Idaho resident Brady Tucker takes on the banking giant JPMorgan Chase by the horns and demands for justice in his case of inexplicable fees for cryptocurrency purchases. This lawsuit is really important for the crypto community, as an important bank can potentially pay for its untransparent and oppressive policies in regards to the purchase of cryptocurrencies.
On April 10th 2018, an Idaho resident named Brady Tucker has filled a court lawsuit against JP Morgan Chase (Chase Bank USA) in order to demand damage charges and statutory damages of $1 million.
According to the data presented, Mr. Tucker has paid about $164 in fees while making cryptocurrency purchases on Coinbase. The issue concerns many other US citizens who have been using Chase Bank credit cards to buy cryptos before February 2nd 2018 (the date when these exchanges were officially prohibited due to market volatility).
On the surface, this is good publicity for cryptocurrencies and it's great that enthusiasts from this space stand their ground and defend their rights by opposing the arbitrary taxation which wasn't even part of the credit card contract.
But on the long term, unless the plaintiff manages to win this important battle, we might expect many more banks to ban cryptocurrency purchases on their credit cards or feature intentionally-abusive clauses in the contracts just to cover themselves from a legal standpoint and keep on collecting fees.
Violation of the US Truth in Lending Act
However, we're talking about a seemingly-rightful violation of the US Truth in Lending Act, which clearly states that credit card issuers should notify their customers in writing about any changes that occur to the contractual terms. Chase Bank has most likely used these extra fees as a form of deterrence and intimidation - because clients who discover the high fees for cryptocurrency purchases will think twice about using the same credit card on crypto exchanges for a second time.
But Brady Tucker has definitely made a bold and smart decision to go against the financial giant and demand for justice, as he seems to possess the legal arguments and will definitely generate a louder debate on the unfair banking practices targeted at cryptocurrency users. If he wins it would set a precedent that banks can’t bully cryptocurrency enthusiasts that wish to hold wealth outside of the dominant banking system.
Laws in common law systems can be made on the basis of judicial precedents. If the judge acknowledges that this is an infringement of the contractual provisions for the credit card, then we will see JP Morgan Chase swallow their pride and take a step back from their assault on the credibility of cryptocurrencies, but also gain a new legitimate mean to defend the freedom to purchase cryptocurrencies.
If won no bank which allows clients to buy cryptocurrencies via credit card will be allowed to impose sneaky fees without an explicit contractual agreement.
And this can go two ways: in the best-case scenario, banks stop imposing crypto fees for credit card purchases; but in the worst one (which is more likely to happen), they either ban the purchase of cryptocurrencies altogether or act as financial cartels to establish standard fees to which all customers have to comply.
While this shapes up to become a major victory for cryptocurrencies, we must remember that using these digital assets is not in the best interest of any existing bank. That's why it's very likely that these financial institutions will backfire with bigger fees which are clearly stipulated within the contractual terms of service. Regardless it could set a precedent for cases to come in the battle of the banks vs crypto. Who knows what impact on the rest of the world that will have?