Winning the hearts and minds of newly released inmates from federal prison may have been the goal of JPMorgan Chase when it inked a deal to provide them with debit cards, but that strategy seems to be imploding with the financial giant having to fork over hundreds of thousands of dollars in fees associated with the cards.
According to a report covering a court filing, JPMorgan Chase agreed to shell out $446,822 to ex-cons as part of a settlement in a class action lawsuit that pitted thousands of ex-prisoners against JPMorgan, in which the prisoners claiming the bank took advantage of their situation by charging them $10 to withdraw money from a bank teller and $2 for using an ATM that wasn’t part of its network. JPMorgan also agreed to pay as much as $250,000 in attorney fees for the plaintiffs. Since the $446,822 will be split between nearly 50,000 ex-prisoners, none are expecting to get rich. But one did say in a report it was more about the principle rather than a payout.
The ex-prisoners said in the complaint that JPMorgan’s deal with the Federal Bureau of Prisons was nothing more than a scheme designed to exploit people as they are released from federal prisons around the country, noting that they need every cent possible to get back on their feet.
JPMorgan won a no bid contract years ago and, according to the complaint, all federal prisoners in the U.S. since at least 2008 were required to get Chase debit cards to get the remaining balances in their accounts. That includes money sent from family and friends and wages earned during their stint in jail. The ex-prisoners said they weren’t allowed to look at or approve the terms of the cards, which resulted in the excessive fees.