Update:
- A federal judge gave initial approval to a $32.2 million settlement between TD Bank and its customers over overdraft fees.
- U.S. District Judge Karen M. Williams approved the deal with a class that includes TD Bank checking account owners whom the bank charged overdraft fees for transactions that occurred when an account balance was positive but processed when there were insufficient funds to cover the transaction between June 27, 2019, and Sept. 30, 2022.
- The settlement includes a $22 million payout that includes $10.3 million in overdraft fee forgiveness.
TD Bank overdraft fee class action lawsuit overview:
- Who: TD Bank has moved an overdraft fee class action lawsuit from a district court to federal court in New Jersey.
- What: The lawsuit accuses the bank of illegally accessing overdraft fees and swindling customers out of millions of dollars.
- Where: The claim is for TD customers nationwide.
(Oct. 13, 2021)
TD Bank has moved a class action lawsuit accusing it of illegally accessing overdraft fees and swindling customers out of millions of dollars from a district court to federal court in New Jersey.
The bank says in the order of removal that the putative Class Members are aggregated to determine $5 million in controversy, which is required for a federal court case.
“Although TD Bank denies liability and denies Plaintiff’s theories and claims of damages, the Complaint seeks class-wide damages, in the aggregate, that exceed the $5,000,000 amount in controversy requirement …,” the bank says, adding the consumers are nationwide making federal court the most applicable venue for the case.
TD Bank overdraft fee class action lawsuit
The class action lawsuit was filed in August by lead plaintiff Kyle Burns who is seeking damages, restitution, and declaratory relief from TD Bank for alleged unfair and improper assessment and collection of overdraft fees.
Burns alleges the bank breaches its contractual promises, which include that TD will reduce balances to reflect debit card transactions immediately, therefore stopping approved debit card transactions from being assessed an overdraft fee.
TD nevertheless charges overdraft fees on these transactions, Burns says.
“TD also breaches its duty of good faith and fair dealing when it charges OD Fees even when customers did not actually have insufficient funds because the funds were taken from the available balance and held at the time of approval,” he says in the lawsuit.
The bank’s customers have been injured by TD bank overdraft fees to the tune of millions of dollars taken from their accounts in violation of their agreements, Burns states.
The lawsuit challenges the practice of charging overdraft fees on Authorize Positive, Purportedly Settle Negative (APPSN) Transactions. A number of banks are facing class action lawsuits over this same practice.
“There is no justification for this improper practice, other than to maximize TD’s OD Fee revenue,” Burns alleges.
“APPSN Transactions only exist because intervening checking account transactions supposedly reduce an account balance. But TD is free to protect its interests and either reject those intervening transactions or charge OD Fees on those intervening transactions—and it does the latter to the tune of millions of dollars each year.”
Burns wants to represent TD customers nationwide and is suing for breach of contract. He seeks certification of the Class, damages, restitution, declaratory relief, interest, legal fees and costs, and a jury trial.
In 2019, TD Bank agreed to pay a $70 million class action settlement to end claims the bank charged excessive overdraft fees.
Do you bank with TD? Tell us about your experience with TD Bank overdraft fees in the comments section below!
Burns is represented by Kenneth J. Grunfeld and Richard M. Golomb of Golomb Spirt Grunfeld PC and E. Adam Webb of Webb Klase & Lemond LLC.
The TD Bank overdraft fee class action lawsuit is Burns v. TD Bank NA, Case No. 1:21-cv-18194, in the U.S. District Court for the District of New Jersey.
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74 thoughts onJudge gives preliminary approval to $32.2M TD Bank overdraft fee settlement
I would love to find out how to apply for this!
I closed my account with them because every week this was happening to me. I just thought this can’t be possible and since I stopped banking with them I have not had the issue with over draft fees sometimes it would be 3 transactions and I’ll be charged $105 in overdraft fees.
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