Introduction
ABC Credit Finance is a regional credit card company with different payment processing outlets. As the executive of one of the offices above, I am confronted with various ethical and legal dilemmas as a result of the cooperation’s recent policy amendments. The firm has applied several adjustments to shorten billing cycles, enhance delayed payment fines, quarterly evaluate existing client interest rates and credit ratings, and encourage early reporting of late payments to credit bureaus.
Furthermore, the corporation has a questionable policy of delaying the settlement of early payments until after their respective deadlines and imposing late penalties. These alterations have spurred on questions that must be carefully considered to guarantee the firm’s conformity with the legal system and ethical commitments. Therefore, a breakdown of the regulatory provisions applicable to ABC’s practices, the ethical theory displayed, and my decision as the manager and at-will employee regarding the fifth policy form the basis of this paper.
Legal and Regulatory Provisions
The Truth in Lending Act (TILA), the Fair Credit Reporting Act (FCRA), the Electronic Fund Transfer Act (EFTA), and state consumer protection regulations are some of the legal provisions that bind credit card firms. These laws and standards protect customers while ensuring that online payment businesses operate fairly and transparently (Estlund, 2022). As such, ABC Credit Finance, being a credit card issuer, is governed by these rules, and its transaction processes have to be scrutinized under the forecited conventions.
Credit card firms are required by the Truth in Lending Act to publicize the terms associated with their operations, especially regarding interest rates and charges. Under TILA, ABC’s new policies, particularly the fourth one, which involves a preemptive assessment of current customers’ interest rates against their credit rating, should be reviewed. This is because all credit card corporations must clarify the criteria used to set interest rates, and any variations in interest-related aspects must be revealed to their clients on time.
Concomitantly, the Fair Credit Reporting Act guarantees consumer credit data transparency, such as delayed payments and reporting. ABC’s policy adjustment number three, which requires the prompt notification of overdue payments to reporting firms, can be reviewed under the FCRA. The statute mandates credit card providers to disclose correct information to credit reporting organizations and to examine all complaints from clients (Kim et al., 2020). ABC risks facing lawsuits or fines if it violates its obligations with the FCRA.
Concerning electronic fund transfers, the Electronic Fund Transfer Act specifies customers’ and financial institutions’ rights and obligations. The second policy modification made by ABC, which shortens the billing period, might fall under EFTA review. According to the law, credit card firms must provide clients with sufficient time to settle their payments and notify them in advance in case of any amendments to the billing cycle.
Moreover, credit card firms may be subject to stricter regulations under state consumer protection legislation. For instance, certain states could demand that these corporations grant customers a grace period before imposing late penalties or that they give users advance notice before altering their account conditions. Apart from TILA, other state and federal laws that defend consumers from unlawful and misleading activities may potentially scrutinize ABC’s policy modifications. For example, the Dodd-Frank Wall Street Reform and Consumer Protection Act forbids unreasonable, fraudulent, or coercive practices in providing consumer financial goods or services (Tanwar et al., 2019). It is important to note that DFWSRCPA falls under the Consumer Financial Protection Bureau.
If these regulations are infringed due to ABC’s policy changes, there may be serious financial and legal repercussions against the company. At the same time, the corporation can be forced to pay penalties, compensation, or reparations to the affected clients (Zulni & Achiria, 2020). As such, it is my duty as an employee at ABC to raise any concerns regarding conceivable legal or ethical infractions to my supervisors or the authorized regulatory institutions.
Concurrently, ABC should be aware that its new policies could have long-term effects on consumer loyalty and trust. Clients who believe they have been unjustly treated or deceived by the business may be more prone to switch to other card payment service providers. This move might eventually undermine the firm’s bottom line (Zulni & Achiria, 2020). As part of the company’s management, I would advise ABC to reflect deeply on the possible effects of its policy changes and put all stakeholders’ interests, such as clients, staff members, and the larger community at the forefront.
Conclusively, four main legal provisions apply to ABC Credit Finance’s payment processing procedures: TILA, FCRA, EFTA, and state consumer protection legislation. Under these rules, ABC’s policy changes can be reviewed and scrutinized to assess the firm’s compliance with ethical norms. Therefore, the business must adhere to such conventions to avert possible penalties or lawsuits. As an issuer of credit cards, ABC must act justly and safeguard the interests of its clients. The section below summarizes the most relevant ethical conjecture that applies to ABC’s new policies.
Ethical Theory
According to the consequentialist ethical theory of utilitarianism, a decision is morally correct if it results in the greatest possible benefit for the majority of the population. On the other hand, ethical obligations mandate that companies should consider both their interests and those of third parties, such as customers and shareholders when formulating new policies. The company’s rules in the case of ABC’s payment processing procedures seem to prioritize its profitability interests over the needs of its clients.
Although the corporation may profit from policy changes, many clients may suffer, especially those with unfavorable credit ratings. The main objection of utilitarianism is that it allows for the justification of unethical or reprehensible policies if their outcomes benefit everyone(Kim et al., 2020). In this context, ABC’s new payment processes may accrue financial benefits to the firm. However, the business’s policies may be deemed dishonest and unethical because they affect its consumers, who represent the majority.
ABC’s policy decisions may have far-reaching effects on its clients. Low-income earners, for instance, may face greater penalties and interest charges as a result of policy changes that shorten the grace period for late payments. This might also have a negative influence on their credit ratings, making it more difficult for them to secure subsequent loans (Zulni & Achiria,2020). Furthermore, the new policy that withdraws the opportunity for users to question processing fees may result in clients being charged for unapproved or inaccurate payments, inflicting them with significant financial losses.
