Chase customers in Palm Beach County who are part of a $136 million nationwide settlement are beginning to receive postcards instructing them about how to collect their share.
Roughly 5,000 Chase customers in Florida will receive more than $4.6 million as part of a $136 million nationwide settlement announced in July.
JPMorgan Chase & Co. agreed to reform its unlawful credit card debt-collection practices through the joint state-federal settlement with Attorney General Pam Bondi, 47 other attorneys general, the District of Columbia, and the Consumer Financial Protection Bureau.
Florida will receive the largest remedial payment of any state in the settlement, Bondi said. In addition to the $4.6 million going to Chase customers, $1.6 million will go to the state’s general revenue fund.
Another $15.3 million will go to 47 nonprofit organizations to be used for legal services, financial literacy, and other programs related to assisting Floridians with managing debt.
The joint state-federal agreement, through an assurance of voluntary compliance with the states and a separate order with the CFPB, follows an investigation into Chase’s past debt collection practices.
The agreement requires Chase to significantly reform its credit card debt-collection practices in areas of declarations, collections litigation, debt sales and debt buying. Debt buying involves the sale of debt by creditors or other debt owners, often for pennies on the dollar, to buyers who then attempt to collect the debt at full value or sell it.
Among other reforms, the agreement requires new safeguards to help ensure debt information is accurate and inaccurate data is corrected, provides additional information to consumers who owe debts, and bars Chase’s debt buyers from reselling consumer debts to other purchasers.
Previously, initial buyers of Chase’s consumer credit card debt could resell the debt, the subsequent buyer could flip the debt to another buyer, and the process could repeat itself many times over. If initial information about the debt was incorrect or was transmitted with errors to a subsequent debt buyer, that could result in long-term harm to the consumer and leave the consumer with the difficult or even impossible burden of successfully challenging or correcting errors.
For collections litigation that was pending between Jan. 1, 2009, and June 30, 2014, Chase is also ceasing collection activity on judgments held by Chase and seeking to withdraw, dismiss or terminate any pending litigation matters and will request that credit reporting agencies not report these judgments against borrowers. Chase is required to send notice to affected borrowers that it is ceasing these collection efforts.