TD Bank Class Action Lawsuit: Accounts Reopened for ‘Pure Profit’

A Florida consumer is claiming TD Bank violated its customer agreement by reopening an account in her name to reap extra profits.

Judith J. Jimenez says she had a checking account with TD Bank since 2005. Under its account agreement, TD Bank has the right to terminate or close any account at any time for any reason, without advance notice. However, Jimenez argues in the TD Bank class action, that agreement does not include authorization to open or reopen any account on behalf of a customer.

And yet, she claims, TD Bank “has a routine practice of opening accounts in order to generate fee-based income to which it is not lawfully entitled.”

On April 15, according to her complaint, TD Bank closed Jimenez’s checking account and mailed her a check for the account balance of $342.65. The check indicated it was for the “Closed Account Ending 9188.” She later received her bank statement, which noted the withdrawal made April 15.

Prior to this action, Jimenez’s account had been in good standing for 15 years. She reportedly had a running balance in the $300 to $500 range, and had incurred just one overdraft charge in the previous several months. TD Bank provided no explanation or documentation; still, under the account agreement, the bank was within its rights to close the account.

However, on April 17, the bank reopened the account in Jimenez’s name without her knowledge or permission — with a zero balance, because a check for her previous account balance had been mailed to her.

The TD Bank class action claims four motives were behind this action: “(1) to reverse a provisional credit of $12.31 that TD had previously issued to Ms. Jimenez; (2) to process a $35 check that Ms. Jimenez had written prior to TD Bank closing the account; (3) to assess Ms. Jimenez a monthly maintenance fee of $4.99 for her account; and (4) to assess bogus fees that amounted to nearly 100% profit for TD.”

Subsequently, on April 20, TD Bank refused to pay Jimenez’s $35 check and assessed her an overdraft fee of $35. The bank also reportedly charged another $35 overdraft fee for the provisional credit reversal.

On April 22, Jimenez’s income tax refund was deposited directly into her account. TD Bank immediately withdrew $87.30 of those funds “to replenish her purportedly negative balance” — $70 in overdraft fees plus the $12.31 credit reversal plus the $4.99 monthly maintenance fee. This was all “pure profit,” according to the TD Bank class action.

Later that day, Jimenez says she sent a letter to TD Bank asking for an explanation about her account being closed. She has not yet received a response.

On April 28, TD Bank once again closed Jimenez’s account and mailed her a letter with a check for the remaining balance of $84.88.

She also reportedly received a bank statement covering April 15 through 28 showing the closure.

The TD Bank class action lawsuit maintains that Jimenez’s experience is not unique.

The filing cites TD Bank’s response to a similar incident several years ago in the industry.

In 2016, investigators discovered Wells Fargo Bank had been fraudulently opening accounts without their customers’ consent.

In the end, Wells Fargo paid out $142 million to its customers — and a $3 billion settlement to the Justice Department and Securities and Exchange Commission.

“As the Wells Fargo scandal broke, several banks, including TD, conducted their own internal reviews to determine if similar issues existed. Following an internal audit in November 2016, a source familiar with the process indicated that the TD Bank did not find ‘anything systemic’ as was the case with Wells Fargo,” the lawsuit reports.

However, “based on Ms. Jimenez’s experience, and information gained from other TD customers, it is clear that TD Bank has a routine practice of opening and re-opening accounts in the names of consumers without lawful authority.”

Jimenez is asking the court to certify her lawsuit as a class action, with the plaintiffs defined as “all persons who, within the applicable statute of limitations period, had a checking or savings account opened in their name by TD Bank without authorization.”

The New Jersey-based bank serves 6.5 million East Coast customers from Maine to Florida.

On behalf of all putative Class Members, Jimenez is claiming breach of contract; breach of the covenant of good faith and fair dealing; unjust enrichment; and conversion.

She is seeking restitution of all fees at issue, plus damages and court costs. She also is requesting court orders compelling the defendant to halt its alleged wrongful conduct.

Has your bank opened an account in your name without your knowledge or consent? Let us know in the comments below.

Jimenez is represented by Richard M. Golomb and Kenneth J. Grunfeld of Golomb & Honik PC and E. Adam Webb, Matthew C. Klase and G. Franklin Lemond Jr. of Webb Klase & Lemond LLC.

The TD Bank Account Class Action is Judith J. Jimenez, et al. v. TD Bank NA, Case No. 1:20-cv-07699, in the U.S. District Court for the District of New Jersey.

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