In a satisfying swoop of ironic justice, JP Morgan has been sued for charging crypto purchases as high-interest cash advances.
The plaintiff, a Brady Tucker of Idaho, filed the lawsuit against the company in Manhattan Federal Court on Tuesday, April 10th. It alleges that Chase Bank of JPMorgan Chase charged cryptocurrency investments as high-interest cash advances rather than normal purchases. This would be a possible violation of the federal Truth in Lending Act.
The charges were said to have begun to occur suddenly in late January 2018, when the bank reportedly changed the classification of his cryptocurrency purchases but failed to notify investors of the change. This was shortly before the bank outlawed cryptocurrency purchases entirely in February.
This meant that Tucker incurred additional fees of $143.30, and extortionate interest charges of $20.61 for cryptocurrency transactions he made in January and February.
Furthermore, the bank is alleged to have refused to refund the charges to customers who complained through the customer service line.
US Truth in Lending Act
The US Truth in Lending Act is a federal law designed to ensure the informed use of consumer credit. In recognition of this, the lawsuit asks to recover the actual financial damages, and statutory damages to the tune of one million dollars, plus the cost of action including attorney fees and expenses incurred.
The lawsuit suggests there could possibly be thousands of Chase customers who’ve been similarly affected by unexpected fees, which could be quite a payout.
The Crypto Ban
In February of this year, several U.S. banks, including Bank of America, Citigroup, JP Morgan, Capital One and Discover took the liberty of banning their customers from purchasing cryptocurrencies.
According to the banks, this was purported to “protect customers,” and it has since emerged that some of the banks have been working on their own blockchain solutions.