Request Legal Help Now - Free
LAWSUITS NEWS & LEGAL INFORMATION
Home Page >> News Articles >> Judge in Bank Overdraft Fees Case Rules ..

Judge in Bank Overdraft Fees Case Rules in Favor of Plaintiffs

. By
Denver, COBanks across the United States are feeling the wrath of unhappy customers as lawsuits alleging excessive bank overdraft fees pile up. Customers allege they are not only charged outrageous bank overdraft fees but are also subjected to reordering of transactions, which pushes their accounts into overdraft quickly, increasing the amount they pay in banking overdraft fees.

A judge in a lawsuit against SunTrust Banks Inc., M&T Bank Corp., and two other banks ruled customers can file lawsuits against the banks rather than having to file an arbitration. The judge ruled that a Supreme Court decision on arbitration agreements involving AT&T—in which the Supreme Court ruled companies can force arbitration agreements on customers—must be applied individually to each case, meaning that customers of the banks involved in the fee lawsuit are not forced to file an arbitration.

In making his decision, the judge found that arbitration agreements for the banks involved in the lawsuit are "unconscionable" and unenforceable. According to Bloomberg News (09/07/11), lawsuits filed against the banks alleged the financial firms reordered debit card transactions to increase profits made off overdraft fees. More than 30 banks face lawsuits alleging they have unethical overdraft fees policies.

Although banking regulations have changed, including Congress taking action on overdraft fees, consumer groups argue that overdraft fees are still too high. According to the SunSentinel (09/02/11), the average overdraft fee at the largest banks in the US is still $34, the same as it was last year. Consumer advocates say the banks will make approximately $38 million in overdraft fees this year, $3 million more than last year, despite Congress taking action on the fees.

The new regulations from Congress, enacted in 2010, did not set a cap on overdraft fees. This means that customers who go as little as $1 into overdraft could still trigger a $34 overdraft charge. Banking regulations passed last year forced banks to ask customers to opt-in for overdraft protection, rather than automatically allowing it. But they did not address reordering of transactions. Some banks, facing lawsuits about the practice, have voluntarily agreed to stop reordering transactions.

Earlier this year, Bank of America agreed to pay $410 million to settle its part of a class-action lawsuit alleging banks reordered debit transaction to increase profits.

READ ABOUT BANK OVERDRAFT FEE LAWSUITS

Bank Overdraft Fee Legal Help

If you or a loved one have suffered losses in this case, please click the link below and your complaint will be sent to a financial lawyer who may evaluate your Bank Overdraft Fee claim at no cost or obligation.

READER COMMENTS

Posted by

on
My bank has been charging excessive fees and I'm quite confident they have set up a system that encourages bank fees by timed automation that noone can predict or overcome. I am now being charged fees for transfering funds from one account to another due to insufficient funds even though the account shows funds available. They have the ability to show what checks or transaction are coming though but choose not to show those as to encourage these fees to occur...this has to be illegal. My business has been charged in excess of $3,000 in the last 6 months. There has to be at least a cap to how much these crooks can charge annually!!

ADD YOUR COMMENT ON THIS STORY

Fields marked * are mandatory. Please read our comment guidelines before posting.

*Name:

Note: Your name will be published with your comment.

*Email Address:

Your email will only be used if a response is needed.
*Your Comment:

Are you the defendant or a subject matter expert on this topic with an opposing viewpoint? We'd love to hear your comments here as well, or if you'd like to contact us for an interview please submit your details here.


Click to learn more about LawyersandSettlements.com
Request Legal Help Now! - Free