JPMorgan Faces Lawsuit Over Crypto Charges

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JPMorgan Faces Lawsuit Over Crypto Charges

The battle to define how cryptocurrencies will merge into the conventional financial sector rages on. According to Reuters, JPMorgan Chase & Co. (JPM) was named in a complaint filed in Manhattan federal court last week involving its policies relating cryptocurrency purchases by consumers. JPMorgan is accused of collecting unexpected fees since late January, when it stopped enabling consumers to purchase cryptocurrencies using credit cards. From then on, purchases of digital currencies were recognized as cash advances by the bank.

According to the newspaper, the case was filed on behalf of a proposed national class. It claims that the bank levied additional fees and much higher interest rates on cash advances when compared to credit cards. According to the lawsuit, the bank reportedly refused to refund costs when clients submitted objections later in the process.

In response to the case, Chase spokesperson Mary Jane Rogers refused to comment directly on the action. According to Rogers, the bank stopped processing credit card transactions of digital currencies in early February due to the credit risk involved with the activity. Rogers also said that Chase customers may use their debit cards to purchase digital currency directly from their checking accounts without paying cash advance fees.

MovingToward a Unified Position

Chase is not the only bank that has prohibited the use of credit cards to purchase digital currencies. Following the significant drop in bitcoin values in the early months of 2018, Lloyds Banking Group, Virgin Money, and Citigroup all implemented similar restrictions.

Brady Tucker, an Idaho citizen, is named as a plaintiff in the Chase case. Chase charged Tucker $143.30 in fees and $20.61 in interest as a consequence of five bitcoin transactions conducted in the days following January 27 of this year. Tucker thinks that hundreds, if not thousands, of other Chase customers got identical charges. According to the lawsuit, Chase “handed the plaintiff with the bill after the fact of his transactions and insisted on his paying it.” The action claims that Chase violated the Truth in Lending Act, which requires credit card companies to inform clients in writing of any changes in terms or charges.

  Crypto Collapse

Investing in cryptocurrencies and Initial Coin Offerings (“ICOs”) is very dangerous and speculative, and this article is not a suggestion by Investopedia or the writer to do so. Because every person’s circumstance is different, a knowledgeable specialist should always be contacted before making any financial choices. Investopedia makes no guarantees or warranties about the accuracy or timeliness of the information provided on this site. The author owns bitcoin and ripple as of the day this post was published.

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