Banks Accused of Charging More Than One Returned Item Fee Per Transaction

Some financial institutions are under investigation for charging more than one returned item fee for a single transaction.

Consumers allege banks are attempting to process transactions multiple times and charging a fee every time the transaction fails to go through. Many instances of a returned item fee can add up.

If you have had an electronic payment for a gym membership, video streaming service, insurance or an electronic transfer of funds through PayPal rejected by your bank more than once and been assessed a return item fee per rejection, you could qualify to participate in this lawsuit investigation.

When a bank account contains inadequate money to pay a transaction or check, the bank can reject the charge. A returned item fee is also known as a non-sufficient funds (NSF) fee. These fees are different from overdraft fees in that the bank declines to pay the transaction when it’s presented. Most banks charge around $30 for each returned item.

After a payment is rejected, the bank may try to process the payment again a day or two later. If insufficient funds still exist in the account, the bank may add another returned item fee. For every attempt to process the payment, the bank may assess another returned item fee. Before the customer knows it, multiple returned item fees have been assessed to the account and could reach charges of $100 or more.

Returned Item Fee Allegations

Banks make billions of dollars each year by charging returned item fees and NSF fees to consumers’ accounts. While it is not illegal for banks to charge such fees, consumers take issue with banks that abuse the practice by repeatedly adding charges to the bank account for the same transaction, over and over.

In one lawsuit filed against Bank of America, a customer says she was charged two NSF fees of $35 each before the transaction was covered. She was charged an additional $35 overdraft fee. She also claims she was charged $115 in NSF fees when she attempted a $20 payment on her credit card bill. Even though she knows the bank had the right to charge her one returned item fee per payment, she found it unjustified and deceptive of the bank to charge her multiple returned item fees for one transaction.

According to the customer’s lawsuit, the bank allegedly breaches its own contract when it charges both a $35 return item fee and a $35 overdraft fee on the same transaction because Bank of America’s contract says it cannot charge both types of fees on the same transaction.

In addition, the lawsuit alleges the bank is not allowed to charge overdraft fees “on a loan from itself, to itself.”

Consumer watchdog groups allege banks and credit unions make the most money by charging NSF fees, overdraft fees, and returned item fees on the accounts of people who are least likely to afford such fees. Most customers understand they can incur a single returned item fee for a single transaction but often are stunned to discover they have been charged multiple fees for a single transaction.

Join a Free Returned Item Fee Class Action Lawsuit Investigation

If you were charged multiple returned item fees (also known as NSF fees or insufficient funds fees) on the same transaction by your bank, you may be entitled to compensation.

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