Some credit union and bank customers are becoming aware that Commerce Bank overdraft fees and those of other financial institutions may charge deceptive or excessive overdraft fees.

Commerce Bank overdraft fees are being investigated for potential deceptive tactics.

The investigation will focus on financial institutions like Commerce Bank that may be charging excessive or unfair overdraft fees, or in some cases, automatically signing customers up for these services.

In some instances, customers may be signed up automatically for programs and may incur Commerce Bank overdraft fees in order to protect their account, but without voluntarily opting in to such a program.

Legally, financial institutions must allow customers to opt in to these overdraft programs before charging Commerce Bank overdraft fees.

What Are Overdraft Fees?

Overdraft fees are incurred when a customer overdraws the money in their bank account. With an overdraft protection program in place, a customer is allowed to take money they do not have out of the account.

By initiating overdraft protection in withdrawing money in excess of what is in the account, customers are charged overdraft fees for the transfer of money.

Overdraft fees are an accepted component of any overdraft protection system, but according to some dissatisfied customers, certain financial institutions may use deceptive practices to trick or force customers into potentially excessive overdraft protection that they didn’t ask for, wringing out overdraft fees.

Are Commerce Bank Overdraft Fees Deceptive?

There are a few ways in which a financial institution, such as Commerce Bank, may trick customers into paying unnecessary or excessive overdraft fees.

While banks are required to leave opting into an overdraft protection program up to their customers, there are other ways to deceive customers regarding overdraft fees.

Some financial institutions may avoid signing customers up for overdraft fees without their permission altogether, but still purposely leave out essential information about their overdraft protection programs.

This may convince customers to sign up for a program that, had they known all relevant information about, they would have opted out of.

For example, a customer may not know about how high Commerce Bank overdraft fees really are before voluntarily singing up for overdraft protection. Other customers may not even be informed that opting out is an option available to them.

Each year, billions of dollars are brought in to banks across the country from overdraft fees alone, reports say.

Not only do financial institutions deceive customers as to the true nature of overdraft protection programs; they may also process overdraft transactions in a way that wrings the most amount out of their customers in fees.

Some banks deliberately process the largest transactions first rather than the order in which they happen naturally, that is, chronologically. Processing transactions from highest to lowest rather than on a natural timeline makes each payment following that transaction more likely to overdraw the account, thereby incurring a fee.

Filing a Lawsuit Over Unfair Overdraft Practices

An inadequate understanding of how overdraft fees work and how banks employ them can lead to customers paying more money in fees than they would have with all the information—which is what these banks are counting on.

Some bank and credit union customers affected by overdraft fees and deceptive practices have begun filing lawsuits against financial institutions.

If you have been subjected to unfair overdraft fee practices, you may be able to join a class action overdraft fees lawsuit.

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