[Congressional Record Volume 147, Number 85 (Tuesday, June 19, 2001)]
[Extensions of Remarks]
[Pages E1146-E1147]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




      ROCHESTER INSTITUTE OF TECHNOLOGY HONORS PROVIDIAN FINANCIAL

                                 ______
                                 

                          HON. JOHN J. LaFALCE

                              of new york

                    in the house of representatives

                         Tuesday, June 19, 2001

  Mr. LaFALCE. Mr. Speaker, I have addressed the House on numerous 
occasions in recent years as a critic of the credit card industry and 
its marketing practices. Today, I would like to share with my 
colleagues a different story, of how two very different institutions 
have joined to recognize not only a significant business turnaround, 
but a change in practices that have enormous consequence for consumers.
  One of these institutions is the Rochester Institute of Technology in 
Rochester, New York, one of the world's outstanding centers of learning 
in the areas of business and technology. It is also located in Monroe 
County, one of the four counties I have the honor of representing. The 
other is Providian Financial Corporation, a financial services company 
and a major national issuer of credit cards based in San Francisco, 
California.
  Earlier this month, the Rochester Institute of Technology joined with 
USA Today in awarding Providian the 2001 Quality Cup award for 
achievement in customer service. The award recognized Providian for the 
enhanced customer satisfaction program initiated by the company in May 
1999 to address consumer complaints and litigation. Under this program, 
Providian has implemented more than 200 initiatives in the areas of 
customer outreach and communications, complaint processing, customer 
service and marketing practices. The results have provided a dramatic 
turnaround for the credit company. Since 1999, Providian's customer 
accounts have increased 60 percent and its assets have grown by 78 
percent. At the same time, consumer complaints have declined 40 percent 
and customer attrition rates have dropped 38 percent.
  The Quality Cup award was instituted by the Rochester Institute and 
USA Today in 1991 to recognize and foster quality in American business. 
It has been awarded annually to businesses, government and educational 
institutions, and health care organizations who use teamwork and total 
quality management to reduce costs, solve problems, increase 
productivity and enhance consumer service. This year, a judging panel 
consisting of Rochester Institute faculty, together with outside 
academics, industry consultants and quality experts, considered 146 
nominees ranging from Fortune 500 corporations to small businesses. In 
addition to recognizing Providian in the customer service category, 
winners were also selected in the categories of government, health 
care, manufacturing and small business.
  The recognition of the Rochester Institute and USA Today symbolizes 
the dramatic changes Providian has achieved in less than two years. 
Until recently, the company was mired in controversy and litigation. 
Late last year, Providian agreed to pay $105 million to settle earlier 
class action litigation that alleged that Providian had routinely 
charged credit card accounts for products and services that consumers 
had not approved or authorized. The settlement was Providian's second 
within a year. In June, it also agreed to pay $300

[[Page E1147]]

million to settle an enforcement action by the Comptroller of the 
Currency involving marketing practices that the Comptroller described 
as a ``pattern of misconduct to mislead and deceive consumers.''
  Since implementing its customer satisfaction program in 1999 
Providian has completely restructured its consumer marketing and 
customer relations operations. Particularly impressive has been 
Providian's willingness to go beyond the minimal requirements in 
Federal law relating to consumer protection, both in providing 
consumers with large type, plain-English explanations of credit card 
terms, as well as providing additional protections for their customer's 
confidential financial and personal information.
  I want to congratulate Providian for the dramatic turnaround it has 
achieved and for its strong and growing commitment to customer 
satisfaction. I also wish to commend the Rochester Institute of 
Technology for its continuing efforts to recognize and promote 
excellence in business practices and consumer service.

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