JP Morgan Chase sued thousands of Sacramento-area customers as part of what California Attorney General Kamala Harris calls a barrage of inadequately researched debt collection cases.
Harris sued the banking giant Thursday, contending that it haphazardly filed about 100,000 debt collection lawsuits between 2008 and 2011 in California.
"(Chase) cut corners in the name of speed, cost savings, and their own convenience, providing only the thinnest veneer of legitimacy to their lawsuits," the state said in its complaint.
In just one 15-week period in 2011, Chase filed more than 400 lawsuits in Sacramento Superior Court. On one day alone Jan. 5, 2011 Chase filed 32 lawsuits here.
Harris' office contends the bank "robo-signed" legal documents without reviewing evidence or considering the merits of the debt collection cases. Her office is seeking damages for borrowers and a ban on the allegedly illegal practices.
Chase Bank spokesman Paul Hartwick told The Bee on Friday that the bank "will continue to cooperate with the AG's office on this matter."
He added that the bank performed a review of its debt collection procedures in early 2011 and stopped filing credit card lawsuits.
Sacramento Superior Court records support that claim. The bank filed fewer than 25 lawsuits in Sacramento Superior Court in 2012, with many related to contract disputes or property.
JP Morgan Chase is also under pressure from state and federal energy regulators for its behavior in California. Earlier this week, the firm took steps to retreat from the state's power market when it obtained approval from the California Public Utilities Commission to sell its rights to electricity from three plants in Southern California.
In November, the Federal Energy Regulatory Commission suspended JP Morgan's right to trade electricity for six months for submitting false information to regulators. The case was an outgrowth of an ongoing investigation into Morgan's bidding practices in California.
Call The Bee's Phillip Reese, (916) 321-1137. The Bee's Mary Lynne Vellinga contributed to this report.