Adopting a more honest framework for its payment processing procedures, on the other hand, would necessitate ABC to prioritize the interests and the satisfaction of its customers in addition to its financial objectives. This might include introducing rules that uphold openness and integrity, such as brief disclosure of interest and fee rates, extended grace periods for overdue payments, and streamlined dispute resolution mechanisms. Ultimately, utilitarianism and consequentialism theories can serve as suitable models for assessing the ethical aspects of ABC’s payment processes.
Nonetheless, while making ethical judgments, it is critical to acknowledge the shortcomings of these ideologies and reflect on the interests of all stakeholders. A more ethical framework in this context would need the corporation to balance its financial interests with the well-being of its clients to attain the best overall benefit for all relevant entities. The section that follows presents my opinion as a manager regarding the execution of ABC’s fifth policy.
Implementation of Policy No. 5
As a manager, I would not implement policy number five as it does not adhere to all relevant statutes and rules in card processing. Ethical business operations involve taking our customers’ welfare into account and using fair policies and procedures. The amendments in ABC’s guidelines, notably the fifth one, could put us in violation of the Truth in Lending Act, which mandates credit card firms to publicize all credit account rules, including fees and interest rates. The policy may also be subject to scrutiny under the Fair Credit Reporting Act, which governs the integrity, objectivity, and confidentiality of consumer credit information, including the reporting of delayed payments.
Furthermore, as a utilitarian, I must assess the policy’s impact on all parties and not overstate the business’s key objective of remaining profitable. While policy number five may help ABC financially, but it can affect our clients currently in financial distress. As such, I must consider the possible implications of executing the policy against the potential repercussions of not enforcing it. If I choose not to apply the fifth guideline, I would raise my reservations to the relevant authorities or discuss the ethicality of the situation within the organization to find suitable alternatives. The segment below highlights two main options that I can consider to protect my career as an at-will employee.
Protecting My Job as an At-Will Employee
I know that as an at-will employee, my employer may rescind my position at any time and for any cause, provided that it is not motivated by discrimination or retaliation. This implies that my employability is not assured, and my manager is not obligated to justify the termination of my job at the company. Nonetheless, as an at-will employee, I have several supporting rights stipulated under federal law, such as protection against unfair dismissal.
Firstly, if I choose not to execute the fifth policy and am fired or retaliated, I can leverage the legal recourse available to me. For instance, I have the right to submit a grievance to the relevant entities, such as the Equal Employment Opportunity Commission or the Department of Labor (DOL) (Henry et al., 2020). This move will be very effective, especially if my dismissal was as a result of discrimination or a breach of labor standards. For instance, if the manager fires me based on my gender, ethnicity, nationality, or religious affiliations, the DOL will deem such termination as discriminatory and unlawful.
Secondly, as an at-will employee, I must take preventive measures to safeguard myself and my job entitlements. This can be done by establishing my dissent to policy changes and presenting my ethical or legal concerns to my managers and colleagues. Concurrently, I can report the questionable policy reforms and retain all proof that supports a claim of unfair dismissal. The retained evidence may be required in any legal actions arising from my dismissal or retaliation. Analogously, a claim for wrongful discharge cannot be made merely because a worker disagrees with policy changes.
Nonetheless, I may have legal options if I face retaliation or termination for refusing to adopt a policy that I consider to be unlawful, unprofessional, or unfair. I can also consult an employment law professional to help defend myself. The law attorney can inform me of possible alternatives and, if required, assist me in filing a lawsuit against ABC Finance.
Lastly, I have access to legal provisions and many consulting firms that can offer aid and resources to workers who are the targets of unfair dismissal or retribution. These firms include unions, NGOs focusing on civil rights, and employee advocacy groups. These organizations may provide direction and advice during legal procedures, networking possibilities and assistance with my job-searching endeavors. From a jurisprudential stance, taking action against someone for disclosing unethical or illegal conduct and policies is unlawful. Therefore, if I decline to enforce the fifth policy and get suspended, intimidated, or fired, I can use the grounds above when imposing a wrongful termination charge against the company, as discussed below.
The Basis for Wrongful Discharge Action Against ABC
As highlighted in the section above, I can sue ABC for wrongful termination in case I am dismissed for failing to adopt the fifth guideline. Wrongful termination occurs when an employer dismisses an employee in contravention of a public policy, a signed agreement, or other civil liberties. The policy change, under this circumstance, infringes TILA, FCRA, EFTA, and state laws about consumer protection. Furthermore, my reluctance to execute the policy is justifiable under the National Whistleblower Statutes (Werhane & Radin, 2019). To file a wrongful dismissal lawsuit, I would have to prove that I was fired in violation of these laws and rules. This may necessitate legal counsel and a full grasp of the relevant regulations.
In summary, as a manager at ABC, I need to deliberately reflect on all the ethical repercussions linked to the modifications of the payment processing policy, especially the fifth one. At the same time, I am obliged to ensure that ABC complies with all relevant legislation and that it takes into account the interests of all parties involved, including clients and shareholders (Byskov, 2020). If I fail to adopt the policy and get fired, I can use legal grounds and whistleblower statutes to defend my position and hold ABC Finance responsible for its unethicality.
Conclusion
The most recent policy modifications made by ABC Finance present several moral and legal concerns, especially regarding policy number five, which is a disputable, unlawful, and unethical rule. Managers must ensure that payment processing procedures are honest, open, and compliant with all relevant regulations and legislation. Similarly, workers are morally responsible for rejecting and criticizing unethical policies and denouncing them to the relevant entities on time. As an at-will worker, I may have few alternatives for protection against dismissal. Nonetheless, federal and state laws exist to safeguard me from being fired in retaliation for exposing unethical or unlawful conduct or submitting whistleblower reports.
References
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