Bank of America Agrees to Pay $410 Million to Settle Overdrafts Lawsuits

[ProSense]

Source: Bloomberg

Bank of America Corp., the largest U.S. lender by assets, agreed to pay $410 million to settle lawsuits alleging deceptive practices in the management of customer accounts that led to excessive fees for overdrafts.

The settlement was dated Jan. 27, according to a court filing by Bank of America and lawyers for consumers. Overdraft class actions, unified in 2009 from across the country in Miami federal court, alleged breach of contract, unjust enrichment and usury by more than two dozen banks. Institutions including Citigroup Inc., JPMorgan Chase & Co. and Wells Fargo & Co. were named in related lawsuits.

Miami resident Ralph Torres described in his suit against Bank of America how he opened an account in 2000 after seeing advertisements for “free checking.” Torres alleged he was tricked into believing he had more money in is account than was the case, and that Bank of America debited his funds in a way that made it more likely he would incur overdraft fees.

“The bank actively provides false or misleading balance information to these customers, including plaintiff, that in turn deceives these customers into making additional transactions that, in turn, will generate even more overdraft fees for the bank,” Torres’s lawyers wrote in the complaint.



Read more: http://www.bloomberg.com/news/2011-02-05/bank-of-america-to-pay-410-million-to-settle-overdraft-case.html?cmpid=wsdemand

[beyurslf]

1. They are deceptive. I remember telling them that when I closed my accounts with them.

They got away with it for years so this settlement is probably pocket change.

[Trajan]

2. I had that argument with them in the late 90's

Bank Statement in hand, I spoke to a bank manager, and went over the statement, step by step, and show receipts for EVERY item on the day they charged me with 4 NSF's ...

They nailed me with about $130 in NSF fees .... I was fucking livid ! ...

I told him "Funny how that worked - You, holding up my deposit from posting, which was the FIRST transaction of the day, and allowing the account to sink, debit by debit in a timely manner, and ALL after the deposit was made, until finally, they posted my deposit late in the evening ... "

"Good thing too", I said, because "then I had money in my account to pay the bogus $130 ! ".

He removed the NSF's and apologized ...

Bastards ! .... They got away with more than that .... I want some of that money !

[Lugnut]

3. That was when I dumped them.

When they started monkeying around with deposits and making those funds not available it was the last straw. My accounts have been with the local credit union since then.

[Darkhawk32]

4. Made check deposit at 3:15pm........

at my local branch. Was told that since it was the weekend (Friday after 2pm) that I could use my Visa debit card and that all transactions would be held in stasis until Monday morning until my paper payroll check "cleared".

Come Monday morning, they processed all my weekend transactions FIRST and then deposited my check.

Not only that, they put the transactions not in order in which they were reported to them, but from highest to lowest amount. This ensured that the FIRST transaction made my account go BOING. Then the next 8 transaction also made it go BOING.

$35 x 9 = $315 in overdraft fees.

When I saw those on my account, I called them up and complained and they reversed 4 of them... but still cost me $175.... grr!!!

How do I get in on this suit?

[Trajan]

8. Exactly ...

They have since changed their policies .... They no longer account for them like that ...

I have had few encounters with NSF's in recent years, but those times I did, B of A were VERY kind, and did not charge me a dime ...

I believe their policy is this now: IF your account is negative at the EOB, every day, for 5 days in a row, THEN you will incur an NSF fee .... and the fees are smaller now ...

I was surprised, and happy I wasn't feeling raped again ...

Still, like you, They owe my family .... Those kinds of inordinate fees can wreak havoc on a family's tight budget, and they did ...

[Darkhawk32]

9. From the BofA website....

What is an Overdraft Item fee?

An Overdraft Item Fee is charged when you write a check or make a withdrawal for an amount that is more than the balance in your checking or savings account and we pay the transaction.
You are not charged Overdraft Item Fees when we determine your account is overdrawn by a total amount less than $10 after we finish processing for the day.

When we determine your account is overdrawn by a total amount of $10 or more, you are charged a $35 overdraft item fee for each overdraft item.
Although Bank of America is not obligated to pay an item if your account is overdrawn, the bank may pay these items as a courtesy to you. If you are charged an overdraft item fee, you can view details in your Online Banking transaction record.

[Matariki]

5. Excellent news.

Although they'll probably try to figure a way to pass that fee on to their customers...

[junior college]

6. BofA is rotten bank but Wells Fargo is no better. I hope they go belly up n/t

[Curtis]

7. Got that right

BofA repoed a car of mine back in the 80s claiming lack of insurance though I had full coverage and HAND delivered proof to the loan agent THREE times over a 6 month period. Then they wanted $3K to get the car back.

Wells Fargo processed a direct deposit on a Monday, that actually showed on a Friday online like it should have, AFTER they processed every monthly bill and groceries and other items I bought over the weekend leaving me with 15 OD charges at $39 a pop. They refused to work with me so I just closed the account. I kept trying to point out that the OD charges were $585 yet my account only showed -$490. The math didn't add up. Still 5 years later a collection agency sends me a bill saying I owe them now because the bought the debt from WF. Sorry about their luck as they are a non-reporting agency so they lost out.

Anyway, both are the devil.

[rhett o rick]

10. Dont hope they go "belly up" or we will have to bail them out again. nm

[rhett o rick]

11. I am betting very little will actually make it into the hands of the victims.

the lawyers will take a high percentage and the victims will have to provide proof to collect. Many wont have the proof, or just wont bother.

[defendandprotect]

12. Banksters are criminals and our Congress is permitting it all --

[quakerboy]

13. It goes beyond deceptive practices. They are flat thieves.

I have not had to deal with nsf fees or any of that, fortunately. But I quit banking with them because they were flat out stealing from me.

At the time, every few weeks, I had a deposit that often involved a fair amount of coin. I had counted it and bagged it. They do not have coin counting machines in branch here, so they put it in a sealed bag to send to the vault, and then adjust your deposit if the count comes up off what you told them. I had 6 in a row get adjusted down, by a few bucks each time. Every now and again, I am human, I could make a mistake. But not that much that often, particularly when I start being really careful after coming up off count once.

So I hopped over to a different bank, bought a bit over a hundred bucks in rolled coin, dumped it in the bag and turned it in. Sure enough, a few days later my deposit was adjusted down again. Closed my account immediately, and I will never do any cash business with them again.