JPMorgan Chase settles California debt collection practice suit
California's Attorney General Kamala D. Harris has announced a stipulated judgment resolving claims that JPMorgan Chase (Chase) committed credit card debt-collection abuses against tens of thousands of Californians. The settlement specifically addresses debt collection wrongdoing that includes collecting incorrect amounts, selling bad credit card debt, and running a debt collection mill that involved illegally "robo-signing" thousands of court documents and improperly obtaining default judgments against military servicemembers. Chase will pay $50 million in restitution to borrowers nationwide (including an estimated $10 million to California consumers), plus significant restitution to servicemembers in California. Some of those servicemembers are alleged to have been on active duty when Chase obtained illegal default judgments against them. An additional $50 million in penalties and other payments will be due to the state of California.
In July, Chase was ordered to pay the OCC a civil money penalty of $30 million, and over $136 million in penalties to the CFPB and other states, plus millions of dollars in refunds to affected consumers in related actions. See our July 9 Top Story for more information.