JPMorgan credit-card customers are seething about company plans to revoke their ability to sue them - here's how to protect yourself
- JPMorgan Chase is planning to revoke its credit-card customers' ability to sue them.
- The bank sent nearly all of its cardholders notifications alerting them that they were implementing binding arbitration that prevents customers from taking disputes to court or joining class-action lawsuits.
- The plan has been met with backlash from customers and consumer advocates who say the move will boost Chase's bottom line at the expense of customer protection.
- Customers can reject arbitration by sending Chase a traditional, postal letter by early August.
- Business Insider has reprinted a template letter that can be sent to Chase.
- Visit Business Insider's homepage for more stories
JPMorgan Chase is planning to revoke its credit-card customers' ability to sue them, and some are seething about the move.
The bank, the largest credit-card company in the country, sent out email notifications last week to customers alerting them to several "Important Changes to Your Account Terms." Among them was the implementation of binding arbitration, meaning in the event of a dispute, customers "cannot go to court, have a jury trial or initiate or participate in a class action for your dispute(s) with us."
The move, which affects nearly 50 million Chase customer accounts, isn't uncommon in banking, but it was met with backlash by some who viewed it as a way to curtail customer protections.
Mandatory arbitration is widely used across Wall Street as a way to help companies avoid costly, public legal altercations.
The change caught the attention of US Rep. Katie Porter, a Democrat on the House Financial Services Committee, who in a series of tweets called the practice "wrong" and said, "Rest assured, Jamie Dimon will be hearing from me."
A JPMorgan representative told The New York Times the practice was already standard in its consumer banking and auto loan businesses, and said the arbitration was faster, cheaper, and resulted in "better outcomes for our customers."
But instating arbitration is a way for credit-card companies to limit consumers' rights and boost company profits, according to Kenneth Grunfeld, a partner at Golomb & Honik who has represented consumers in class-action lawsuits against banks and credit-card companies.
"I think arbitration clauses that include class action waivers buried in consumer terms and conditions 'contracts' are licenses for big companies to steal a little bit of money from a lot of unknowing consumers," Grunfeld told Business Insider.
How to reject arbitration with JPMorgan
In the fine print of the emails JPMorgan sent out, the bank explains that to reject arbitration, customers must send the bank a traditional, postal letter by early August (the precise date may vary by customer).
Notifying Chase electronically or via the phone won't count.
Sara Haji, a lawyer based in California, shared a template letter over Twitter that cardholders can fill out and send to Chase.
The template can be viewed in a shared Google document, and Business Insider has also reprinted the template below:
JP Morgan Chase Bank, N.A.
P.O. Box 15298
Wilmington, DE 19850-5298
May 30, 2019
To whom it may concern,
On May 29, 2019, I received a communication from JP Morgan Chase Bank, N.A., explaining certain changes to the terms of the customer relationship. Among those changes is a new, binding arbitration provision with an opt-out notice. I now write to reject forced arbitration of future disputes relating in any way to my relationship with JP Morgan Chase Bank, N.A., Chase Bank USA, N.A., and all parents, subsidiaries, affiliates, and related entities ("Chase"). I reserve my right to litigate all claims against Chase - including collective actions - in court.
As requested, my information is as follows:
I have retained a copy of this letter for my personal files.
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