Coffee_before_tea

Chase gets smacked down by CFPB - Potentially very important info going forward

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In Crestar, Cheevers disputed the charges with the OC and went as far as contacting the police.  This is not what happens in the average JDB case.

 

" Mr. Cheevers called Officer Wright and the attorneys. Subsequently, in January 1996, he notified Crestar, the bank's attorneys, and the Amtrak Police in writing that he disputed the October and November 1994 charges. He testified that he did not make the Amtrak charges, that he did not receive any benefit from the charges, that neither he nor his family traveled during that period of time, that he did not give tickets to anyone, and that he does not know who made the charges."

 

New Century Services Financial v Dennegar discusses 1643b and the burden of proof.

 

 

https://scholar.google.com/scholar_case?case=10015481035985920941&q=TILA+1643+credit+card&hl=en&as_sdt=ffffffffffffe04

 

 

 

 

Defendant lastly argues that the TILA precluded the entry of a judgment against him for the balance due on this account. We find no merit in this contention. Congress enacted the credit card provisions of the TILA "in large measure to protect credit cardholders from unauthorized use." Towers World Airways Inc. v. PHH Aviation Sys. Inc., 933 F.2d 174, 176 (2d Cir.), cert. denied, 502 U.S. 823, 112 S.Ct. 87, 116 L.Ed.2d 59 (1991). As a result, the TILA credit card provisions were designed to strictly limit the cardholder's liability for "unauthorized" charges, 15 U.S.C.A. § 1643(a)(1), by, among other things, placing the burden of establishing cardholder liability on the card issuer, 15 U.S.C.A. §1643( B), and imposing criminal sanctions for the fraudulent use of credit

 

 

In Citibank v Mayo, Mayo cited "Crestar" to the court, claiming that under 1643b, Citibank had the burden of proof, but in ruling against Mayo, the court said:

 

 

 

He shows that under 15 U.S.C. § 1643(b), the card issuer must prove that the use of the card was authorized, and argues that other jurisdictions have strictly enforced this.Crestar Bank NA v. Cheevers, 744 A.2d 1043 (D.C.App.2000)Michigan Nat'l Bank v. Olson, 44 Wash.App. 898, 723 P.2d 438 (1986). He also argues that if, as alleged by Citibank, this account was opened in 2002, it cannot possibly be governed by a card agreement dated June 2006, an anomaly which he contends defeated Citibank's motion for summary judgment in Citibank South Dakota NA v. Stanford, 42,191 (La.App. 2 Cir. 5/9/07), 956 So.2d 756. Finally, he contends that Ms. Phenix's affidavit was entitled to no weight as she works for a nonparty to the case and did not establish any personal knowledge of the claim, while by contrast his own affidavit swears "that he has never seen these statements prior to this litigation and * * * never used the card to incur any of the charges listed," and hence creates a genuine issue.

 

Citibank concedes its burden of proving authorized use under 15 U.S.C. § 1643(b). It contends, however, that under another provision of the Consumer Credit Cost Disclosure law, 15 U.S.C. § 1666(a), any obligor who wishes to dispute a credit statement must give the creditor, within 60 days of the statement, written notice which "indicates the obligor's belief that the statement contains a billing error and the amount of such billing error[.]" Citibank argues that Mayo never challenged any 963*963 statement; to the contrary, he made many payments and continued using the card. Citibank concludes that it is too late for Mayo to argue that his lengthy credit history was all unauthorized use.

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This is not what happens in the average JDB case.

 

This is potentially the strongest point of the TILA, is that most OC's would have to dig deep for records and testimony to show authorized use.  The JDB has far fewer resources to overcome this threshold, especially if it's a Chase account from 2009-2014.

 

In the New Century Case, they proved an agency relationship, which proved the the charges were authorized.  The plaintiff had sufficient evidence to overcome 1643B.

 

In Citibank v Mayo, citibank also had sufficient evidence to overcome 1643B.

