First Midwest Bank Overdraft Fee Class Action Lawsuit

First Midwest Bank is the latest in a long list of banks to be hit with a class action lawsuit over unfairly manipulating the records of checking-account customers to maximize the number of overdraft fees it charges.

 

The First Midwest Bank overdraft fee class action lawsuit claims the bank has the option to accept or decline a transaction at the point of sale if a customer is about to overdraw his or her account. Instead, First Midwest Bank processes debit transactions from the highest to lowest amounts to maximize overdraft charges. The bank is also accused of deducting debits from customers’ accounts before deposits or credits are applied.

 

Lead Plaintiff Lillian Barnes alleges the bank’s practice of re-ordering debit and credit transactions resulted in her being wrongfully charged multiple overdraft fees on numerous occasions. Barnes claims that in one day, for example, she was charged three overdraft fees in the amount of $35 each, for a total of $105, despite the fact that she had deposited enough money in her account to cover the transactions. If First Midwest had posted the transactions from lowest to highest, Barnes claims she would have incurred only one overdraft fee. And if the bank had credited her deposit first, she would not have incurred any overdraft fees.

 

“The overdraft charges assessed to the Plaintiff are representative of millions of dollars in overdraft fees that First Midwest wrongfully assessed and deducted from customers’ accounts,” the First Midwest overdraft fee class action lawsuit states. The practice is especially wrong, the lawsuit continues, “considering the fact that the bank knew at the time of approval whether there were sufficient funds in the account to cover the transaction.” 

 

The First Midwest Bank class action lawsuit is seeking to represent all First Midwest customers who incurred overdraft fees during the Class Period, and is seeking unspecified damages and restitution for Class Members. It is charging First Midwest with unjust enrichment and failing to adequately disclose to customers that they can elect to opt out of overdraft coverage, which means that a debit transaction would be denied if they do not enough money in their account, saving them from incurring fees.

 

The First Midwest Bank Overdraft Fee Class Action Lawsuit joins a long list of suits against banks for their unlawful manipulation of debit transactions, including class action lawsuits and settlement with Bank of America, Wells Fargo, PNC, Union Bank and Fifth Third Bank.