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Union Bank Excessive Overdraft Fees
Santa Clara, CA: Union Bank settled an excessive overdraft fees class action in 2011, for $35 million. The bank was one of 30 banks facing allegations of manipulating the order of debit card transactions so they could deplete customers’ checking accounts and trigger overdraft fees.
Further, the lawsuit alleged that Union Bank re-sequenced checks in such a way as to intentionally cause its account holders to go into overdraft. This involved clearing checks for higher amounts first, causing checks for smaller amounts presented on the same day to bounce, triggering overdraft fees.
Today, Union Bank is still receiving complaints of excessive overdraft fees. Overdraft fees are charged when customers attempt to conduct a transaction from their bank account that they do not have the financial means to cover.
Bank accounts go into overdraft when more money has been taken out of the account than was actually in it. It can happen quite easily: a bank account has $100 in it, but the customer makes a debit card purchase for $110, pushing the account $10 into overdraft.
In 2013, the Consumer Financial Protection Bureau reported that overdraft and insufficient fund fees accounted for 61 percent of bank profits from consumers.
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Published on Jun-20-17
UNION BANK EXCESSIVE OVERDRAFT FEES LEGAL ARTICLES AND INTERVIEWS
Banks Fight Excessive Overdraft Suits with Bid for Arbitration
September 8, 2017Atlanta, GA: Only a nut would sue for $35. Banks count on that when they boost overdraft fees through a technique known as “debit resequencing.” The 2010 changes in banking law that were part of Dodd-Frank have failed to kill the practice. It persists even after a $35 million class-action settlement over Union bank excessive overdraft fees in 2011. One of the banks’ newer schemes to keep this revenue source producing has been to force consumers out of class-action lawsuits and into costly individual arbitration. Only a nut would arbitrate over $35 [READ MORE]
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