 

Crestar maintains that Mr. Cheevers' "failure to object to the [disputed] charges within a reasonable time, even if not his, constituted ratification and acceptance of those charges," and that under contractual and common law, "if the cardholder fails to notify the bank of any dispute within a reasonable period, he is deemed to have admitted the authenticity of the charges." In essence, Crestar reads into § 1643 a presumption that if the cardholder fails to notify the bank that the disputed charges are not his, they will be deemed to have been authorized by the cardholder. This presumption is at odds with the plain words of § 1643 which impose on the bank the burden to show authorized use of the card, or liability of the cardholder for unauthorized use. As the trial court concluded, nothing in the record demonstrated that Mr. Cheevers authorized the charges on his credit card in November and December 1994

The only other way Crestar could prevail under § 1643(a) is to show that the conditions of liability for unauthorized use of Mr. Cheevers' card have been met: "f the use was unauthorized, then the burden of proof is upon the card issuer to show that the conditions of liability for the unauthorized use of a credit card . . . have been met." 15 U.S.C. § 1643b. Six statutory conditions are imposed upon the card issuer or the bank. See note 5, supra. We agree with the trial court that Crestar did not satisfy at least one of these conditions, § 1643(a)(1)(F)

 

 

You guys are helping prove my point.  The TILA is a threshold protection, in which some OC's & JDB's will have sufficient evidence, and some will not.  It doesn't take away my contention, that people should use this as one of their defenses.  It's good addition, that may or may not prove fruitful.  Leaving it out of your arguments is potentially shooting yourself in the foot.  

 

It's surprising to get so much push back for a statutory protection, which could be beneficial to readers here.  But hey, I'm far from a legal expert!

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This is potentially the strongest point of the TILA, is that most OC's would have to dig deep for records and testimony to show authorized use.  The JDB has far fewer resources to overcome this threshold, especially if it's a Chase account from 2009-2014.

 

In the New Century Case, they proved an agency relationship, which proved the the charges were authorized.  The plaintiff had sufficient evidence to overcome 1643B.

 

In Citibank v Mayo, citibank also had sufficient evidence to overcome 1643B.

 

 

You guys are helping prove my point.  The TILA is a threshold protection, in which some OC's & JDB's will have sufficient evidence, and some will not.  It doesn't take away my contention, that people should use this as one of their defenses.  It's good addition, that may or may not prove fruitful.  Leaving it out of your arguments is potentially shooting yourself in the foot.  

 

It's surprising to get so much push back for a statutory protection, which could be beneficial to readers here.  But hey, I'm far from a legal expert!

 

I don't know about anybody else, but if I had a case this affected I would Throw everything AND the kitchen sink at them..........................The sit back and see how much stuck. One item or 6............matters not to me...............as long as some doodoo sticks.

 

I'm not proud...................just persistent............and I detest JDB's.

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Coffee,

Your thread generated a lot of replies and views.  I am sure consumer lawyers will see if they can use the Chase Consent Order to their advantage.  We will just have to see how it plays out.  Except for Ark, I am not sure how much benefit TILA can be, but it can certainly be pled if a litigant wishes.

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Coffee,

Your thread generated a lot of replies and views.  I am sure consumer lawyers will see if they can use the Chase Consent Order to their advantage.  We will just have to see how it plays out.  Except for Ark, I am not sure how much benefit TILA can be, but it can certainly be pled if a litigant wishes.

 

You're correct, and I hope some of the "good" consumer attorneys take a good shot at Chases accounts, especially the ones owned by a JDB.  My experience with consumer attorneys has not been highly positive, as some seemed uninformed, and lazy, the others only wanted cases that could be a class actions.  Neither of which is helpful for the everyday-consumer.  

 

Many of the Consumer arguments (i.e. TILA) don't have a lot of case law available, but that doesn't mean they are poor arguments, it just means that nobody has challenged that angle in court.  For example, there is no case law in my state regarding the statute of frauds, but this statutes language is a significant threshold to overcome (and most JDBs can't).  What I'm saying to people is:  Don't be deterred by lack of case law regarding a certain subject or argument, it just means that few, if any have argued that angle to the appeals level.  

 

I appreciate everyone's input, and I think it's created a great discussion.  Thanks @debtzapper and @BV80.

