Chase Cardholders – What You Need to Know About Chase Credit Card Arbitration Clause

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Recently, I did an article for BlackEnterprise.com about how JPMorgan Chase is making harder for their cardholders to sue or be a part of a class action suit against them. Here is what this action is all about and how to Opt Out before the deadline.

Chase cardholders were sent an email in May 2019 regarding changes to the terms of their credit card accounts. Although some may have deleted or ignored this notification, it could have included a “binding arbitration” clause that will limit or prohibit their ability to sue the bank.

If cardholders do not opt-out of the binding arbitration clause by the deadline, they will not be able to join any class action suits and will be required to have their dispute resolved through an arbitrator.

If you are a Chase credit card account holder, here is what you need to know and do.

WHAT IS ARBITRATION?

“With arbitration, you cannot go to court, have a jury trial or initiate or participate in a class action for your dispute(s) with us,” Chase stated in notifications sent to customers.

This new clause will require any dispute between consumers and Chase be resolved by binding arbitration. Customers will be banned from suing the company and required to have the case resolved through a private arbitrator. This clause also prohibits people from filing class-action lawsuits.

WHY NOW?

In 2009, a class action suit against certain banks accused them of forcing customers into arbitration. Chase and other banks agreed to drop arbitration provisions for a period of about three and a half years as a settlement in 2010.

After that period ended, banks brought back arbitration clauses. A report by the Pew Charitable Trusts reported nearly two-thirds of banks (72%) had such clause mandates in place by 2016 compared to 59% in 2013.

In 2016, the Consumer Financial Protection Bureau stepped in and proposed rules prohibiting mandatory arbitration clauses. However, in November 2017, President Trump signed a joint resolution passed by Congress to disapprove the Arbitration Rule under the Congressional Review Act (CRA), which means the rule has no force or effect.

This now gives Chase and other banks the opportunity to mitigate major losses from class-action suits by prohibiting customers from taking their disputes to court. A Chase spokeswoman stated … (continue reading)