We are talking about the recent decision by JPMorgan Chase & Co. that surprised credit card industry insiders and consumer advocates alike. The bank stopped filing collection lawsuits against credit cardholders. While the bank has offered no explanation, some speculate that documentation and legal problems are behind it.

Those documentation issues include allegations of robo-signing, a term Georgia is familiar with. According to one consumer advocate, the robo-signing problem in the mortgage industry was dwarfed in comparison to the problems in the credit card industry.

Supporting the theory is the bank's involvement in a whistleblower suit last year. An employee alleged she was fired after questioning the documents supporting $200 million of legal judgments that Chase sold.

Chase did not dispute the claim, but said the buyer had purchased the judgments "as is," warts and all. Having disclosed the possibility that the judgments were flawed, Chase said, the bank had violated neither the law nor the sales agreement.

The parties ended up settling the suit. That same month, though, Chase pulled the plug on filing new suits against consumers in a number of states.

Industry insiders say the bank's move will likely mean significant losses. During the first quarter of 2011, Chase recouped $405 million; by third quarter, the total was down to $266 million.

Lenders, especially credit card issuers, have found the threat of litigation to be an effective collection tool. The bank would collect at least part of what they are owed if they took the debtors to court.

Chase customers will just have to watch and wait for the bank's next step.

Source: Collections & Credit Risk, "Chase Suspends Filings Suits Over Consumer Cards, Other Debts," Jeff Horwitz, Jan. 12, 2012