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@Coffee_before_tea

 

Actually, there IS Utah case law about the statute of frauds and credit card agreements, going back to "Wells Fargo v. Toronto," a 2008 decision from the UT Court of App.  This is an unreported 2010 decision from the Fourth Utah Judicial District that cites it and  goes into a lengthy discussion of it

 

 

https://www.nclc.org/images/pdf/unreported/Haring.pdf

 

 

From a debt collection White Paper

 

Evidentiary Issues and Statute of Frauds considerations. Generally, under Utah law, every credit agreement is void unless written and signed. Utah Code Ann. § 25-5-4 (f). A debtor or a creditor may not maintain an action on a credit agreement unless the agreement: (A) is in writing, (B) expresses consideration, © sets forth the relevant terms and conditions, and (D) is signed by the party against whom enforcement of the agreement would be sought. But, under Utah Code Ann. § 25-5-4(e), a credit agreement is binding and enforceable without any signature by the party to be charged if: (i) the debtor is provided with a written copy of the terms of the agreement; (ii) the agreement provides that any use of the credit offered shall constitute acceptance of those terms; and (iii) after the debtor receives the agreement, the debtor, or a person authorized by the debtor, requests funds pursuant to the credit agreement or otherwise uses the credit offered. See MBNA America Bank v. Goodman, 140 P.3d 589 (Utah App. 2006).

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You can't cite Haring more than describing how one judge made their decision, it's not binding.  Other than that, the Toronto case is really the only one.  But still, there isn't a lot of cases that show a definitive determination, one way or another. My point is out of the thousands of collection cases each year in UT, you have one (toronto) that was centered around the statute of frauds.  Yet, it still is one of the strongest barriers against a creditor/jdb.

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@Coffee_before_tea

 

I appreciate everyone's input, and I think it's created a great discussion.

 

 

I agree.  While we all may disagree on some issues, a respectful debate can help us learn or come up with new ideas.  You never know what we might come up with when we put together all of our opinions, court rulings, articles, etc.

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@Coffee_before_tea

 

 

I agree.  While we all may disagree on some issues, a respectful debate can help us learn or come up with new ideas.  You never know what we might come up with when we put together all of our opinions, court rulings, articles, etc.

 

Robust argument here is good practice for when we argue in court and are called on to defend and/or oppose positions. 

swordfight.gif

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Robust argument here is good practice for when we argue in court and are called on to defend and/or oppose positions. 

swordfight.gif

I see your a gentleman with finesse in the flay..............white glove and all.

 

                                                                                                                         ::BigGun::

Myself, I'm somewhat crude and believe in over the top in certain case's..... ::BigGun::

                                                                                                                        ::BigGun::

 

When one will do.........cannot 3 totally be better????

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I see your a gentleman with finesse in the flay..............white glove and all.

 

                                                                                                                         ::BigGun::

Myself, I'm somewhat crude and believe in over the top in certain case's..... ::BigGun::

                                                                                                                        ::BigGun::

 

When one will do.........cannot 3 totally be better????

@saytar

 

It depends on your arguments...

shield-emoticon-skype.gif

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@saytar

 

Only if the guns are loaded.

 

Shhhhhh....Poker hand......classified info,,,,,,,don't get them looking at ALL the Cylinder's!!  :ROFLMAO2:

 

Gotta keep the wizard hidden behind the curtain........... xwizardx

 

 

 

Never hurts to interject a little (ok a lot) humor into some of the things we deal with......................keeps the boat from taking on too much water!

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Heres another one.  Yep, we did a big bail out so they could afford the fines lol.

 

July 21, 2015
 
CONSUMER FINANCIAL PROTECTION BUREAU ORDERS CITIBANK TO PAY $700 MILLION IN CONSUMER RELIEF FOR ILLEGAL CREDIT CARD PRACTICES

Millions of Consumers Harmed by Bank’s Deceptive Marketing and Unfair Billing of Credit Card Add-On Products and Services, and Other Unlawful Practices
 
WASHINGTON, D.C. — The Consumer Financial Protection Bureau (CFPB) has ordered Citibank, N.A. and its subsidiaries to provide an estimated $700 million in relief to eligible consumers harmed by illegal practices related to credit card add-on products and services. Roughly 7 million consumer accounts were affected by Citibank’s deceptive marketing, billing, and administration of debt protection and credit monitoring add-on products. A Citibank subsidiary also deceptively charged expedited payment fees to nearly 1.8 million consumer accounts during collection calls. Citibank and its subsidiaries will pay $35 million in civil money penalties to the CFPB.
 
“We continue to uncover illegal credit card add-on practices that are costing unknowing consumers millions of dollars,” said CFPB Director Richard Cordray. “In our four years, this is the tenth action we’ve taken against companies in this space for deceiving consumers. We will remain on the lookout for similar conduct and will address it as we find it.”
 
