Financial giant JPMorgan Chase & Co, is being sued by one of its customers for “surprise fees” the customer incurred while purchasing cryptocurrency.
In the case Brady Tucker et al v Chase Bank USA filed with a Manhattan federal court, JP Morgan Chase is accused of charging Tucker with extra fees and higher interest rates on cryptocurrency purchases. Starting in January, JP Morgan Chase and other banks began treating cryptocurrency purchases as cash advances, resulting in significant costs above and beyond what the customer anticipated.
Tucker, an Idaho resident, incurred over $143 in fees and over $20 in unexpected interest charges for five separate cryptocurrency purchases between January 27 and February 2.
Tucker says he called Chase’s customer service to dispute the charges, but the bank refused.
According to the US Truth in Lending Act, credit card issuers are mandated to notify customers in writing of any changes to their policy's terms. Considering the company’s large customer base, Tucker also says that possibly hundreds or thousands of customers were affected by the unannounced policy change.
The lawsuit is asking for damages to the tune of $1 million.
A spokesperson for Chase would not comment on the lawsuit itself, but said the bank stopped processing purchases of crypto made with credit cards on February 3 due to the credit risk involved. Chase also confirmed that debit cards can currently still be used to purchase crypto without interest or cash advance fees.
During bitcoin’s meteoric rise at the end of 2017, many investors used credit cards to purchase cryptocurrencies, only to have their value plummet in early 2018, leaving investors with a large credit card bill. The occurrence led to many banks blocking cryptocurrency purchases, or charging exorbitant fees. In addition to JP Morgan Chase, Citigroup, Virgin Money, Lloyds Banking Group, and others have all banned the purchase of cryptocurrency via credit cards across the US and UK.