Excessive Overdraft Fees and NSF Fees: Who’s Affected?
Were you unfairly charged overdraft fees and/or non-sufficient funds fees (NSF fees) by any of the financial institutions listed below?
- GTE Financial Credit Union (Florida)
- Dollar Bank
- First Financial Bank
- Zions Bancorp
- Atlantic Union Bank
- Carter Bank & Trust
- Bank of the Sierra
- Kearny Bank
- Axos Bank
- Middlesex Savings
- TBK Bank
- Civista Bank
These banks and credit unions may be engaging in deceptive practices related to overdraft fees and/or NSF fees.
Although overdraft fees and NSF fees are not illegal, many bank and credit union customers have filed class action lawsuits alleging that the financial institutions where they bank are taking advantage of them by charging excessive and repetitive overdraft and NSF fees.
What Are NSF and Overdraft Fees?
Non-sufficient fund (NSF) fees are charged when a low account balance causes a transaction or check to be rejected.
NSF fees are also sometimes referred to as “returned item fees.” If you attempt to make a withdrawal at an ATM or see a “non-sufficient funds” notice on your bank statement, you have attempted to withdraw more money than is actually in your account.
In these situations, the bank or credit union can refuse to let the payment go through, and then charge the customer an NSF fee.
Overdraft fees are similar in that they are fees charged on transactions made with low account balances, according to Investopedia — however, the key difference is that overdraft fees are charged after the financial institution actually allows the transaction to go through. It then charges a fee in exchange for allowing that transaction.
Overdraft fees cannot legally be charged in most cases unless the consumer has first voluntarily opted into their financial institution’s overdraft protection program.
In summary, according to Investopedia, banks charge NSF fees when they return presented payments, such as checks, and overdraft fees when they accept checks that overdraw the customer’s checking account.
Read more: How Many NSF Fees Can A Bank Charge?
Is There a Limit on NSF and Overdraft Fees?
NSF fees are capped under state laws, limiting the amount a consumer can be charged for a single NSF fee, according to Wallet Hub. In several states, that cap is at $20, $25, or $35. Delaware and Mississippi are two of the states with the highest flat limits, at $40 per fee.
In some states, such as Florida or Georgia, certain NSF transactions are limited to a percentage of the bounced check amount rather than a flat fee.
Overdraft fees also vary widely, but are typically around $35, Nerdwallet reports. Some individual banks and credit unions cap the number of fees that can be charged per day, while others do not — at some banks, the total amount of fees accrued within a day can reach up to $228.
Excessive NSF and Overdraft Fees
Unfortunately, consumers at a number of financial institutions may be facing excessive NSF and overdraft fees.
These kinds of fees generate considerable profit for banks and credit unions, with consumers paying $34 billion in overdraft fees alone in 2017, according to Forbes.
Banks and credit unions may also be charging multiple NSF fees on the same transaction after attempting to process a charge multiple times in a row.
With both overdraft and NSF fees, a fee of $35 or so that gets charged multiple times in a row can quickly lead to fees of more than $100 for a single overdrawn or failed transaction.
Lake City Bank, Kearny Bank, and several others are all under investigation for potentially engaging in unfair or improper NSF or overdraft fee practices.
In a similarly filed lawsuit, Bethpage FCU was hit with litigation over its allegedly unfair and excessive fees. The suit alleged Bethpage wrongfully charged its users overdraft fees in instances when they should not have been charged as a result of an “accounting gimmick.”
Join a Free Overdraft and NSF Fee Class Action Lawsuit Investigation
A growing number of consumers are coming forward with complaints that their banks are using unfair practices to incur the highest amount of NSF or overdraft fees possible for a single transaction. Unfortunately, excessive fees like these will most often and most significantly hurt the Americans who can least afford it, especially at a time when many are out of work and struggling to make ends meet.
If you have been charged an overdraft fee or NSF fee by one of the financial institutions listed above, you may be able to join a free class action lawsuit and pursue compensation. Filing a lawsuit can be a daunting prospect, so Top Class Actions has laid the groundwork for you by connecting you with an experienced attorney. Consulting an attorney can help you determine if you have a claim, navigate the complexities of litigation, and maximize your potential compensation.
The qualified attorneys that work with Top Class Actions are highly experienced in filing class action lawsuits. Fill out the form below to be connected with an attorney and find more about how you can take action for excessive overdraft and NSF fees.
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