The California Attorney General's office has filed suit against JPMorgan Chase for their use of robo-signing affidavits to support debt collection lawsuits.
What's robo-signing? It's a practice of signing legal documents where the signer has no real knowledge of the information they're stating is true with their signature. In credit card lawsuits, this is often done by signing affidavits claiming that the offered credit card statements are true and accurate records of the account. The reason it's called robo-signing is that the signer doesn't actually have any personal knowledge that the information is true. They are given a stack of affidavits at a time and, at best, confirm the information in the affidavit matches the information on their computer screen. Effectively, the affiant (the person who signs the affidavit) is just a robot.
The problem with robo-signing is that these affidavits are used in court to prove the debt is valid and the amount claimed is accurate. Courts rely on these affidavits the same as if the affiant actually testified. But if the affiant doesn't actually know if the information is true, then their testimony is inherently unreliable, but there's no way for a judge to know this just by reading the papers. It is the creditor's job to prove to the court the debt is valid, but instead of providing real proof, they sloppily produce these affidavits. These unreliable affidavits result in thousands of unlawful judgments against consumers. And judgments can give a creditor the right to attach wages and place liens on property.
I'm glad to hear that state agencies are taking notice of the egregious credit card debt collection practices. Hopefully, the trend continues and other states join the fray. Thanks to the LA Times for the coverage.