HSBC Bank recently agreed to a massive overdraft fee settlement, after numerous customers complained against their overdraft protection practices.

The bank has agreed to pay $32 million in order to the settle the allegations regarding HSBC Bank overdraft fee practices, with class members alleging that bank allowed improper debit card transactions in order to maximize on overdraft fees.

HSBC Bank is one of the world’s largest banks, serving over 47 million customers around the world in 71 different countries Europe, Asia, Africa, North America, Latin America, and the Middle East.

The bank has approximately 6,000 offices worldwide; the bank’s website states that its goal is to help connect customers to opportunities, allow businesses to thrive, and “economies to prosper”.

However, HSBC bank is one of many financial institutions hit with allegations of improperly charging overdraft fees to customers, either signing customers up for overdraft protection without their consent or indexing transactions by purchase amount rather than chronological order.

As of Aug. 15, 2010, banks and other financial institutions became prohibited from charging overdraft fees unless the customer signed up for overdraft protection.

This law came into action after a number of customers complained of large overdraft fees incurring after insufficient purchases, with HSBC Bank overdraft fee practices being the target of one of the most recent settlements.

Overview of HSBC Bank Overdraft Fee Practices Settlement

According to the overdraft fees settlement, HSBC Bank allegedly allowed consumers to make debit card purchases when their accounts contained insufficient funds in order to capitalize on their $35 overdraft fee.

Furthermore, HSBC bank allegedly used a software program which indexed debit card transactions to maximize the overdraft fees. The alleged HSBC Bank overdraft fee practices consisted of indexing transactions from highest to lowest in purchase expense, rather than by date, so there would be less money available for minor purchases.

By indexing debit transactions this way, customers could be charged with multiple overdraft fees rather than one overdraft fee that would have incurred from a chronological order.

New York Supreme Court Judge Eileen Bransten granted initial approval for a settlement of $32 million, with no wrongdoing admitted regarding HSBC Bank overdraft fee practices. The settlement will reportedly reimburse customers approximately 50% of the charges they experienced.

The HSBC class action settlement members include certain HSBC customers in the United States who incurred one of more overdraft fees on one of their HSBC accounts as a result of the improper transaction indexing.

Customers who were charged allegedly improper fees due to the HSBC Bank overdraft fee practices may be able to file legal action.

If you are a current customer who has been charged overdraft fees by HSBC Bank, you may be eligible for legal compensation. An attorney can review your case for free and can help determine if you qualify.

Potential claimants may need to provide attorneys with copies of bank statements, and the information contained in the statements will remain private and confidential.

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