Credit Union Excessive Overdraft Fees Legal News Articles & Interviews

Camden, NJ  Laronda Hickmond filed a bank overdraft fees lawsuit against Credit Union of New Jersey in New Jersey District Court on March 17. Hickmond v. Credit Union of New Jersey alleges that the credit union repeatedly charged Ms. Hickmond $30 overdraft fees even though, according to the monthly account statements prepared by the credit union, her account balance never dropped into the negative. She seeks class action status for the lawsuit on behalf of herself and all similarly situated accountholders.

Albany, NY Excessive bank fees that are based on insufficient funds (NSF) charges may pose a greater threat to checking accountholders than overdraft fees. Recent lawsuits recognize that, without protections based largely in state contract law, consumers have little protection from NSF fees that result when checks or electronic payments that are presented and re-presented multiple times without the accountholder’s permission.

Houston, TX  On March 1, the State of Texas filed a lawsuit in Texas state court, alleging that Griddy Energy LLC misled energy consumers in violation of the Texas Deceptive Trade Practices—Consumer Protection Act  (DTPA). In the aftermath of the massive February winter storm, Griddy customers found themselves with the astronomical electrical bills. One Houston resident complained that Griddy debited her credit card $4,677 in one week for electricity in her 800 square foot, one-bedroom apartment: “I do not have the money to pay this bill. We need help.” Griddy also auto-debited hundreds, sometimes thousands, of dollars from consumers’ checking accounts in a period of days. These massive daily withdrawals triggered cascading bank overdraft fees.

Los Angeles, CA On February 19, the Ninth Circuit held that a borrower, who found herself in what she described as a “high-tech debt trap,” must arbitrate her claims against the lender, having waived her right to sue. Marggieh DeCarlo was trying to build credit but instead found herself entangled instead in a ruinous web of loan charges, membership fees and bank overdraft fees.

Atlanta, GA On December 17, the U.S. Court of Appeals for the Eleventh Circuit heard oral arguments in Garcia v. Wachovia Bank, one of the bank overdraft fees lawsuits, consolidated in In Re: Checking Account Overdraft Litigation. The checking accountholders are appealing a September 2019 District Court decision that denied them the chance to proceed through a class action lawsuit, forcing them to arbitrate their claims individually. That would effectively end their chance to dispute excessive overdraft fees that resulted from Wells Fargo’s and Wachovia Bank’s practice of reordering checks from high to low amounts in order to maximize profits.

Alexandria, VA  The Eastern District of Virginia appears poised to approve a proposed settlement in a class action bank overdraft fees lawsuit originally filed against Navy Federal Credit Union in 2019. Under the terms of the proposed settlement, checking account customers at Navy Federal who were overcharged will have a common fund of $16 million to divide among themselves. The settlement is notable because class members need not file claims to receive compensation. The settlement fund will be automatically allocated among them according to a distribution plan set out in the agreement.

Santa Clara, CA A proposed settlement by Earnin, an app-based pay advance service, would theoretically pay up to $12.5 million to consumers who claim they were misled by Earnin and were charged bank fees they weren’t aware of before signing on with the service.

San Diego, CA On August 10, the Southern District of California agreed to reconsider its own ruling in an overdraft fees lawsuit that forced the dispute into arbitration. On reconsideration, it reversed itself. This breathes new life into Reyna McGovern’s contention that U.S. Bank charged bank overdraft fees that were not permitted under the terms of the account agreement that she and many other customers signed. Now they get a chance to have their claims heard in court. The Order Granting the Motion for Reconsideration may have implications for other Californians who, perhaps unwittingly, signed arbitration agreements when they opened a checking account.

San Diego, CA For months, the law firms that represent banks and other big businesses have worried that the Ninth Circuit’s 2019 decision in Blair v. Rent-A-Center shows plaintiffs how to side-step mandatory arbitration provisions that include class action waivers. Defense counsel’s worst fear is realized in the motion for reconsideration filed in McGovern v. U.S. Bank, a California bank overdraft fees lawsuit. 

Camden, NJ  On June 24, Judith Jimenez filed a class action bank overdraft fees lawsuit claiming that TD Bank, NA re-opened her checking account, which the bank had previously closed, for the express purpose of charging her an overdraft fee. Mission accomplished, the bank then closed her account again – all without her authorization. The lawsuit further claims that TD Bank had a routine practice of opening accounts in the names of consumers without lawful authority. If this sounds familiar, it should.