Legal Battle Unfolds: Lawsuit Targets Chase for Alleged 'Unconscionable and Predatory' Junk Fees on Bounced Check Deposits

Legal Battle Unfolds: Lawsuit Targets Chase for Alleged 'Unconscionable and Predatory' Junk Fees on Bounced Check Deposits

  • Wednesday, 21 February 2024 19:37

Legal Battle Unfolds: JPMorgan Chase Faces Lawsuit Over Alleged 'Unfair' Fees on Bounced Checks

JPMorgan Chase, the largest bank in the United States, finds itself embroiled in a lawsuit filed by customers who claim they were unfairly charged fees for depositing bounced checks. In the proposed class action filed on Tuesday night, five customers accused the New York-based bank of deducting $12 "deposited item returned fees" from their accounts when checks they attempted to deposit were returned unpaid. These checks bounced for various reasons, including insufficient funds, stop payment orders, or errors.

The customers labeled Chase's fees for returned checks as "unconscionable" and "predatory," referencing a Consumer Financial Protection Bureau bulletin from October 2022, which suggested that indiscriminate charging of such fees could be illegal. According to the complaint, Chase's imposition of these fees unfairly penalized customers for faulty checks they had no involvement in issuing.

Although Chase declined to comment on the lawsuit, it confirmed that it ceased charging these fees in December 2022. However, the five customers involved in the lawsuit claim they were charged between November 2021 and October 2022. Their lawyer, Lisa Considine, condemned the practice of imposing such fees as "a pervasive and unfair industry practice.

The complaint seeks damages of at least $5 million for Chase customers nationwide, alleging violations of consumer protection laws in New York, California, Illinois, and New Jersey. The lawsuit was filed in the White Plains, NY, federal court.

The lawsuit against Chase comes amid broader scrutiny of hidden and surprise fees across various industries. In October, the Biden administration called for a crackdown on such fees, highlighting their significant financial impact on Americans.

The case, titled Maslowski et al v JPMorgan Chase Bank NA, is being heard in the U.S. District Court for the Southern District of New York under case number 24-01277.

In conclusion, the lawsuit against JPMorgan Chase underscores the ongoing struggle consumers face regarding unfair banking practices, particularly in the imposition of fees for bounced checks. The allegations of "unconscionable" and "predatory" behavior highlight the broader concerns around financial institutions penalizing customers for circumstances beyond their control. As the legal battle unfolds, it serves as a reminder of the importance of consumer protection laws and the need for greater transparency in banking practices. The outcome of this case could have significant implications not only for Chase customers but also for the wider banking industry. It underscores the necessity for continued vigilance in addressing hidden fees and ensuring fairness and accountability in financial transactions.