Chase Switches Me To Paperless Billing, Without My Consent, Then Charges Late Fees

Is Chase enrolling customers in paperless billing without their consent and then charging them late fees when they fail to pay? That’s what seems to have happened to Jack, who writes:

Don’t know if it’s only me, or if this is a nefarious scheme, but in the past month I have been stuck with late fees on two credit cards for apparently (allegedly) missing payments. Both of the accounts have been paperless bills, paperless billing for which I have not enrolled.

Upon paying the entire balance (for both cards); one waived the late fee and put me back on paper bills and one refused to waive the late fee, but offered to put me back on paper bills. I canceled the card and have refused to pay the late fee.

Again, I don’t know if this is a trend or some kind of scheme, but perhaps other folks have (are having) this problem.

I pay all but one of my credit card bills in full every month (only one not paid in full has a 0% rate).

One is amazon.com card through Chase. The other is another Chase card. Hmmmm, a coincidence?

Any other readers experience getting mysteriously changed over to paperless billing and then charged late fees, either with Chase or another bank? It seems to have happened to at least one other person, also with Chase.

The other question is whether it’s due to malice, or mere incompetence. The behavior of JP Morgan Chase’s subsidiary, SST Card Services, makes one wonder how far the poison apple falls from the tree. — BEN POPKEN

(Photo: David Nemesis)

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  1. aparsons says:

    Time Warner Cable did this to me. I paid by credit card one time, they automatically switched me to paperless billing (I never received the email for my next billing cycle) and they charged me a late fee when I called to ask why I didn’t receive a paper bill in the mail. I’m willing to bet this happens a lot.

  2. DeeJayQueue says:

    why do we keep seeing people complain about getting dinged for late fees for credit cards? The due date on the bill hasn’t changed, pay it whether you have a bill or not, you know you keep a balance on there, and you should know what that balance is.

    If you borrowed money from your mom and one month she forgot to ask for it, you’d still send her the money, because you know you owe it to her. Same with credit card companies, except your mom can’t affect your credit rating.

    Just pay the bills, whether you have them or not.

  3. Tallanvor says:

    @DeeJayQueue: Some people don’t use a credit card every month and they pay off the entire bill when they do. For those people, getting the paper statement can be a lot easier than having to remember if they used the card or going and checking online to see if they owe anything.

    Jack shouldn’t have been enrolled in paperless billing unless he specifically requested it, or was given clear notice that he would be enrolled beginning on a specific date (credit card companies giving you clear notice of anything? That’ll be the day!)

  4. ncboxer says:

    Why do people who pay off their credit card bill every month pay manually by sending in payment or making an Internet payment? I dropped all my cards that didn’t offer automatic bank draft and searched and found one that did. I still get the paper bill every month and review it for unauthorized charges, but their is no need to worry about remembering to pay the bill every month. In fact almost all of my bills are setup to pay by automatic bank draft or by credit card.

    But if I was paying manually like the complaint, I wouldn’t remember to pay my bill if they didn’t send me a statement. There should be no question about dropping the late fee.

  5. matt1978 says:

    While it may be shady, DJQ is right. The 15th doesn’t change whether or not you got a letter in the mail. Anywho, if you’re only buying one or two items every month (maybe less), how hard is it to keep up with it?

  6. mattmill says:

    I had this happen to me with DirecTV last winter.

    I guess when loging into my account on the website I unknowingly gave my consent to change my account to paperless. I mailed the payment with a printout and they dinged me with a late fee since they use a different address for customers on paperless billing. I spoke with them and they switched me back to paper but would not remove the late fee. I now have the account set to NEVER go paperless without written authorization.

  7. B says:

    I have an Amazon credit card, and I pay my bill off in full every month, but without a bill, I won’t know how much to pay them.

  8. yellojkt says:

    @DeeJayQueue: I have all my bills set to pay the maximum minimum balance (2% of the credit line) every month so that this never happens to me. The credit card company moved my due date up a month and the only way to notice was to read the due date on the bill. Since I have had the same due date for years, this struck me as a deceptive practice.

  9. alohanico says:

    This happened to me with my wireless provider (Fido Solutions/Microcell). I signed up for direct debit in lieu of my pre-authorized credit card payment about a year ago and I got paper bills for the first few billing cycles and all of a sudden the paper bills stopped coming.

