Maryland readers most likely already know that JPMorgan Chase is one of the largest credit card providers in the United States. Therefore, it should not be surprising that the company has been involved in more than one business dispute. One of the most recent disputes was with several states and the District of Columbia, along with the U.S. Consumer Financial Protection Bureau (CFBP) over the company's debt collection practices.
The company was accused of engaging in what has been dubbed as "robo-signing" in its filing of lawsuits against consumers. In other cases, it was alleged that JPMorgan was attempting to collect debts from the wrong parties, which had adverse effects on several people's credit. It was also claimed that they turned over debts to collection agencies that were no longer accurate or collectible.
A settlement was recently reached that is valued at approximately $136 million. Other stipulations require the company to stop attempting to collect the debts for lawsuits filed or judgments obtained against around 528,000 people from Jan. 1, 2009 to June 30, 2014. Some of the money will be given to consumers, and the rest will be divided among the states involved, Washington, DC and the CFPB.
Collecting monies owed to it is part of every business in Maryland. However, it is crucial that any debt collection is conducted in accordance with both state and federal laws. A company needs to be sure that it has appropriately documented any efforts to obtain payment in case a business dispute arises regarding a debt it is trying to collect. This information will be necessary when either filing a lawsuit against the party who owes the money or defending the company against a party claiming that it violated collection laws in order to avoid an inquiry such as the one that led to JPMorgan's recent settlement.
Source: USA Today, "JPMorgan to pay $136M settlement of credit card probes", Kevin McCoy, July 8, 2015