Overdraft practices at HSBC Bank are under investigation for possibly charging excessive overdraft fees.
Just two years ago, HSBC Bank settled a class action lawsuit for $32 million. The bank stood accused of posting transactions to customer accounts in a specific order that incurred more overdraft fees.
Although the bank agreed to the settlement, bank management did not admit to any wrongdoing and said no laws were violated.
Banks and Fees
Banks make money by incorporating overdraft fees. Overdraft practices at HSBC Bank and other financial institutions generate profits and are included in annual budgets.
Overdraft protection programs are sold to customers who believe they are truly obtaining a benefit from the protection. Sometimes, they are grateful that a transaction is covered, especially if it is something such as a mortgage check.
However, Pew Charitable Trusts conducted research that determined most consumers would rather have a lesser purchase declined rather than incur an excessive fee; most consumers would prefer to have a $10 lunch debit purchase declined rather than incur a $35 overdraft fee to cover the meal.
Pew also studied records and data from the Federal Deposit Insurance Corp (FDIC). Service fees and overdraft fees “have more than doubled while interest income has decreased” over the past 30 years.
Overdraft Practices at HSBC Bank Harm the Poor
Consumers living paycheck to paycheck pay the most in overdraft fees. Pew found that Americans who earn less than the national median income of $54,000 per year are harmed the most by overdraft fees.
Vulnerable citizens tend to pay more fees when impacted by overdraft practices at HSBC Bank. Nearly one-fourth of heavy overdrafters owed the equivalent of one week’s worth of wages to overdraft fees, said the Pew study.
Financial institutions began charging overdraft fees and other fees several years ago when they realized interest rates were so low that they were not making enough money through interest alone. Pew analyzed the figures and determined that financial institutions made $33 billion in overdraft fees in 2016.
In recent years, banks have faced class action lawsuits because of deceptive overdraft practices. In some cases, financial institutions continue to promote consumer “protection” plans that offer more benefits to the bank itself than to the consumer.
Processing a consumer’s transactions in an order that will maximize the number of overdraft fees incurred is just one way some banks and credit unions have deceived consumers. Other times, a bank will allow a customer to continuously overcharge a checking account, regardless that the account is depleted of funds. Such action allows the overdraft fees to add up too.
Overdraft practices at HSBC Bank and other financial institutions are under the microscope as consumers fed up with paying exorbitant fees demand compensation through class action lawsuits.
Do YOU have a legal claim? Fill out the form on this page now for a free, immediate, and confidential case evaluation. Some of the banks and credit unions being investigated include, but are not limited to:
- HSBC Bank
- UMB Bank
- State Employees Credit Union
- Pentagon Federal Credit Union
- Boeing Employees Credit Union
- Alliant Credit Union
- Star One Credit Union
- First Technology Federal Credit Union
- America First Credit Union
- American Airlines Federal Credit Union
- Alaska USA Federal Credit Union
- Vystar Credit Union
- Citizens Equity First Credit Union
- Teachers Federal Credit Union
- ESL Federal Credit Union
- Patelco Credit Union
- DFCU Financial Credit Union
The attorneys who work with Top Class Actions will contact you if you qualify to let you know if an individual lawsuit or class action lawsuit is best for you. Hurry — statutes of limitations may apply.
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Join a Free Bank & Credit Union Overdraft Fee Class Action Lawsuit Investigation
If your bank and credit union has engaged in deceptive overdraft fee practices, you may have a legal claim. Fill out the form on this page now to find out if you qualify!
An attorney will contact you if you qualify to discuss the details of your potential case.
In order to properly investigate overdraft fee claims, you may be required to disclose bank statements to overdraft fee attorneys. Please note that any such information will be kept private and confidential.
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