    I’ve called them at least a half dozen times to get them to re-instate my paper bills but to no avail. I wouldn’t even mind if I got email notification of new bills being posted but this has stopped too.

    I’m such a visual person that I just don’t think about my online bills unless I check my balances online obsessively (ie. my credit/debit accounts) and I’m never home so when I do pick up a paper bill I pay it immediately just to get things out of the way.

    I can’t count the number of times I’ve been dinged by late fees just because I have no clue when my new billing cycle begins because it always seems to change.

    The funny thing is, every time I call to request a paper bill the customer service rep implies that tit’s probably just because they don’t have my address on file properly but I know that’s not the case because I still get promotional mailings and the like from them…

  10. TaxChick says:

    Chase does have automatic bill pay. I use it successfully.

    What may have happened is an inadvertant switch to paperless. They had this screen that you would get whenever you logged into the online account access. It was pretty easy to inadvertantly hit, their whole hope. Could this have happened?

  11. FLConsumer says:

    @DeeJayQueue: Actually, some banks (MBNA/BoA now) DO change the due date each month.

    @matt1978: Who only buys 1-2 things a month?

  12. FLConsumer says:

    @yellojkt: That trick might work fine if you carry a balance over from month to month, but for those who pay off bills in full each month, we need to know how much is owed so that we can send a proper payment.

  13. mac-phisto says:

    sometimes the online agreement requires you to enroll in paperless billing just to access your account, others require it when you make an online payment. directv made me enroll to view my bills online.

    by law, you must have e-signed or paper signed to enroll in paperless billing & they also must give you a way to opt-out.

    unfortunately, the e-sign act (which governs digital signatures) makes it virtually impossible to prove/disprove that a service was signed up for, so really the only recourse for the consumer is to opt-out.

    IANAL, but if this particular person never logged onto online banking, then they could probably prove that there is no digital signature, which could give him some legal recourse.

    @ncboxer: i NEVER set up auto payments b/c of a bad experience w/ cingular where they incorrectly auto-debited about $500 more than i owed them. imagine my surprise when my credit union called me to tell me i was overdrawn (‘WTF!! i have a few hundred dollars in there!’ ‘uh, not since your cell bill came out’). just try getting the money back from them once they have it (‘we can offer you a service credit’ ‘no, you can auto-credit it back to my acct, thank you very much’ – i got a check 2 wks later).

  14. poulw says:

    Looks like Orchard Bank is following the same path. I just checked online and I’ve got a payment due two days from now but no paper bill.
    I don’t habitually remember due dates for all my bills and have grown to rely on the paper bill arriving in my mailbox as a reminder.
    I see I need to adjust my habit.
    Orchard Bank appears to be a type of second chance credit issuer and the interest rate on a defaulted account jumps to %29.9. Luckily my balance is only $200.
    On the positive side I pay my cards through the web anyway and can say that of the three cards I hold Washington Mutual has the best web portal and service offerings.

  15. hrmann_2000 says:

    We had the EXACT SAME THING HAPPEN WITH CHASE. We had one of their promotional 0% interest deals on balance transfers, and put $18,000 on the card. A few months later we were hit with late fees and they pulled the 0% rate because of missing payments. After several calls, they claimed that we had changed our account to paperless. Neither I, nor my spouse did this, nor did we receive emailed statements. They refunded most of the late fees, and returned our interest rate to 0%. We have since closed the account.

  16. FLConsumer says:

    @mac-phisto: I’d NEVER let a company “pull” money from my account. I’m only willing to push money from my account to them through my bank / credit union’s account via BillPay or transfer(ING Direct).

  17. Nytmare says:

    I see two huge security risks with electronic bill paying: blank-check quantities of money being withdrawn automatically from your personal savings stash, and having your personal account access information stored at third party locations. But apparently I’m stupid for not signing up because people find it so convenient. I don’t get it.

  18. Buran says:

    @ncboxer: Because what if they screw up and debit twice? Or take more than is allowed? Or otherwise help themselves to my money?

    They are not getting auto debit access to my accounts. It’s that simple.

  19. ncboxer says:

    I’ve done auto draft for years and never had a problem. True, that doesn’t guarantee some company won’t try to screw me, but it gives me piece of mind knowing I won’t miss a bill. Before I had bills due all the time and had to worry when a certain bill was due, how long I thought it would take to get there, if they received it or not, etc. It was driving me crazy.

