February 07, 2022

Warren, Colleagues Call On Chase to Address Reports of Predatory Robo-Signing

In the Wake of 2008 Financial Crisis, Chase Used Robo-Signing to Wrongly Sue Thousands of Customers

Washington, D.C. – U.S. Senator Elizabeth Warren (D-Mass.), along with fellow members of the Senate Banking, Housing, and Urban Affairs Committee, Chair Sherrod Brown (D-Ohio), and Senators Robert Menendez (D-N.J), Tina Smith (D-Minn), Chris Van Hollen (D-Md.), and Raphael Warnock (D-Ga.), sent a letter asking JPMorgan Chase (Chase) to address concerns about the company’s credit card collection practices, including their practice of robo-signing to sue customers. The senators reminded Chase that robo-signing in the wake of the 2008 financial crisis led to them wrongly suing thousands of financially vulnerable Americans. 

“We are deeply troubled by recent reports that Chase – the nation’s largest bank with over $3.2 trillion in assets – has renewed its predatory practice of robo-signing purported evidence of credit card debt to sue customers during the pandemic... At the height of the robo-signing scandal following the 2008 financial crisis, the CFPB found that Chase wrongfully sued thousands of customers for debt they did not owe,” the senators wrote. 

The Consumer Financial Protection Bureau (CFPB) found that between 2009 and 2013, Chase’s error rate for robo-signed documents was almost 9%, subjecting victims to wrongful debt claims, wage garnishment, and negative impacts on credit scores that would affect jobs, housing, and credit access. In 2015, the CFPB issued a consent order prohibiting Chase from engaging in robo-signing and certain debt collections practices that were in violation of the Consumer Financial Protection Act. After this consent order expired in 2020, Chase resumed robo-signing.

The senators asked Chase to answer a set of questions about its credit collection practices and use of robo-signing by no later than February 21, 2022. 

Senator Warren has been a longtime consumer protection advocate, using her platform to advocate for consumer protections and to hold big banks accountable for their predatory practices.

  • In August 2021, Senator Warren and Senator Cory Booker (D-N.J.) reintroduced legislation to crack down on exploitative overdraft fees that banks charge consumers when they make a purchase or pay a bill, but don’t have sufficient funds in their account.
  • In May 2021, Senator Warren slammed the CEOs of four of the nation's largest banks -- JPMorgan, Wells Fargo & Co, Citi, and Bank of America -- for taking a collective $4 billion in overdraft fees from people during the pandemic. Senator Warren also urged the CEOs to refund the billions they took from struggling consumers during the pandemic: not agreed to do so.
  • In July 2020, Senators Warren and Brian Schatz (D-Hawaii.) sent a letter to Charles W. Schaft, Chief Executive Officer and President of Wells Fargo, following reports about the bank placing borrowers who are not delinquent on their loans in mortgage forbearance programs without their consent and putting consumers at risk of greater financial hardship in the midst of one of the worst economic collapses in history. 
  • In 2018, Senator Warren and Senator Cory Booker (D-N.J.) sent a letter to the Consumer Financial Protection Bureau questioning its plan to no longer pursue regulatory action on overdraft fees after it failed to mention action in its most recent regulatory agenda filing, even though it had been on the Bureau’s agenda for four years.