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JPMorgan Website Fails Again, Late Fees to Be Waived

Sept. 15 (Bloomberg) -- JPMorgan Chase & Co., whose website failed today for the second time this week, will refund late fees and help fix other problems for the 16.6 million online customers unable to access their accounts.

“We will work with customers to refund any fees that were incurred as a result of this problem,” said Joe Evangelisti, a spokesman for the New York-based bank. The site went down late Sept. 13 and service was restored around 1 a.m. New York time today. The system failed again several hours later and was back online with intermittent service this afternoon.

The bank’s primary regulator in Washington was on alert after the service initially failed.

“We monitored this situation very closely,” said Bob Garsson, a spokesman for the Office of the Comptroller of the Currency, declining to elaborate.

JPMorgan’s active online customers have increased by an average annual rate of 42 percent since 2006, according to a presentation to investors by Chief Executive Officer Jamie Dimon yesterday. More than 3.7 million households use JPMorgan’s website to pay their bills.

Visit a Branch

“A third-party database company’s software caused a corruption of systems information disabling our ability to process customer log-ins to Chase.com. This resulted in a long recovery process,” Evangelisti said, declining to identify the other company. “At no time was customer data at risk.”

Customers can call at 800-935-9935 or visit a branch to correct late fees. JPMorgan will also refund late fees charged by other institutions, said Christine Holevas, a company spokeswoman.

The length of the failure raises operational risk and internal control issues for the bank, which was the only major Wall Street firm to make it through the financial crisis without posting quarterly losses, said Christopher Whalen, a former analyst for the Federal Reserve Bank of New York and co-founder of Institutional Risk Analytics in Torrance, California.

“These systems are big and complex, but they should have redundancy to take the ‘A’ system offline if need be for hours at least,” Whalen said.

Dimon apologized for the inconvenience during his presentation at Barclays Capital yesterday, saying, “I know our system is down today. I apologize for that.”

To contact the reporter on this story: Dawn Kopecki in New York at dkopecki@bloomberg.net

To contact the editor responsible for this story: Alec McCabe at amccabe@bloomberg.net

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