    Now there are some bills I auto pay on my credit card so that if I have I can dispute it with them easier or just cancel the card- companies like my cell provider, my ISP, and several others. Things like my mortgage, my car loan, etc are the same every month and there is zero risk (at least in my mind) having it bank drafted.

    Another reason I bank draft is because I am lazy- I keep at least 8k in checking and balance my checkbook every couple of months. I do look at all my statements for inconsistencies, but I don’t like having to worry about money so much.

  20. Buran says:

    @nytmare: It’s simple: your opinion doesn’t matter because they think they’re above everyone else.

    Now, who’s stupid, those who just don’t agree or those who think they’re above the plebes?

    (FYI, I agree with you, see my comment above)

  21. LAGirl says:

    i had the same problem with The Gas Co, Bloomingdales and Macys. i was told that if you make a few consecutive payments online, the system will automatically stop sending you a paper statement. i had CS go into my account and change it back to paper statements. but, the next time the system sees that i’ve made more than one monthly payment online, it will stop sending me paper statements again!

  22. Buran says:

    @ncboxer: What about using manually-paid e-bills? I do this, and all I have to do is check my account once a week or more. Then you can make sure it gets there on time by setting the due date on or before the due date on the e-bill, and since it’s all electronic it won’t be lost in the mail, and if you do ever not get credited the bank will investigate why.

    The funniest reason for why a payment was “lost” was the time I sent one to a friend (in which case the bank does cut a check and mail it, but for all my “real” accounts it is all electronically transferred) and the envelope looked like my friend’s mom’s alimony check. So she deposited it — even though her signature didn’t match the name on the check! The bank faxed a copy of the cancelled check to my friend and that immediately solved the “where’d it go?” mystery … and we STILL laugh about it to this day. (To make up for the mistake, she paid for an airline ticket for him that cost about the same amount as was on the check).

  23. ncboxer says:

    @Buran: I don’t do manual e-bill because (1) I am very forgetful- I have had to pay late fees and finance charges because I have missed something, (2) I still would have to worry about all these due dates, (3) I find it to be the same as bank draft or auto credit card, except I have to do it manually. For everything except a credit card (even though I do with a credit card as well), I need to pay off the entire amount each month. Things like mortgage, utilities, cell phone, loans, etc. If there is a dispute with a bill, I call up and get it resolved. If something big happened like my the cell company charging me $500 and not taking it off, I could always block the auto pay (at least I think I could- never investigated it before). I guess I have never been burned with auto pay so that is why I continue. I know too many people that forget to mail in payments and get hit with late fees and a bad credit rating. My way fits me, it doesn’t fir everyone…

  24. SadSam says:

    I agree, its bad practice to give credit card companies or other folks access and permission to pull money from your account. Just try getting that money back! Set up your on-line bank account to pay bills but don’t agree to let companies pull money. As a result, one needs to receive the bill in order to set up payment.

    @FLConsumer:

  25. raindog says:

    Once bitten, twice shy. I set myself up for direct debit on a car loan 6 or 7 years ago, to save a quarter of a percent. One month, they took the payment twice. I called them on it, but they wouldn’t give me a refund or even let me skip the next month, just applied the extra payment as a principal payment.

    After that, I opened another checking account elsewhere, never kept more than the amount of a single payment in my original account, even after paying the car loan off, and I’ve never done direct debit with anyone else except my money manager. Sure, most people have no problem, but if you ever do have a problem, you’re screwed.

    At least if you give them a credit card number you can dispute unauthorized charges, though judging from the Xbox Live story, that’s not always safe either.

  26. r00tdenied says:

    I would avoid Chase like the plague for credit cards. I have one of those United Mileage Plus Visa cards. When I originally had the account it was with First USA. Subsequently Chase bought out First USA. However with out any warning what so ever, or any delinquencies (I’ve never ever been late on any payments), they decided to change my interest rate to the default rate when I had a hefty balance remaining on the account. This has pretty much pissed me off. I have called and complained up and down till I was oxygen starved and they refuse to do anything about it.

    So Chase customers beware, they will change your interest rate without warning for their profit, despite the fact that you may have a long well established credit history with no negative marks.

