It will have to pay a separate $30 million penalty to the Office of the Comptroller of Currency.
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The 2015 consent order covers issues from several years ago for a small percentage of credit card credit card customers who defaulted on their credit card debt.
Iowa Attorney General Tom Miller, who has been leading the state level crusade against JPMorgan’s debt sales and collection actions, had no comment.
The deal with the New York-based bank was hammered out by 47 states, the District of Columbia and the USA Consumer Financial Protection Bureau as they seek to clean up tactics in the $13 billion consumer-debt-collection industry.
The investigations focus on alleged “violations of law relating to debt collection practices”, the bank said in the Securities and Exchange Commission filings.
Some of the other settlements JPMorgan has been part of earlier include a $500 million settlement to end more than six years of class action litigation over Bear Stearns’ sale of $17.58 billion of mortgage securities that proved defective during the USA housing and financial crises., as this Reuters article reports.
About 77 million American consumers have debt ranging from $25 to $125,000 that are subject to collection, according to the consumer protection bureau.
Mississippi and California are not expected to settle at the same time, sources said.
JPMorgan’s units allegedly sold uncollectible accounts to third-party debt buyers and got judgments without following proper procedures, a practice known as robo-signing, the person familiar with the matter said. The Mississippi lawsuit said employees described a “chaotic” and “disorganized” workplace marred by “rampant” mistakes, inadequate training, constantly changing policies, high turnover and unrealistic quotas.
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At the time, JPMorgan said that collection issues affected less than 1 percent of customers and that it had stopped filing collection lawsuits in 2011 and had stopped enrolling customers in credit-monitoring services in 2012.
