Chase Collections on Your Credit Report: Your Options Explained

If Chase has appeared on your credit report as a collection or charge-off, one critical fact shapes every response strategy: a 2015 enforcement action by the CFPB and 47 state attorneys general found Chase sold hundreds of thousands of “zombie debts” that had already been settled, paid in full, or discharged in bankruptcy.

Chase was permanently barred from collecting on over 528,000 accounts and required to pay $166 million in penalties and consumer relief.

If your account falls in the 2009-2014 timeframe, it may be among those 528,000 accounts Chase is prohibited from collecting on. This guide covers how Chase’s collection process works and how to respond.

How Chase Collections Actually Work

Chase handles delinquent accounts in stages, similar to other major banks.

During the first stage, Chase’s internal collections team contacts you while the account is still on Chase’s books. The most flexibility for payment arrangements and hardship programs exists here.

In the second stage, Chase assigns the account to a third-party collection agency that collects on Chase’s behalf. Known agencies used in this role include CBE Group and LTD Financial Services. FDCPA protections apply fully to these third-party collectors even though they don’t apply directly to Chase as the original creditor.

In the third stage, Chase may sell the charged-off account outright to a debt buyer who then takes full legal ownership. Chase’s post-2015 consent order prohibits debt buyers from reselling Chase accounts, which means once Chase sells your debt it stays with that buyer.

The 2015 CFPB Enforcement Action

On July 8, 2015, the CFPB and attorneys general from 47 states and the District of Columbia entered a consent order against JPMorgan Chase for two major violations spanning 2009 to 2014.

First, Chase sold “zombie debts” to third-party debt buyers. These were accounts that had already been settled by agreement, paid in full, discharged in bankruptcy, identified as fraudulent, subject to a payment plan, no longer owned by Chase, or otherwise uncollectable. Consumers whose debts had already been resolved found collectors pursuing them again because Chase had sold their resolved accounts.

Second, Chase filed more than 528,000 debt collection lawsuits and provided more than 150,000 sworn statements to debt buyers using robo-signed documents. Employees were signing court documents en masse without reviewing individual accounts.

The settlement required Chase to permanently cease all collection efforts on 528,000 consumer accounts, pay $50 million in consumer restitution, pay $136 million to 47 states, and pay $30 million to the CFPB.

Was Your Account Among the 528,000?

If your Chase credit card account was sent to collections litigation between January 1, 2009 and June 30, 2014, it may be one of the accounts Chase was permanently barred from collecting on. Indicators include receiving lawsuits or collection demands from Chase during that period, receiving a court judgment from Chase during that period, or believing you settled or paid a Chase account but still having it pursued.

Contact the CFPB at consumerfinance.gov to check whether your account qualifies for relief under the 2015 consent order.

The 2013 Unfair Billing Action

In 2013, a separate CFPB action required Chase to refund approximately $309 million to more than 2.1 million customers for unfair billing practices related to credit card add-on products such as payment protection and credit monitoring.

If you had a Chase credit card between 2005 and 2012 and were enrolled in any add-on product you did not clearly authorize, and a balance from that period is still on your credit report, the billing practices underlying that balance may be worth disputing.

Who Is Currently Reporting the Account?

Pull your credit reports from AnnualCreditReport.com and identify who is listed as the current creditor. If Chase is listed, they likely still own the account. If a third-party name appears as the current creditor, the account has been sold. The FDCPA applies to the third-party collector but not to Chase’s internal collections team. The FCRA applies to Chase directly.

Check for duplicate reporting: an account should not appear under both Chase and a third-party collector as two separate negative entries for the same underlying balance.

What You Can Do If the Account Has Been Sold

If Chase sold your account to a debt buyer, request complete documentation before paying:

• The original Chase account number and the balance at charge-off.
• Confirmation the account has not already been settled or paid.
• The complete chain of ownership from Chase to the current buyer.
• Confirmation the debt is not among the 528,000 accounts Chase was barred from collecting on.

Given the CFPB’s finding that Chase sold settled, paid, and bankruptcy-discharged accounts, documentation verification is especially important on Chase debt that has changed hands.

What Chase Cannot Do

Chase itself, as the original creditor collecting internally, is not subject to the FDCPA. The Fair Credit Reporting Act (FCRA) applies to Chase’s direct reporting. Under the FCRA, Chase cannot report inaccurate information, must investigate disputes, and must correct errors. Third-party collectors and debt buyers working with Chase accounts are fully subject to FDCPA protections.

Your Options for Resolving a Chase Account

Your strategy depends on where the account currently sits:

• Still with Chase internally: Contact Chase directly. They offer hardship programs and sometimes goodwill adjustments on newer accounts. The customer service number for credit card collections is (800) 432-3117.
• With a third-party contingency collector: Full FDCPA protections apply. Request validation and verify the balance with Chase before paying.
• Sold to a debt buyer: Demand complete documentation. Negotiate a settlement. Given Chase’s history of selling inaccurate debt, documentation gaps are a legitimate defense.
• 2009-2014 collection litigation account: Contact the CFPB to check whether the account qualifies for permanent collection cessation under the consent order.
• Dispute if inaccurate: If the account was settled, paid, or discharged in bankruptcy before being sold, dispute with each credit bureau and file a CFPB complaint.

How to Contact Chase About a Collection

• Chase credit card collections: (800) 432-3117
• Chase general customer service: (800) 935-9935
• Chase mailing address: JPMorgan Chase Bank, N.A., 270 Park Ave, New York, NY 10172

Bottom Line

Chase’s 2015 consent order is one of the largest debt collection enforcement actions in CFPB history. If your Chase account involves a 2009-2014 collection lawsuit, it may be among the 528,000 accounts permanently barred from collection. Check with the CFPB before paying anything on an older Chase account.

For newer accounts, the same verification and documentation strategies apply. Never pay on a Chase account a debt buyer claims to own without confirming the debt was not already resolved.