Linda Almonte, a former assistant vice president at JP Morgan Chase, has filed a lawsuit against the banking giant claiming that its credit card unit misrepresented information about a portfolio of card debt for sale.

In the suit filed in Bexar County (Texas) District Court, Almonte alleges the bank did not have the court documentation for an estimated 11,000 accounts with judgments that the bank said it had, misrepresenting those accounts to potential debt buyers. She also alleges the portfolio included an estimated 5,000 accounts listing incorrect balances.

As a team leader at the time in the bank’s collection litigation unit in San Antonio, Texas, Almonte was in charge of auditing those accounts. She could not confirm some of the judgments or balances, she said, causing her to question the values with her immediate supervisor. In her suit, Almonte said she then approached the bank's management and said she would not be involved in the bank's attempt to sell the portfolio - which including more than 23,000 delinquent accounts with a value of more than $200 million. She says she was told to proceed with the sale.

Almonte alleges in the suit that she was relieved of her duties in November of last year as a result of her actions.

Chase officials declined to comment on pending litigation.

Debt buyers typically perform their own due diligence to confirm the value of a portfolio before completing a deal,  but sometimes the values and account ownership are difficult to determine.

Michael Cramer, president of the American Collectors Association of Texas, a trade group of collection agencies, told the San Antonio Express-News that he was surprised about the allegations against Chase. Parties that sell debt make warranties that, if untrue, allow the buyers to return the debt and pocket a refund.

Anyone making fraudulent misrepresentations would not be able to sell debt once the collection industry found out, he said, adding: "I can't imagine [Chase] doing that. You're going to be out of business."

No court date has been set on the case. Almonte is requesting a jury trial and seeks unspecified damages.

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