News & Resources

Unexplained dismissal of JPMorgan credit card suits may be related to robo-signing

Jun 28, 2011 Mike Garretson

JPMorgan Chase recently dropped debt collection lawsuits from borrowers in six states, according to the Wall Street Journal. In April, the bank filed suit against creditors in California, Florida, Illinois, New Jersey and New York, where it's reported that it was owed $45.9 billion in outstanding credit card debt as of March 31, in both current and delinquent accounts. In total, the firm dropped more than 1,000 collection-related lawsuits in those five states. According to the National Journal, the bank declined to comment for the reason behind the dismissal. It has been under the microscope recently for its use of "robo-signing," whereby employees sign large numbers of documents oftentimes without reviewing them. While JPM has yet to be accused of any wrongdoing related to irregularities in lawsuit paperwork, state judge Philip Straniere tells the news source that deficiencies in credit card collection cases are an unacknowledged issue. "It's a significant problem that's widespread and yet given virtually no attention," he said. Illinois state-court judge Thomas Donnelly said lawyers for JPMorgan requested he withdraw the pending collection cases without explanation.