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First Interstate Bank has a practice of unfairly charging $35 overdraft fees on customer accounts when the accounts were never overdrawn, a new class action lawsuit alleges.
Plaintiff Brandy Morris filed the class action complaint against the bank Wednesday in a Montana district court, alleging violations of state and federal law.
Morris, a Montana resident, alleges First Interstate has a “routine practice” of assessing and collecting overdraft fees on accounts that never went negative in the first place.
“This practice breaches contract promises made in First Interstate’s adhesion contracts,” she says.
The plaintiff says customers have been injured to the tune of millions of dollars “bilked from their accounts” in violation of their contracts with the bank.
Morris says she has a checking account with First Interstate, which charges $35 fees for debit card transactions that result in an overdraft.
The claims in her class action relate to overdraft fees charged on what is called “Authorize Positive, Purportedly Settle Negative Transactions” (APPSNT).
She says, when debit card transactions are authorized on an account with sufficient funds to cover the transaction, the bank takes out the money for the purchase and sets it aside. The new balance reflects this.
Therefore, when the funds come out, sometimes days later, the account holder always has enough to make the transaction.
However, Morris alleges First Interstate still “assesses crippling overdraft fees on many of these transactions, and misrepresents its practices in its account documents.”
The class action alleges this is unfair because the bank has put the funds aside earlier for the transaction, thus the fees are improper.
Morris is seeking to represent all Montana citizens who were charged overdraft fees on APPSNT transactions.
She’s suing for breach of contract, breach of fair dealing and unjust enrichment. The plaintiffs are seeking damages, certification of the class action, fees, costs and a jury trial.
This is not the only class action lawsuit over this issue. In Kansas, Sunflower Bank has also been accused of charging “crippling” overdraft fees to customer accounts when the accounts were never overdrawn.
Have you been charged overdraft fees you think were unfair? Let us know in the comments!
The plaintiff is represented by A. Clifford Edwards of Edwards & Culver.
The First Interstate Bank Overdraft Fees Class Action Lawsuit is Brandy Morris, et al., v. First Interstate Bank, Case No. 1:21-cv-00076-SPW-TJC in the Montana Thirteenth Judicial District Court Yellowstone County, Montana.
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7 thoughts onFirst Interstate Bank ‘Bilked Millions’ in Unfair Overdraft Fees From Customer Accounts, Class Action Claims
We have a checking account with first interstate bank which took over great western bank. Since the take over we are charged regularly for overdrafts that we do not understand. We never had this problem with great western bank. There is an overdraft fee on Dec 8 2021 for example that does not show what the fee is charged for just that there was an overdraft charge. It’s setting us back weekly further into debt.
When will I receive my settlement?
Add me on
FiB did same to me.. Terrible bank.
Please add my to this same issue. Thank you!
I closed an account with First Interstate Bank and the account is still receiving overdraft fees. I have spoken to the bank on 7 different occasions about the closed account and they took from my other open account to cover these fees. They are taking money from me that I need to pay other bills. Because of this I will be in default on other monthly obligations.
Please, please add me