Cuomo reaches $4.4M agreement with Chase over credit card fees

Chase Bank USA will stop charging a $10 a month service charge that it added to more than 184,000 credit card accounts, New York Attorney General Andrew Cuomo said.

Chase Bank, which is the credit card-card issuing subsidiary of J.P. Morgan Chase & Co., will also refund consumers more than $4.4 million.

Cuomo said that in the past, Chase offered cardholders promotional rates for balance transfers or other loan amounts, usually for a one-time transaction fee, about 3 percent.

But in November, Chase notified more than 300,000 cardholders that the previous terms had been changed. Beginning in January, Chase said, it would charge a flat fee of $10 a month, or $120 a year.

“My office will not sit back and allow banks to promise one thing in its solicitations and agreements with consumers, and then when times get tough, change the deal, leaving consumers holding the bag,” Cuomo said.

Chase will be sending letters to consumers, including thousands in New York, telling them that beginning April 1, Chase will stop adding the $10 monthly fee. Cuomo said consumers will save about $22 million in the next 12 months.

Chase spokesman Joseph Evangelisti said the company "decided to discontinue this practice because of customer feedback."