  27. penner42 says:

    I had something somewhat similar happen with Chase, but not quite exactly the same. I had a BankOne Amazon card, that I only use for Amazon purchases. I don’t have paperless billing, but I rarely open the bills because I also have eBilling. When Chase aquired BankOne, I continued to not open the paper bills, but didn’t notice that the eBills stopped coming until I re-registered for them with Bank of America. It was several months before I realized it, and paid the whole thing off. I called them up, and they waived all fees and interest for me.

  28. Junkman says:

    If you read the complete agreement when you sign up for online access with Chase, it says way down in the text that you agree to go paperless. I was pretty peeved when I saw that, but agreed anyway so I could have online access.

    They didn’t switch me to paperless, but they do vary the due date in a range of about three days.

    Also, their system doesn’t always make scheduled payments and their phone based customer service doesn’t always follow through. I’ve never had a problem with the online customer service though.

  29. rikkus256 says:

    This is exactly what happened to my girlfriend’s American Express card two months ago. She was hit with late fee and $338 finance charges for “missing payment”. When she called stating she never received her statement, the CSR told her she has enrolled in paperless billing (in fact she never did!). The phone CSR refused to refund the fees. We’ve wrote to AMEX customer relation department and are currently waiting for response.

  30. TechnoDestructo says:

    @DeeJayQueue:

    I got dinged for late fees 2 months in a row because Chase changed my due date…2 months in a row.

    You are wrong, especially with regard to Chase.

  31. Kat says:

    I have the Chase Amazon Visa and no problems. I suspect if you pay online there may be a checkbox that says “change me to paperless billing” that is auto-checked… if you don’t see it and uncheck… there you go.

    I have paperless billing by choice, and Chase sends me an e-mail each month about 10 days before the bill is due. Even though I have that, I still have a monthly reminder set in my calendar.

  32. TechnoDestructo says:

    @r00tdenied:

    “So Chase customers beware, they will change your interest rate without warning for their profit, despite the fact that you may have a long well established credit history with no negative marks.”

    True. They did this to me. (Fortunately I wasn’t carrying balances…until they started changing the length of my billing cycle.)

  33. Osomatic says:

    I’ve had a Chase Visa card for nearly 20 years now (and I’m only 35). I’m not crazy about them – they keep offering me new low rates and then jacking the APR to over 20% – but all of that said, they surely did not just change my account to paperless. They offered it, and I made the decision myself.

    Why I remain with them? Because a nearly 20-year relationship with one lender looks pretty awesome on Ye Olde Fico Score. I know, I know, I’m pandering to The Man. Also, though, I only charge one or two things on it every now and then.

  34. transpire says:

    Guys this may have been what happened to me. I don’t remember getting a paper bill, nor signing up for paperless billing for this certain card. I’ve alread sent this info to Consumerist and hopefully something can happen because of our issues.

    My bills have always been due around the middle of the month. They go like this for example 3/25/07-4/24/07, add 20 days and I got my (roughly) due date of around the middle of the month. This is how it always was with my three Chase cards.

    However on the account I have a 0% interest offer on, they changed my due date to the first of May, when it should have been around the middle of the month. What’s even more strange is I’ve never had a credit card not have a 30 day cycle. On my last statement from viewing it online, it looks like this:

    Opening/Closing Date: 03/26/07 – 04/11/07
    Payment Due Date: 05/01/07

    Why would that cycle only have around 16 days in it? Did they enroll me in paperless billing (like I said I don’t remember a bill in the mail, and I don’t remember signing up for paperless for this account, I am on another though) without my knowledge and that had to cause a change in due dates??

    I havent called them yet, but I’ve emailed them every day explaining to them how this is wrong, how they should waive the late fee and give me back my 0% interest until October, and while they “value my opinions” and “value me as a loyoal customer” they still wont do anything. Everytime I ask them why that billing cycle only had 16 days in it, they dance around the issue and never answer it.

    If this is happening to others, please post so we can garner more attentiong for this!

  35. skeleem_skalarm says:

    Those sonsofbitches! I thought I had received my bill and misplaced it or just not received it due to an error on Chase’s part. Fortunately, I check my account on line frequently, and I know when it’s due (usually) so I got it paid in time. The thing that really gets me is that they put my due date six days earlier than it had been. Those bastards. They’re not the only company doing this. The company that financed my new home tried to pull this on me, and when I questioned them about it, they responded that since I’d paid my mortgage on line three times, they automatically went to online billing only. They did, however, start the paper bills when I requested them.

