The CFPB alleged the bank illegally relied on robo-signing
Signing mass quantities of documents without verifying the data in those accounts and provided inaccurate information to third-party debt collectors when it sold the accounts. The bureau also said that Chase filed misleading lawsuits using inaccurate information to obtain debt collection judgments - on accounts that were paid off, discharged in bankruptcy, or otherwise were uncollectable.
"Chase sold bad credit card debt and robo-signed documents in violation of law," said CFPB Director Richard Cordray in a statement.
It will have to pay a separate USD 30 million penalty to the Office of the Comptroller of Currency.
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The agreement will also include changes to the way Chase will collect delinquent accounts. Any accounts that Chase sells to debt collection agencies will be unable to be resold to other agencies. Chase will also have to verify individually any account it sells to a debt collection agency confirming the debts are valid, and it will have to notify the delinquent customer that their debt was sold, among other changes.
"We are pleased to resolve these legacy issues," the bank said in a statement.