This is an investigation and pending class action lawsuit against JP Morgan Chase & Co. and Chase Manhattan Bank USA, N.A. (collectively, "JP Morgan Chase"), on behalf of a class of customers who have been charged a monthly service fee on balance transfers to their JP Morgan Chase credit cards that have low fixed APRs for the life of the loan.
The class action lawsuit alleges that JP Morgan Chase spent several years solicited JP Morgan Chase credit card customers in good standing to use Chase Balance Transfer Checks to transfer outstanding balances from other customer loans to the JP Morgan Chase credit card. In JP Morgan Chase's original agreement, JP Morgan Chase represented to its customers that to keep the low interest rates, the customers must only make timely required payments to JP Morgan Chase and the customers' creditors. To induce the transfer, JP Morgan Chase promised a low fixed annual percentage rate for the life of the balance ranging from 2.99% to 4.99%. The class action lawsuit alleges that to induce the transfer, JP Morgan Chase made the following representations to consumers:
1. JP Morgan Chase promised that those who used the Chase Balance Transfer Checks a "3.99% fixed APR until the balance is paid off".
2. JP Morgan Chase touted in its solicitation "It's like giving yourself a fixed rate loan with no application and no waiting around for approvals."
3. JP Morgan Chase represented in its solicitation materials that "the new Fixed APR you'll pay will remain in effect until your balance is paid in full, as long as your account is open and in good standing."
The class action lawsuit alleges that despite this JP Morgan Chase representations, JP Morgan Chase began charging a $10 per month service charge or monthly maintenance fee to customers that relied on the above representations. JP Morgan Chase allegedly told consumers that the only way to avoid this $10 fee is to increase their monthly payments to JP Morgan Chase. Significantly, these consumers are in good standing.
This class action lawsuit contends that JP Morgan Chase's conduct violates federal Truth in Lending laws, state common law and state statutes prohibiting unfair and deceptive business practices.
Name (Stock Symbol)
JPMorgan Chase & Co. (JPM)
JPMorgan Chase & Co., a financial holding company, provides a range of financial services worldwide. It operates in six segments: Investment Bank, Commercial Banking, Treasury & Securities Services, Asset Management, Retail Financial Services, and Card Services.
Chase Manhattan Bank
Chase Manhattan Bank is now known is Chase. It is the consumer and commercial banking division of JPMorgan Chase & Co.
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