Published on:

Employee Blows the Whistle on JP Morgan Chase’s Alleged Fraudulent Debt Collection Practices

above-the-bar-logo-no12.jpgQ: I work for a major financial bank that has been in a mad rush to sell off credit card debt as well as delinquent mortgages to collection agencies. I have personally observed that many of these personal loan accounts contain gross inaccuracies. When I complained to my manager about the errors, he told me to leave it alone and that it didn’t matter. Should I do something about this?

A: This is a great question because credit card debt and the mortgage issue are very much connected to the state of our economy. This in turn affects all taxpayers when the government has to step in and bail out huge banks and financial institutions with taxpayer monies.

Our attorneys at Villanueva & Sanchala have been tracking a recent whistleblower case by a former JP Morgan Chase (“Chase”) employee, Linda Almonte (“Almonte”), that alleges that Chase engaged in illegal practices with its credit card debt practices. Almonte originally filed suit against Chase for wrongful termination.

Almonte was a mid-level executive who supervised employees in the credit card litigation department. She claimed that she was fired because she refused to participate in the sale of 23,000 credit card accounts that had a face value of $200 million that Chase packed for sale. Almonte claimed that 5,000 of the accounts listed the wrong amount owed and thousands had other problems. Chase was unloading the debt at about 13 cents on the dollar in order to net $26 million.

Almonte complained to her manager as well as to Chase attorneys. However, she was fired refusing to participate in fraudulent behavior. Almonte added her whistleblower suit alleging that Chase violated the law by selling hundreds of millions of dollars worth of credit card debt to 3rd party debt buyers knowing that many of the accounts were incorrect and overstated. She also charged Chase with routinely destroying information and communications from customers instead of putting it in their customer files. Almonte filed a whistleblower complaint with the Securities and Exchange Commission (“SEC”). If you have any questions about how to blow the whistle in your workplace, call one of our New York Whistleblower Attorneys for a confidential consultation at (800) 893-9645.

Almonte noticed and reported a huge problem being committed by major banking institutions. According to the Federal Trade Commission’s report on this subject “Repairing a Broken System,” banks are selling information full of errors. Finance institutions and banks have always been selling credit card debt packaged in huge portfolios for pennies on the dollar. These debt buyers then engage in various tactics including hiring debt collectors, letters, phone calls, and lawsuits to collect the debt.

In this day and economy, it is an outrage that banks and financial institutions have the nerve to sell inaccurate debt information. Kudos to Almonte for standing up to JP Morgan and exposing its fraudulent behavior. Perhaps if we had more whistleblowers like Almonte, we could have avoided the mortgage crises and saved taxpayers millions of dollars that were spent to bailout financial institutions. Almonte is a great example to anyone observing fraud being committed against the government. If you have any questions about blowing the whistle, call us at (800) 893-9645 for a confidential consultation.


Thank you for visiting our Blog. This blog provides general information and thoughts about various employment law issues primarily in the New York Tri-State area and occasionally in other areas. You are welcome to read the posts. However, do not construe any content on this blog as legal advice or the creation of an attorney-client relationship. Again, we provide the content only for informational purposes. You should not make decisions based information on our blog since the application of the law depends on the facts and each situation may be different. In addition, the law in most jurisdictions is different and changes constantly and we make no representations that any information on our blog has been updated. The Blog should not be used as a substitute for competent legal advice from an experienced employment law attorney in your state or jurisdiction.

Web Sources:

Debt Collectors Face a Hazard: Writer’s Cramp, NY Times, Oct. 31, 2010 Repairing a Broken System, Federal Trade Commission, July 2010

Contact Information