Uber and Lyft Charges May Be Costing Consumers Unauthorized Bank Fees

Consumers are finding that commercial transactions on some apps are being misclassified by their banks as “recurring” and are thus leading to unauthorized bank fees. If you have been charged unauthorized bank fees after making a one-time payment to Uber or Lyft that was misclassified as recurring, you may have a legal claim.

Many banks offer an “overdraft protection” program, which allows customers to spend more money than is in their account, for a fee. These services are advertised as a feature that gives consumers more flexibility with their money. The service can also be deceptive, because consumers end up spending more money than they have, leading them to rack up costly fees.

For this reason, the federal government prohibits banks from charging consumers overdraft fees, or from enrolling them in overdraft protection fees without the consumer actively opting in and signing up for such a program. There are some exceptions to this rule, however. Under federal law, banks are permitted to charge overdraft fees without a customer opting in to an overdraft protection program if the overdraft occurs as a result of a recurring payment causing the customer’s account to go into overdraft.

Recurring and one-time charges are treated differently under overdraft disclosure rules, and thus they are processed differently by banks. Transactions classified as “recurring” could trigger an overdraft fee if the bank has applied overdraft protection service to that account. Merchants making the charge to a customer’s account classify the charges as either one-time or recurring.

Recently, consumers have found that in some cases, their app transactions have been incorrectly classified as recurring transactions instead of one-time charges. In these cases, if the consumer does not have sufficient funds to cover the cost of the charge, the charge is allowed to go through and they are charged an allegedly unauthorized bank fee for the overdraft. Consumers say that instead, the charge should be declined, and the consumer should not be charged a fee.

In many cases, consumers do not notice these charges being made, so they continue to make charges on the apps, leading to the fees piling up over time.

Notably, consumers have noticed these unauthorized bank fees occurring from charges made with accounts linked to apps on their phones. Businesses like the following have been suspected of misclassifying one-time charges as recurring.

• Amazon Digital
• Apple Pay
• Google Play
• GPAY
• PayPal
• Venmo
• Cash App
• SamsungPay
• Sling TV
• Square
• iTunes

Additionally, many food-ordering apps, parking apps, gas station apps, and public transit apps have been associated with unauthorized bank fees. These additional and allegedly improper overdraft charges can add up quickly, leading consumers to spend much more money in association with the apps than they otherwise would, or ever intended to spend.

Currently, lawyers are investigating if the ride apps Lyft and Uber have been associated with misclassified transactions. Millions of consumers use these apps, so many people may have been improperly charged fees in association with their use of these apps. If you feel that you have been improperly charged overdraft fees after using Uber or Lyft, joining an app overdraft fee lawsuit could help you gain compensation for your financial injury.

Join a Free Uber and Lyft Bank Fees Class Action Lawsuit Investigation

If you were wrongfully charged an overdraft fee from an app or digital service even though you did not agree to allow your bank to charge you overdraft fees, you may qualify to file a recurring bank fee class action lawsuit.

Learn More