Citibank, N.A. is a national bank and insured depository institution. Citibank, as well as its subsidiaries Department Stores National Bank, and Citicorp Credit Services, Inc. (USA), marketed or offered credit card add-on products to consumers nationwide. From at least 2003 through 2012, Citibank actively marketed and enrolled consumers in five debt protection add-on products: “AccountCare,” “Balance Protector,” “Credit Protection,” “Credit Protector,” and “Payment Safeguard.” These products promised to cancel a consumer’s payment or balance, or defer the payment due date, if the consumer experienced certain hardships, such as job loss, disability, hospitalization, and certain life events, such as marriage or divorce. Citibank also marketed and sold other add-on products – “IdentityMonitor,” “DirectAlert,” “PrivacyGuard,” and “Citi Credit Monitoring Services” – that offered credit-monitoring or credit-report-retrieval services. Citibank also offered “Watch-Guard Preferred,” a wallet-protection service that notified credit and debit card issuers if the consumers reported a card lost or stolen.
 
Deceptive Marketing

The Bureau found that Citibank or its service providers marketed these products deceptively during telemarketing calls, online enrollment, “point-of-sale” application and enrollment at retailers, or when enrolled consumers later called to cancel certain products. For example, confusing text on pin-pad offer screens at the point of sale increased the likelihood that consumers applying for credit cards at a retailer would not realize they were both applying for credit and purchasing debt-protection coverage. These illegal practices affected an estimated 4.8 million consumer accounts. Among other things, Citibank’s misleading or illegal marketing or retention practices included:
 
Misrepresenting cost and fees for coverage: In some cases, telemarketers misrepresented or did not inform the consumer about the cost of the products. In certain telemarketing scripts, Citibank instructed telemarketers to claim a blanket “free” 30-day trial period, when Citibank still charged consumers during the initial 30 days of membership. In other instances, Citibank failed to inform consumers that they would be billed after the 30-day trial period if they did not cancel the product. Citibank also told some consumers they could avoid the fee by paying their balance in full by the due date. But to avoid the fee, consumers had to pay off the balance before the end of their billing cycle so that there would be no balance on the account when billing statements went out.
 
Misrepresenting benefits of some products: For consumers who signed up for a credit-monitoring product, Citibank claimed the fraud alert service on credit card accounts would alert them of fraudulent purchases. In fact, the credit-monitoring product only provided alerts to changes in a consumer’s credit file maintained by major reporting companies, not at the transaction level. Citibank also misled consumers in telemarketing calls and in online marketing about the credit score benefit. It told consumers the credit score was generated from all the three major credit reporting companies, when in reality the score was generated by a third-party vendor.
 
Illegal practices in the enrollment process: During telemarketing calls, Citibank’s nonbank subsidiary, Citicorp Credit Services, Inc. (USA), used illegal practices to enroll consumers in these products. That company used leading questions to obtain billing authorizations from consumers for certain add-on products. It also enrolled some consumers without any billing authorization or by construing ambiguous responses during calls for a billing authorization as permission for enrollment, and then charged consumers for the products.
 
Misrepresenting or omitting information about eligibility for coverage: In some instances, consumers disclosed information to Citibank indicating that they would be ineligible for certain benefits. However, Citibank failed to inform them that they would be ineligible to receive the product benefits and still enrolled them in the product.
 
Unfair Billing Practices

Under federal law, in order for Citibank or its vendors to obtain consumers’ credit information to provide the credit-monitoring or credit-report-retrieval services for certain add-on products, consumers generally must authorize access to that information. In many instances, however, Citibank billed consumers for these products without having the authorization necessary to perform the credit-monitoring and credit-report-retrieval services. In other cases, Citibank or its vendors could not provide the promised services for other reasons, such as when the consumer’s information could not be found in the consumer reporting companies’ files. As a result, Citibank:
 
Charged consumers for benefits they did not receive: Citibank charged consumers whose authorizations were not in order or who could not receive the credit monitoring or other benefits. The company continued to charge consumers for services they were not receiving, in some cases for the entire time the consumer had the product.
 
Failed to provide product benefits: Consumers may have been under the impression that their credit was being monitored for fraud and identity theft, when, in fact, these services were either not being performed at all, or were only partially performed.
 
