Chase settles Freedom card payment protection scheme case

I knew Chase was bad, but this is BAD.  Chase recently settled a class-action lawsuit related to the payment protection plan for its Chase Freedom Card.  Apparently it automatically enrolled people in this plan that came with a monthly charge, and then made it nearly impossible to get the benefits.

… the lawsuit alleges that Chase unilaterally enrolled cardholders in Payment Protection Products that suspend or cancel the balance due on the credit card under certain circumstances without adequately disclosing the terms of these products prior to enrolling a customer. The lawsuit further alleges that it was too difficult to obtain Payment Protection benefits for eligible claims, it was too difficult to disenroll from Payment Protection Products, and that those Products were improperly marketed and sold.

WaMu awarded posthumous account transfer patent

In a seriously funny turn of events, the USPTO just awarded Washington Mutual a patent on a system to automatically transfer information from an old account to a new account and take into account common kinks that can happen along the way.

Chase sure could have use this system when they took over all the WaMu account with all the problems people encountered.

Chase online bill-pay broken?

A customer reported that the online bill-pay feature at Chase.com has not been working since the aesthetic upgrade they performed the previous weekend.

This past weekend (11-13-11) Chase implemented a new look for their online banking.  Starting on Monday morning the bill pay service has not been working.  It is now Wednesday and we have had no bill payment service for three days!

Daily Beast calls Chase America’s worset bank

Makes sense to me.

Where to start?

There’s the $211 million fine JPMorgan paid in July to settle charges that it defrauded local governments in 31 states—along with the $130 million it returned to municipalities it was accused of duping.

There’s the $722 million in fines and restitution payments it made after JPMorgan confederates were caught paying off officials in Jefferson County, Alabama (home to Birmingham), to secure a municipal finance deal that nearly bankrupted the county.

There’s the fact the bank was in so great a rush to evict people from their homes that it admits that some of its people might have forged foreclosure documents—a problem so widespread that it felt compelled to suspend 56,000 foreclosures while it investigated its own behavior.

Or maybe the biggest sin is the central role JPMorgan has played—and continues to play—in the rise of what might be called the “poverty industry”: all those businesses that exploit the working poor, such as the payday-loan industry, where lenders charge 400 percent interest on short-term, small-denomination loans against a person’s next paycheck (or their Social Security or unemployment payments).

Chase financial advisor likes to moralize customers

From this blog post we find that a financial adviser employed by Chase likes to tell customers when he thinks they are in the moral wrong.

On October 27th 2011 I went in to have a chat with my bank, JP Morgan Chase to find out what investing options they have (if any). This was a pre-planned appointment based on a casual inquiry I had a week earlier with one of the tellers downstairs.

Went to the Chase Bank on Solano Avenue and was greeted by Emmett Peck who is the VP and a Certified Financial Planner (CFP).

I provided some background info and told him that I’ve had to go through a short sale and was looking for more information on other investment areas.

— Bought a home 3 years ago for 350k which is now worth 150k. Pretty much worthless.

1) Emmett Peck told me that it’s people like me walking away from our homes that are causing all these financial and economic problems we are facing today.
— yes, Emmett Peck a Certified Financial Advisor stared at me point blank with total conviction that he believes this to be the truth.

2) Emmett Peck also said that buying a home is NOT an investment. It’s to live in and is only for that purpose.

So if you are looking for some stellar advice from a condescending banker who blames the customer for the banking and economic problems (which apparently is caused by hardworking Americans who paid too much for their houses) — this is the bank you should make a beeline for.

The time to challenge your foreclosure is NOW!

If there ever was a time to challenge your Chase foreclosure, it is now.

It’s late, and it’s limited, but for borrowers who feel their homes were wrongly or inappropriately foreclosed upon in 2009 and 2010, there is now recourse.

As part of a larger enforcement action (so-called “consent orders”) taken last April against fourteen of the nation’s largest mortgage banks/servicers following the so-called “robo-signing” scandal, the Office of the Comptroller of the Currency is beginning a “multi-faceted independent review of foreclosure actions.”

The major banks, including Bank of America, Chase, Citibank, Wells Fargo, GMAC, and EMC, will have to fund these independent reviews to evaluate, “whether borrowers suffered financial injury through errors, misrepresentations, or other deficiencies in foreclosure practices.” If they did, those borrowers get some kind of “remediation.”

“The challenge is substantial, but the steps we have required the servicers to take are vitally important to resolving these issues in a way that respects the rights of those who have been harmed and helps to restore confidence in the system,” said John Walsh, Comptroller of the Currency in a statement.

The major mortgage servicers began sending out letters to eligible borrowers today to explain the process. The requests for the reviews must be received by April 30, 2012. So how many do they expect will request these reviews, given that there are potentially four and a quarter million eligible borrowers according to the OCC?

Read more …

While most of the press I’ve read about this focuses on people who were foreclosed upon that should not have been (i.e. they were current on their mortgage) that represents just a small portion of the people Chase has wronged.

Where Chase has done the most harm is with the people that it told to stop paying their mortgage so they could be considered for a loan modification (and then foreclosed), the people that Chase said didn’t qualify for a loan modification (even though they should have), and the people that Chase blatantly foreclosed upon while they were in a trial modification and paying according to the rules (parallel foreclosure).

It is hard to say whether such customers will get a serious look under this program, but by challenging the foreclosure anyways, you are helping to send Chase a message and perhaps the regulators overseeing this process will take notice.

In other words, it’s worth a shot.

Despite all the whining, banks still make bank from overdraft fees

From all the whining, you’d think banks loss of their golden goose, automatically signing up people for debit card overdraft protection, was all but gone now that it has been outlawed.

Well, apparently that isn’t the case.  According to Bloomberg Business Week (Overdraft Fees, The Dough Keeps Rolling In), banks have been able to keep about 70% of the overdraft revenue by using every manner imaginable to cajole customers into signing up for overdraft protection, something that clearly isn’t in customers interest.

Among some of the tactics is calling up customers that have had debit cards rejected due to insufficient funds (you know, what is supposed to happen when you are out of money) and giving them the impression that they will incur fees when this happens unless they sign up for overdraft protection.

Make no mistake, overdraft protection on debit cards benefits the banks only, not the customer (unless you like spending $40 on a latte).

To add insult to injury, the article claims that most big banks are still rearranging credits and debits under the guise that it helps customers.  What this actually does is, when an overdraft does occur, it increases the likelihood that more overdraft fees will be applied, as banks will debit the largest item first, regardless of what order it all happened.

Happy Bank Transfer Day

I trust everyone had a great Bank Transfer Day, which was yesterday.

Apparently the biggest boon to credit unions this year has been the attempt by big banks (all but abandoned now) to institute a debit card usage fee.  According to NPR Marketplace, credit unions have seen more new customer accounts opened in the last six weeks than they do in a typical year.

Congratulations on those of you who finally realized the big banks don’t care about you.