JPMorgan Chase & Co. reportedly has abandoned more than a thousand debt-collection lawsuits across the U.S. that sought to recover soured credit-card loans from borrowers, according to Dow Jones.
A Chase spokesperson told PaymentsSource via email the bank’s collections strategy is proprietary and that it has no further information to share.
The nation's second-largest bank by assets, including more than $100 billion in credit-card accounts, would not disclose the number of cases dismissed or the reasons for the move. State judges told Dow Jones the bank has dropped lawsuits targeting borrowers in California, Florida, Illinois, New Jersey and New York since April.
In those five states, Chase was owed $45.9 billion on outstanding credit cards as of March 31, including both current and delinquent accounts.
Thomas Donnelly, an Illinois state-court judge in Chicago, said lawyers for Chase asked to withdraw all the pending collection cases in his courtroom this month, without explaining their decision. He allowed the bank to dismiss the cases without prejudice, meaning Chase can refile them later, according to the Dow Jones report.
At least for now, though, the borrowers will not be subject to one of the most effective debt-collection tools. Roughly 94% of collection cases filed against borrowers result in default judgments in favor of the lender, Dow Jones said, citing industry estimates.
