revocations and other regional news center alerts are posted to our Web site: www.bbb.org. Just do the research to empower your decision and vision. Start with trust.