In a time where some of the major Wall Street banks are in the news regarding their attitude and uses of crypto, JP Morgan has reportedly said they are going to settle a class-action lawsuit to the tune of $2.5 million after they were found to be overcharging customers for buying cryptocurrencies using Chase credit cards, classifying the purchases as cash advances.
By treating these payments as cash advancements there came a higher fee for the customers and so, a class-action lawsuit was filed in 2018 and was settled out of court this year. But, this settlement sees JP Morgan admitting no wrongdoing. JPMorgan Chase has agreed to pay $2.5 million to settle the lawsuit, noting:
“Plaintiffs said the settlement would result in class members getting about 95% of the fees they said they were unlawfully charged.”
Plaintiff, Brady Tucker, claims that the bank violated the Truth in Lending Act since they did not inform customers that cryptocurrency purchases were being treated as cash advances. Tucker explained that the bank charged him more than $160 in fees and interest for regularly purchasing cryptocurrencies from Coinbase with his credit card and refused to refund the charges.
JP Morgan has famously been associated with cryptocurrency in a negative way when the CEO of the bank at the time. Jamie Dimon called bitcoin “a fraud” but later admitted to CNBC that he regretted doing so.
Coming a long way
Since that call from Dimon, JP Morgan has made some progressive steps with cryptocurrency and even created its own version of a cryptocurrency and more recently it added an exchange feature too.
This appears to be the trend with the softening of views on crypto from the major banks and other institutions, however, there are still some major exceptions. Also this week, another big bank in Goldman Sachs, spelt out its view on Bitcoin and told its investors that the coin was not an asset class.
This is very much in opposition to the way in which Bitcoin has been taken up predominantly as it is one of the best performing assets of the decade and yet this spells a poor understanding from a major bank in a time where there is a need for a new asset class.