  36. skeleem_skalarm says:

    I’ve contacted Chase, pointing them to this site, letting them know of my outrage over such sleazy tactics. I’ve also requested that they continue sending me paper statements. Terms of use aside, it’s despicable to up the due date while at the same time, without warning, not sending a paper statement. I’m very careful when I pay any bills, on line or on paper, not to let checked boxes go unnoticed, so I know one didn’t get past me requesting paperless billing. What a scam!

  37. Androminos says:

    BEWARE THE DUE DATE SHUFFLE!!!

    I haven’t been switched to paperless by Chase, but they’ve got other tricks up their sleeve.

    I like having one due date for all my bills so I took advantage of Chase’s willingness to “set” the due date to whatever one likes. But BEWARE!! Some companies (Chase as an example) will set a due date and then change it without any warning other than the indicated due date on a statement. So if you are like me and like everything to be automated, you can get scr*wed if you rely on the companies to keep their promises regarding due dates.

    When I took out a very large credit line on a promotional rate, Chase asked me what due date I would like and set it for me. I set my automated banking to pay my bill on the same day each month based on the date agreed upon (with about 5 days to spare–just in case). For several months there was no problem. After about 5 months I happened to check my statement and noticed a late fee on the account. It turns out that 2 months prior, Chase had changed the due date by about 10 days (earlier, of course) causing 2 of my payments to be late, fees to be assigned, and my rate to skyrocket. Oh yeah…the rationale for the due date change? “Your grace period changed from 25 days to 20 days, so your due date changed”. Huh?!?! How the heck does a “grace period” change necessitate the changing of a due date by 10 days after making an agreement with the customer for a specific date? That’s a crock.

    When I called to resolve the matter, Chase graciously offered to return one of the fees but took no responsibility for the misrepretentations of the original salesperson regarding the fact that the due date would not change (which I had specifically asked about). They pulled out the old “well Sir, your contract says….”. Contract schmontract. I asked about returning the rate to what it was previously and they said I’d need to contact them next month after I receive my statement, at which time they would “see what promotional rates are available at that time”. Let me guess, my original rate of 3.99% on my $16,000 line will be no longer available (Oo…what a surprise) but they’ll be happy to offer me the low, low promotional rate of 8.99%. That’s terrible, decietful customer service. Thanks for nothing, Chase.

    I heard a report on NPR in which they discussed the fact that this is actually a strategy used by credit card companies to create this exact situation and extract more money from the customer. For shame.

  38. skeleem_skalarm says:

    I received a reply to my email to Chase in which they told me they *did* send me a bill (bullshit), and they would refund any late fees that were charged as a result of my not receiving the bill. I think they probably got so many complaints, they decided denial and refund were the way to go. I just hope they don’t try it again.

  39. lundo says:

    My wife and I have had a similar problem with a Chase Amazon.com card. We always pay in full every month and on time. But, when the due date fell near the Memorial Day holiday, the time to mail a check and process it extended beyond the due date, resulting in a late fee. A call to Chase to rectify the matter and point out our spotless payment record was met with a ‘we don’t do courtesy adjustments’. After pointing out the large volume of transactions we made on the card, my wife promptly canceled the account.

  40. a_m_m_b says:

    FTLOGP – read the terms & conditions! quit clicking thru them or otherwise ignoring them & blaming the bank for your own willful ignorance. also, non-receipt of your statement does not absolve you of your obligation to pay on time for charges you chose to rack up on your card. failure to be an intelligent consumer is not the issuer’s fault or problem.

    providian does the due date shuffle all the time. best ways to deal with it – close it, keep it paid at least 1 mo ahead or pay it off right after you make the purchase.

  41. debmahtab says:

    If I had a dollar for everytime I have gone ballistic or cried over this crappy company. My card was sold to them, they increased to 30%, no paper statements, etc, etc, etc. I am so desperate to pay them off I am going to get a part-time job. What a scam and I don’t understand why the government has not shut them down. Today I am trying to access my account and the website is “DOWN”. Happens all the time…………..