| NEW YORK
NEW YORK JPMorgan Chase & Co 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
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.
The state claims the bank flooded state courts with
questionable lawsuits, filing thousands every month, including
469 such lawsuits in one day alone.
Kristin Ford, a spokeswoman for the California attorney
general, did not return calls for comment.
Mississippi Attorney General Jim Hood's lawsuit filed a
similar lawsuit against JPMorgan in 2013.
The Mississippi lawsuit said employees described a "chaotic"
and "disorganized" workplace marred by "rampant" mistakes,
inadequate training, constantly changing policies, high turnover
and unrealistic quotas.
Rachael Ring, a spokeswoman for the Mississippi attorney
general, would only say the lawsuit is pending.
In September 2013, the U.S. Consumer Financial Protection
Bureau ordered JPMorgan to refund $309 million to about 2
million customers for illegal credit card practices, including
charging consumers for credit card monitoring services they did
The Office of the Comptroller of the Currency that month
also issued a consent order against JPMorgan after identifying
unsound practices in connection with the bank's sworn document
and collections litigation. The order demanded changes,
including to debt sales.
At the time, JPMorgan said collection issues affected less
than 1 percent of customers and that it stopped filing
collection lawsuits in 2011 and stopped enrolling customers in
credit monitoring services in 2012.
In 2012, Iowa's Attorney General Miller helped negotiate a
$26 billion settlement with the nation's largest banks over
mortgage abuses, which also included robo-signing.