Overdraft fees lawsuits allege that banks and financial institutions charge excessive overdraft fees to consumers and further that the banks reorder credits and debits to push customers into their overdraft, increasing the fees they can charge.
In March 2014, Synovus Financial Corp. agreed to pay $24 million to settle lawsuits alleging the company charged excessive overdraft fees on debit card purchases or ATM cash withdrawals. Synovas did not admit liability in the settlement.
In January 2014, the court gave final approval to a settlement involving U.S. Bank. As part of the settlement, U.S. Bank agreed to pay $55 million to settle allegations that it reordered debit card transactions to draw down customer accounts and increase the fees it could charge. Approximately 2.7 million people were reportedly affected by the settlement.
Also in 2014, a lawsuit was filed against TD Bank NA, alleging the bank continues to reorder debit card transactions to increase overdraft fees. The lawsuit was filed less than a year after the bank paid $62 million to settle similar allegations.
In October 2013, a judge allowed a class-action lawsuit against Umpqua Bank, alleging the bank’s practice of reordering transactions to increase debt fees violated California’s Unfair Competition Law.
In 2013, Wells Fargo was ordered to pay $203 million to settle allegations that it misled customers regarding the posting of debit card purchases by telling customers the transactions would be posted chronologically when they were in fact posted from largest to smallest, increasing overdraft fees. At the time the federal court reinstated an earlier court’s award, Wells Fargo said it would appeal the decision.
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Following Suit: Overdraft Fees Lawsuit Update
|. By Heidi Turner|
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