Koster secures $916K settlement from Chase

In a nationwide settlement with Chase Bank, Missouri Attorney General Chris Koster secured $915,791 for the Show-Me State.

Under settlement terms, Chase Bank USA N.A. and Chase BankCard Services Inc. agreed to pay $136 million to 47 states, Washington, D.C., and the Consumer Financial Protection Bureau to settle claims of unlawful credit card debt-collection practices affecting over 528,000 consumers, including roughly 2,400 in Missouri, according to a news release.

“Chase’s credit card debt-collection practices harmed thousands of consumers here in Missouri and across the country,” Koster said in the release. “Chase often used wrong or outdated information to pursue debts, including debts that had already been discharged. Chase must now change its business practices and treat consumers fairly in the future.”

Investigators discovered Chase pursued collections based on false information, including instances when the debt was in the wrong amount, tied to the wrong person, was discharged or was barred because of time constraints. The company also was accused of:

• subjecting consumers to inaccurate credit reporting and unlawful judgments, potentially hurting their ability to gain credit, employment, housing or insurance;
• selling accounts to debt buyers that were inaccurate;
• filing lawsuits and obtaining judgments against consumers using false and deceptive affidavits and other documents; and
• making calculation errors when filing those lawsuits.

From 2009-13, Chase collected $4.5 billion of debt from defaulted accounts through lawsuits or selling the accounts. According to Koster, the settlement holds Chase responsible for past practices and requires debt-collections reforms, including accuracy safeguards, additional data to consumers and a ban on reselling consumer debts to other purchasers.