Whistleblower Linda Almonte vs JP Morgan Chase Debt Collection Allegations

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If you happened to be involved in a consumer debt lawsuit with JP Morgan Chase last year or around the beginning of this year, you may have wondered why your collection suit may have been halted or even completely disappeared. This event was the result of an investigation into Chase credit card’s collection activities. According to the Office of the Comptroller of the Currency (OCC) and numerous Chase employees, as well as whistleblower, Linda Almonte, Chase bank has allegedly engaged in the following “errors” or unlawful activity when collecting debts:

Affidavits of Amounts Owed Were Not Verified – According to employees, affidavits were not verified. Employees were told to just sign them because they were time sensitive. A practice known as robo- signing, the mass signing of important documents by banks in foreclosures, was also allegedly occurring with documents filed by Chase Bank and collection accounts. This practice is something that may result in all banks and companies that provide any type of loan or mortgage, to be investigated.

Unreliable Attorneys and Inaccurate Information – Court filings and documents prepared by external attorneys as well as the litigation operations for Chase Credit Cards were inaccurate and unreliable. Attorneys known as “outhouse attorneys” were hired by less populous states in place of in-house attorneys. Outhouse attorneys were paid according to the amount of money that was recovered. Not only that, these attorneys were only connected to the litigation system and were a part of firms such as Mann Bracken, LLP which were known for inaccurate recordkeeping.

Out of Date and Unreliable Technology – Apparently JP Morgan Chase utilized patchy technology and bank computer systems which disagreed on the amounts that were actually owed. The computer systems used were unable to communicate well. Whatever the case, it seemed that each different computer system (TSYS, TCSF and RMS) would come up with a different amount owed.

According to the investigation by Americanbanker.com, TSYS is a system that is licensed from Total Systems Services Inc. It is the interface which consumers use to check their credit card balance online. The Total System software handles only current account. When accounts are late or delinquent, it is passed on to another system called TCSF. This system is used by the folks in collections and litigation. When an account gets charged off, they get moved to another system called RMS. The three different systems do not show the same number when it comes to the amount that is owed by the bank.

Most of these findings are based on information from former and current Chase employees and from whistleblower, Linda Almonte who worked as an executive in the Credit Card Litigation Support Group in Chase’s San Antonio office. Almonte claimed she was terminated in 2009 because she objected to the sale of debts that included incorrect balances owed. It was because of Almonte’s claims that the OCC shutdown the collections operation in April 2011.

Problems With Whistleblower Linda Almonte – Linda Almonte was hired as part of a replacement crew and noted the problems with the systems. She was concerned especially about the faulty and inaccurate recordkeeping of the law firms that were used for the lawsuits and documents almost never matched Chase’s records. Documents were misplaced and destroyed and Almonte ended up being terminated.

Why Ignore Inaccuracies? – Chase Bank was able even amidst the financial crisis in 2008 to expand and increase recoveries and were able to recover $1.2 billion in debt by 2009. Litigation and lawsuits ended up being extremely profitable to JP Morgan Chase. It could only be speculated that these errors an inaccuracies were ignored because debt collection resulted in so much money. Many former employees also believed that the inaccuracies were not large enough to matter. Still, once the inaccuracies are added up, it could result in thousands of dollars. Besides the fact that reporting different amounts owed kind of makes you wonder how reliable the collection practices are in the first place.

What this Means to Consumers – If you are one of the many cardholders that were transferred to Chase when Providian and Washington Mutual were bought out, you likely ended up with a closed account. Almost immediately upon merging, Washington Mutual cardholders found themselves with lowered credit limits (and thus maxed out cards), higher interest rates, and closed credit cards. In one broad sweep, Chase sunk a lot of cardholders who were part of the sub prime market that was once Washington Mutual. Many of those cardholders were able to sign up for hardship programs with lower interest rates and smaller payments (although the cards are still closed and cannot be used).

Bad debt accounts that were once Providian and Washington Mutual, although lacking proper documentation and considered unreliable, were sold to second-hand debt buyers who were suing account holders when the debt was not supposed to be sold in the first place. These past account holders may also want to be aware that because of the investigation, JP Morgan Chase & Co. has currently halted collection lawsuits and judgments in six states, California, Florida, Illinois, Maryland, New York and Washington. Collection cases in most other states have either slowed down or only exist in very small amounts. As with any collection account where litigation is involved, it is recommended that you meet with an attorney. Now that it seems records, robo-signing, attorney records, and computer systems are all reporting inaccurate information, it may be in your best interest if you have delinquent accounts (old or new) with Chase, that you especially consult an attorney before agreeing on payment or going to court.

It is not clear yet how Chase Bank will approach the bad debt accounts while they are being investigated for their numerous alleged violations and inaccuracies. Collection claims have decreased quite a bit nationally and many have been completely dismissed altogether. If you happen to be one of the thousands of debtors in this situation, a former account holder of a Washington Mutual or Providian card account that has been sued, or is being sued, you will want to consult an attorney. Make sure you are aware of you options before agreeing to any kind of plan that Chase has to offer. At least at this point and until the rest is somehow straightened out.

References
1. Linda Almonte whistleblower complaint in 2010
2. OCC probing JPMorgan Chase Collection Practices
3. JPMorgan Chase Credit Card Collection

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6 Responses to “Whistleblower Linda Almonte vs JP Morgan Chase Debt Collection Allegations”

  1. Margo Caldwell Says:

    I’m one of those Wamu cardholders thus “sunk” & supposedly on a “hardship program” (the only hardship being that imposed by all the banks calling their unsecured loans at the same time. I’ve been paying what they say I owe– is it wise just to get them “off your back?”

