There is an option to opt out, but most of you won’t like it.
In the past few years, Chase has ramped up the attractiveness of their credit cards, providing their cardholders with a smorgasbord or perks and points. This lured in many new applicants, and led to Chase being the undisputed front-runner in the credit card industry.
However in recent months, Chase customers started receiving emails stating unexpected changes to their user agreements which stripped their right to sue Chase, should they choose to.
The bank updated all their credit card contracts to include a “binding arbitration” clause, which requires customers who have a dispute with the bank to settle through private arbitration, which essentially prevents the formation of class-action lawsuits.
Instead of joining a class action suit, consumers with disputes would have no recourse but to take their chances in a private lawsuit, which experts say heavily favor the corporations and not the consumers.
The bank is updating all but one class of their credit cards, the AARP line, based on their existing contract with the group.
The revised agreement states that “With arbitration, you cannot go to court, have a jury trial or initiate or participate in a class action for your disputes with the bank. In arbitration, disputes are resolved by an arbitrator, not a judge or jury, and procedures are cimpler and more limited than rules applicable in court.”
To opt out of the agreement, cardholders must send a physical letter to Chase by August 9th with account numbers, addresses and signatures of all the cards they own, explicitly stating that you “reject this agreement to arbitrate”. These letters must also be mailed to Chase at PO box 15298, Wilmington, DE 199850-5298.
As part of a strategy, Chase is not allowing their customers to opt out online despite the fact that they tout their online services as well as their mobile apps as being so convenient you can apply for a credit card, cancel cards, pay off card balances, and receive paperless statements online.
Chase benefits from this new agreement as it shields the company from class-action lawsuits. In a statement released to Yahoo Finance, Chase states that there is no online version of this opt out agreement as the company wants “to make sure we captured our customers’ preferences accurately.”
Chase cards used to have these provisions and actually dropped forced arbitration clauses in their agreements in 2009 after a settlement.
A Chase spokesperson who declined to be named said “Our experience in Consumer banking has been that it’s often faster, easier and less expensive,” referring to forced arbitration.
