SAN FRANCISCO (CN) – JP Morgan Chase and the Chase Bank abuse their so-called “Payment Protector Plan” by calling in loans and canceling enrollment for customers who are supposed to be protected by the plan, a class action claims in Federal Court.
Chase claims its “Payment Protector Plan” protects credit cardholders who have lost their jobs or suffered a disability by freezing their monthly payments while Chase charges extra monthly fees. But if customers seek the protection Chase claims to offer the bank cancels the accounts and demands immediate payment in full, the class claims.
Lead plaintiff Christopher York says he unwittingly paid for Chase’s payment protector plan for 5 years before noticing the monthly payment on his bill. By that time, York says, he had paid thousands of dollars for the service, despite never having agreed to enroll. He says a customer service agent talked him into staying in the program.
But York says Chase refused to grant him benefits under the program in 2007, when the economy reduced his work as a general contractor. And he says Chase refused to suspend his payments 7 months later, when his wife lost her job.
Chase finally reversed its decision after months of pleading, York says. But 5 months after that, he says, Chase canceled his account and sent it to collection, plus interest of nearly 30 percent.
Fellow plaintiff Jennifer Harris says she had three Chase credit cards for several years before she was laid off from her job as vice president for market growth and development in Wells Fargo’s mortgage division. She says she had enrolled in the payment protector plan several months before she lost her job. She says Chase granted her suspension of her payments for up to two years, but canceled one of her accounts less than a year later, claiming the revolving balance was too high, and demanded that she resume making payments on the canceled account.
The class seeks restitution of the monthly charges they paid for the payment protector plan, plus interest.
Plaintiffs are represented by Ingrid Evans with Waters Kraus & Paul.