  2. james Says:

    My Mother who will be 85 in a few days is in a nursing home. has been called by a collection agency for years all they have is her phone number they don’t even ask for her by name. I’ve called AT&T they want even give me the company name. I call the Missouri AG they said they didn’t do that type of legal work. she has never had a credit card are a loan

  3. Linda Almonte Says:

    Just get a subpeona :) Look at my LinkedIn Profile and you can always send a message through there. Read last weeks front page NY Times with my name about riddled credit cards not limited to one sale at Chase. Demand the media tell the whole story. Tell me your problem and I will see if I can help or send you to someone that can. At the same time go to this link I know it takes a while but detail out your problem on the CFPB site they aren’t empowered to help you unless consumers complain, I will help all I can. I estimate I need to find about 100 million more. So far changed all the laws in every courthouse in NY help me fiish the job!! I welcome consumers, attorey;s legal aid, community organizations and AG’s.

  4. Linda Almonte Says:

    Created by Linda Almonte on May 24, 2013SAN ANTONIO, TX 0 http://www.lindaalmonte.com
    http://www.huffingtonpost.com/2012/05/07/linda-almonte-jpmorgan-chase-whistleblower_n_1478268.html

    I am currently working with state and federal regulators, consumers, consumer attorneys and community organizations nationwide to not only as I have done expose intentional fraud against consumers by multiple banks but to not stop until solutions are put into place and the hundreds of billions of dollars in illegally obtained judgments against consumers are vacated. I cannot hold down a normal job and continue this fight. In most cases my father uses his social security and va disability to pay for the travel and has given up his home and life to help support my family. Help me to continue my four year long fight and provide more education and resources to consumers. Phase one of my website went live this week need funding to expand to arm consumers to take on the TBTF’s and level the playing field in court rooms. Any assistance is appreciated from funds to airline miles to hotel points for travel to various states. Also, please sign up on my new website to receive regular updates of new information you or a family or friend may need to stop the bank fraud.Here are some links of the countless stories I have worked on with writers to educate and empower people, regulators and courts to stop the fraud and help the people.
    I have attached the full government filing and I waived my rights to stay anomonys so the information does not get buried there was never anything in this for me I just refused to commit fraud at the expense of people to keep my job. Here are just some of the main articles on me you will notice a great deal is not public yet especially the connection with Chase owning NCO and SST and running litigation for the other banks. All of this proven up and a major class action with it we just survived the motion to dismiss.

    Linda Almonte

    http://www.nytimes.com/2010/11/01/business/01debt.html?pagewanted=all

    NY Times Article that I accidently coined the term “robosigning”

    http://www.dailyfinance.com/2010/12/17/chase-sec-whistleblower-complaint-credit-card/

    http://online.wsj.com/article/SB10001424052702304231204576404052290445530.html

    http://www.forbes.com/fdc/welcome_mjx.shtml

    http://www.americanbanker.com/issues/177_49/chase-credit-cards-collections-occ-probe-linda-almonte-1047437-1.html?pg=5

    http://www.foxbusiness.com/news/2012/03/13/occ-investigating-jp-morgan-credit-card-collections-report/

    http://www.rollingstone.com/politics/blogs/taibblog/j-p-morgan-chases-ugly-family-secrets-revealed-20120313

    http://www.cbsnews.com/8301-500395_162-57396150/feds-probe-jpmorgan-chase-credit-card-collections/?fb_comment_id=fbc_10150652312086166_21202916_1

    http://www.insidearm.com/opinion/lying-down-with-big-dogs-jpmorgan-chase/

    http://moneyland.time.com/2012/03/15/regulator-probes-chase-over-allegations-of-robosigning-in-credit-card-collections/

    http://www.americanbanker.com/issues/177_52/jpmorgan-chase-credit-card-collections-1047573-1.html?pg=3

    http://www.businessweek.com/articles/2012-03-13/credit-card-debts-got-robo-signers-too

    http://www.nytimes.com/2012/04/03/opinion/nocera-why-people-hate-the-banks.html

    http://www.huffingtonpost.com/jerry-ashton/even-jpmorgan-chase-takes_b_1352870.html

    http://www.huffingtonpost.com/2012/05/07/linda-almonte-jpmorgan-chase-whistleblower_n_1478268.html

    http://online.wsj.com/article/SB10001424052702304177104577314080130077636.html

    Talk Show Connect With Mark Kelley on CBC my part starts 33 minutes in http://www.cbc.ca/video/#/News/1221258968/ID=2233839152

    Recent Attorney General Suit in California Based on the information I exposed so far 100,000 victims found in just one case including intentional fraud against our active military while deployed.

    If you have been sued by a bank, collection agency, attorney network or credit card company and the balances or dates seem wrong or the account was sold you may be a victim. Go to my site and file a complaint with your states Attorney General, the FTC and CFPB. Your feedback and complaints provides the resources needed to stop this economic treason to our economy and hurting families. Please send me your stories the more I have the more people I can help.

  5. Rina Says:

    Time is of essence
    Served Summons. No account #, no contract attached. Amount is not right. Please advise

  6. Rina Says:

    I hate CHASE and their Shady Greedy ways. I have read nothing but negative about them and Harris and Zide.

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