Exclusive: JPMorgan to pay over $125 million to settle U.S. credit card debt probes

Wed Jul 8, 2015 8:21am EDT
 
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

By Karen Freifeld

NEW YORK (Reuters) - JPMorgan Chase & Co (JPM.N: Quote) has agreed to pay at least $125 million to settle probes by U.S. state and federal authorities that the bank sought to improperly collect and sell consumer credit card debt, according to people familiar with the matter.

The settlement also includes about $50 million in restitution, the sources said.

The nation's largest bank has been accused of relying on robo-signing and other discredited methods of going after consumers for debts they may not have owed and for providing inaccurate information to debt buyers. Robo-signing refers to signing documents in mass quantities without reviewing records.

The U.S. Consumer Financial Protection Bureau (CFPB), 47 states and the District of Columbia are expected to announce the settlements as soon as Wednesday, the people said.

The states will split some $95 million, while the CFPB will get $30 million, the people said. JPMorgan Chase and the CFPB did not return calls for comment.

A spokesman for Iowa Attorney General Tom Miller, who has been leading a group of states in probing JPMorgan's debt sales and collection actions, declined to comment.

Mississippi and California are not expected to settle at the same time, sources said. Both have lawsuits pending against JPMorgan over debt collection practices.

California Attorney General Kamala Harris sued in 2013, claiming the bank engaged in fraudulent and unlawful debt collection practices against 100,000 California credit card borrowers over some three years.   Continued...

 
A sign outside the headquarters of JP Morgan Chase & Co in New York, September 19, 2013. REUTERS/Mike Segar