A class-action lawsuit accusing JPMorgan Chase of overcharging customers using their credit cards to purchase cryptocurrencies has been settled out of court.
Plaintiffs Brady Tucker, Ryan Hilton and Stanton Smith notified the U.S. Southern District Court in New York they reached a settlement with the defendant, Chase Bank. As per a court order signed by Judge Katherine Polk Failla dated March 10, the proceedings have now been discontinued.
The class action was first brought in April 2018, when Tucker complained Chase had charged him more than $160 in fees and interest for regularly purchasing cryptocurrencies from Coinbase using his credit card.
Tucker accused the bank of violating the Truth in Lending Act for not informing customers that crypto purchases were being treated as “cash advances,” which incur higher fees. He also complained the bank refused to refund the charges to affected customers.
“[T]he complete lack of fair notice to Chase’s cardholders caused them to unknowingly incur millions of dollars in cash advance fees and sky-high interest charges on each and every crypto purchase,” reads the original complaint.
The bank did not charge similar fees for purchases made on debit cards.
In February 2018, Chase, like some other U.S. consumer banks, banned users from purchasing crypto on their credit cards. Even though JPMorgan revealed its own blockchain-based settlements solution and “JPMCoin” token in 2019, the ban on crypto purchases on credit cards has not been lifted.
Details of the settlement have not been disclosed. The plaintiffs have 75 days from the date of the court order to resume proceedings.
Chase Bank did not immediately respond to requests for comment.