Citibank engaged in these unfair billing practices from at least 2000 through 2013. About 2.2 million consumer accounts were improperly billed product fees while not receiving the full product services.
 
Deceptive Collection Practices

When collecting payment on delinquent retailer-affiliated credit card accounts, Citibank offered consumers the option to pay by phone using a checking account, so the payment would post to the account on the same day. There was a $14.95 fee associated with using this option. Citibank misled consumers by not disclosing the purpose of the expedited payment fee. It misrepresented the payment fee as a “processing” fee and did not explain that the fee was to post payment to the account on the same day it was made rather than a fee to allow payment. Citibank also failed to disclose other no-cost payment alternatives. The company charged the fee even though it was rarely in the consumer’s interest to pay the fee so that the payment would post on the same day.
 
Enforcement Action

Pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act, the CFPB has the authority to take action against institutions engaging in unfair, deceptive, or abusive practices, or other violations of federal consumer financial law. This is the tenth action the Bureau has taken against companies for illegal practices in the marketing or administration of add-on products and services. The CFPB’s order requires that Citibank:
 
Provide $700 million in relief to roughly 8.8 million consumer accounts: Citibank must provide approximately $479 million in consumer relief to about 4.8 million consumer accounts as a result of the deceptive marketing or retention practices. It also must pay approximately $196 million to roughly 2.2 million consumer accounts that enrolled in the credit monitoring products and were charged while Citibank did not perform all of the promised services. Department Stores National Bank must provide about $23.8 million in consumer relief to almost 1.8 million consumer accounts for charging expedited payment fees on these delinquent accounts.
 
Conveniently repay consumers: Citibank will reimburse consumers affected by these practices. Consumers who are eligible for a refund do not have to take any action to get their refund. For the unfair billing practices related to the credit-monitoring products, Citibank has completed reimbursement to eligible consumers. For eligible consumers who have not received refunds yet, Citibank will initiate and complete a remediation process to reimburse those consumers.
 
End unfair billing practices: Consumers will no longer be billed for the credit monitoring products if they are not receiving the promised benefits.
 
Cease engaging in illegal practices: Citibank is prohibited from marketing all add-on products by telephone or at the point of sale, or engaging in attempts to retain consumers in these products by telephone, until it submits a compliance plan to the CFPB.
 
Pay a $35 million penalty: Citibank will make a $35 million penalty payment to the CFPB’s Civil Penalty Fund.
 
The CFPB is taking this action in coordination with the Office of the Comptroller of the Currency, which is separately ordering a $35 million civil penalty and restitution from Citibank and Department Stores National Bank for some of the same illegal practices.
 

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And the Fraud keeps on Rolling...................................................

 

Talk about a "gift" that keeps on giving......................and taking. A reverse Robin Hood.....take from the poorest and give to the richest...................

 

When Banks are too Big to Fail or Jail and own the politician's lock stock and barrel.....................................is called "crony capitalism" or by the old misnomer...........FASCISIM.------ Benito Mussolini would be proud.

 

First the Banks managed to write their own creditor friendly BK law, paid the politicians to pass the Law they wrote...............then, making sure that even under BK they'd get something in most case's....... they double down on putting the debt cards in the Publics Pocket.

 

Now the new con is calling Health Care a TAX............................forcing private citizens to purchase a product from for profit business.............

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My apologies if similar questions have already been answered in the thread, I am new here and didn't read through every post  because there is quite a bit of jargon here that I am not familiar with. Anyhow...

I have a default judgement on a Chase credit card that I stopped paying on in 2009, and it is for nearly $12,000.  It was filed with the court in CA in mid-2010 .   Chase has never taken any actions on this judgement, which I thought was strange but figured it was just due to my low income (single mom, went back to school, income is next to nothing now). I just today found out about the CFPB action against Chase, so I went through my paperwork and the verification was signed by Ruben Alcaraz, with just a single letter for the signature.  Apparently he was one of the "most prolific affidavit signers" for Chase., and implicated in the robosigning issue, so it looks as though I may be one of the 528,000 included in the judgement against Chase.

 Can someone explain to me what I should expect? Am I really "off the hook", or can they sue me again?  Can they renew the judgement when it expires in a few years?  Also, the judgement shows up on my Experian credit report, but not on the other two.  Can I use the judgement against Chase to  get this removed?

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