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B of A Reaches Overdraft Fee Class Action Settlement 
By Mike Holter
 

Bank of AmericaBank of America has agreed to pay $410 million to settle a collective class action lawsuit accusing the bank giant of charging customers with excessive overdraft fees.

 

Bank of America is just one of more than two dozen U.S., Canadian and European lenders named as defendants in the overdraft fee class action lawsuit, which was consolidated in 2009 from multiple lawsuits across the country. JPMorgan Chase & Co., Citigroup, Inc. and Wells Fargo & Co. are among the other defendants named in the case.

 

Bank of America customers sued the company in 2009 for routinely processing debit transactions from largest to smallest rather than in chronological order, which dropped account balances faster and allowed the bank to boost the potential for overdraft fees, the lawsuit said.

 

The complaint further charged Bank of America with not clearly telling customers they could decline overdraft protection, and with automatically charging the fees to debit card users rather than declining the transactions. Because of this practice, the lawsuit said, Bank of America customers often racked up hundreds of dollars in overdraft fees, even when their accounts may have only been overdrawn by a few dollars.

 

Bank of America isn’t the only bank accused of placing card transactions and/or ATM withdrawals in non-chronological order in order to maximize overdraft fees. Wells Fargo and Fifth Third Bank recently reached class action lawsuit settlements over this practice, and a class action lawsuit against FirstMerit Bank is currently pending.

 

Overdraft fees industry wide totaled nearly $23.7 billion in 2008, nearly double what they were in 2004, according to the Center for Responsible Lending. If the spike in overdraft fees is truly a conspiracy like these multiple class action lawsuits seem to think, then these banks seem to be getting their just desserts. 

 

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Updated February 10th, 2010

 

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18 thoughts onBofA Reaches Overdraft Fee Class Action Settlement

  1. Anonymous says:

    I received a letter saying I didn’t have to do anything and would receive my compensation but have not received any money for the overdrafts that occurred on my account. How do I get my money?

  2. Anonymous says:

    For this class action, you’ll get a notice in the mail if you’re a class member; which is anyone who had a Bank of America debit card between Jan 2001 and May 24, 2011, and you’ll automatically get a payment or credit when funds are released.

    On November 7, 2011, the Court granted final approval to the Settlement with B of A, approved awards to the Plaintiffs. On November 22, 2011, the Court entered a corresponding order and judgment that formalized the Court’s final Settlement approval and the fee award.
    Under the terms, distributions will not be made, until after the Effective Date of the Settlement. The Date, as provided in the Agreement, will not occur until after any and all appeals are finally resolved which – could take approximately one to two years.

    Read all about this at:
    http://www.bofaoverdraftsettlement.com.

  3. Anonymous says:

    Show me the Money!!!!

  4. Anonymous says:

    Is it too late to file on the Bank of America overdraft lawsuit?

  5. Anonymous says:

    Is it too late to file on the Bank of America lawsuit for overdraft fees?

  6. Anonymous says:

    I can’t find where to file against Bank of America

  7. Anonymous says:

    I had both Small Business and Personal Accounts for years up until about 2008 and they were a nightmare. I can’t say how much money was removed and how many games were played. I eventually closed my accounts due to the practice of holding funds for deposit longer than expected and taking payments out earlier than expected and basically stealing money almost every day (many days cleared and the next day they had gone back in and rearranged transactions to clip monies). When will the payees of this lawsuit be contacted and paid?

  8. Anonymous says:

    well thats all fine and dandy….. look,, how many people are expected to receive money anyways? i have looked all over on the internet and can’t find an answer. How much will i receive? does anyone know an answer for any of my questions?

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