If Jamie Dimon didn’t believe in karma before, he may be a believer now.
JP Morgan has been hit with a class-action lawsuit on allegations of tacking on unannounced layers of fees plus interest after pulling the rug out from under the feet of cryptocurrency investors, according to a Reuters report. No wonder the decentralized revolution is upon us.
The bank put the kibosh on credit card purchases for cryptocurrencies earlier this year when it also sparked controversy by treating crypto purchases as cash advances, the latter of which command higher fees. JP Morgan CEO Jamie Dimon infamously called bitcoin a fraud a while back, and now those words are coming back to haunt him.
The plaintiff, Brady Tucker, is from Idaho and the lawsuit was filed in a New York court. He alleges that JPMorgan charged additional layers of fees and much higher interest on the cash advances versus what they charge for credit card purchases. Customers cried foul, but the bank refused to budge.
A Chase spokesperson told Reuters that while the bank placed a ban on credit card purchases for bitcoin and altcoins, they did so “because of the credit risk involved” and pointed out that customers could still use their checking account-linked debit cards for purchases and bypass fees. JP Morgan wasn’t the only bank to ban credit card use for bitcoin, as Bank of America, Citi and others took similar action amid a pullback in the bitcoin price in the new year.
Meanwhile, the Plaintiff is fighting back after being charged these extra fees, including more than $140 in “fees” and another $20-plus in sudden interest charges tied to nearly half-a-dozen transactions right about the same time Chase implemented the ban.
According to the lawsuit, there are “hundreds” and “possibly thousands” of other Chase customers who were similarly met with these unexpected fees in their accounts. While the suit may be about the fees, it wouldn’t be surprising to learn that it’s also about the principle.
‘Stuck It to Him’
Before turning to the law, Tucker reached out to JPMorgan Chase’s customer service and afforded them the chance to remove the charges, to no avail. Instead, the lawsuit says the bank “stuck the plaintiff with the bill, after the fact of his transactions, and insisted that he pay it.”
Tucker’s attorneys are arguing a violation of the US Truth and Lending Act, which is designed to protect consumers from “unfair credit billing and credit card practices.” It also says that financial institutions must inform customers of any changes to the terms in writing.
The class action lawsuit is seeking damages of $1 million.