According to the InsideARM article posted below, former assistant vice president Linda Amonte alleges that Chase had about 5,000 accounts with incorrect balances and did not have the court documentation for some 11,000 accounts with judgments that the bank said it had, misrepresenting those accounts to potential debt buyers.

This is NOT the first time I’m writing about a lawsuit over a bank misrepresenting debts.   There has been litigation by a debt buyer and as I recall, the bank prevailed.  I don’t like debt buyers, but I like the big banks even less.  The banks have the power, own most courts.

You can imagine how banks misrepresent debts to CONSUMERS who they expect to be broke, depressed and financially illiterate.

Amonte alleges that she was relieved of her duties after she refused to participate in the sale of the portfolio of more than 23,000 delinquent accounts with a value of more than $200 million.

Here is the article:

Former Chase Exec Makes Debt Sales Allegations in Lawsuit

March 10, 2010

An assistant VP with Chase claims that she was fired after she raised some issues with the way the bank was representing a credit card debt portfolio for sale.

by Phil Britt
insideARM
March 10, 2010

A former assistant vice president with JP Morgan Chase has filed a lawsuit against her old employer claiming, among other things, that the credit card unit misrepresented information about a portfolio of card debt for sale.

In a suit filed in Bexar County (Texas) District Court, Linda Amonte alleges the bank had about 5,000 accounts with incorrect balances and did not have the court documentation for some 11,000 accounts with judgments that the bank said it had, misrepresenting those accounts to potential debt buyers.

Amonte, team leader in the bank’s credit services division in San Antonio, said she was in charge of auditing the accounts, but couldn’t confirm some of the judgments or balances, causing her to question the values with her immediate superior.

The lawsuit alleges that she went above her supervisor to another level of the bank’s management, and “made it clear she would not participate” further with the attempt to sell the portfolio, which included more than 23,000 delinquent accounts with a value of more than $200 million, according to the lawsuit. Almonte alleges in the lawsuit that she was relieved of her duties in November of last year as a result of her actions.

Debt buyers typically conduct due diligence of their own to confirm the value of a portfolio before completing a deal. But sometimes those values and account ownership are difficult to determine.

Greg Ousley, CEO of Global Debt Registry, said his firm was founded to provide a third party data validation solution, as well as chain of title origination and management, for all of the global banks. This type of solution would prevent issues like the one Almonte alleges.

But debt buyers are typically protected through warranties made on the portfolios when purchased. This allows buyers to put back – or a seller to buy back — certain accounts that are later found to be bankrupt, deceased, or lack information stipulated in the sales contract.

Almonte’s attorney, John Bruster “Bruse” Loyd of Houston, said that all charges in the lawsuit are allegations at this time and that the discovery process will help determine if any of the charges are true.

A Chase spokesman told insideARM the bank doesn’t comment on pending litigation.

No court date has been set on the case. Almonte is requesting a jury trial and seeks unspecified damages.

I expect Chase to SETTLE to avoid the bad publicity.

And it is so unfortunate that MANY consumers will pay or settle these debts without ever receiving documentation.

Filed under: Almonte v Chase, litigation and tagged fraud, JP Morgan Chase, litigation