Congress Blasts JPMorgan for Military Foreclosures…and Suicides
Friday, February 11, 2011
Lawmakers on the House Veterans Affairs Committee excoriated JPMorgan Chase for charging soldiers more interest on their mortgages than allowed under federal law, causing many families to lose their homes, and perhaps even their lives.
As far as Representative Bob Filner (D-California) was concerned, it’s possible some of the recent suicides by military personnel might have been brought about by financial troubles stemming from JPMorgan’s actions.
“I would call it homicide,” said Filner, the committee’s ranking member, to JPMorgan’s executive vice-president of consumer practices, Stephanie Mudick, during a hearing on February 9. “You broke the law. How are we going to hold you accountable? Everything is impersonal. Nobody is ever responsible and yet these people’s lives are turned upside down. You can’t just apologize...and then, this is over.”
The bank charged more than the 6% interest that financial institutions are allowed to bill homeowners on active duty. Mudick blamed the overcharges on coding mistakes and told the committee her bank had restored about 18 families to foreclosed homes, and that it would distribute $2.4 million in refunds to approximately 4,500 servicemembers who were overcharged. Mudick said the bank added 7.5% interest on the refunds, which will translate to about $70 per person.
Republican Representative Cliff Stearns of Florida called the refund amount “a mere pittance” given the suffering endured by soldiers and their families. Stearns also pointed out that JPMorgan received a $25 billion bailout from the federal government during the financial crisis.
When Mudick claimed that bank staff had trouble calculating interest based on when a servicemember is called up for active duty, Rep. Tim Walz (D-Minnesota) angrily pointed out that the Chase credit card agreement is 63 pages long, while the military order ordering servicemembers to active duty is only one page.
Congress Blames Bank for Troop Suicides (by Bryant Jordan, Military.com)
J.P. Morgan Apologizes for Military Foreclosures (by Maya Jackson Randall, Wall Street Journal)
JPMorgan Chase Advised Homeowners to Stop Making Loan Payments…and Then Foreclosed (by Noel Brinkerhoff, AllGov)
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