U.S. Bank Settles Overdraft Case

American Banker 
July 3, 2012
Horwitz, Jeff

Just days after PNC Bank reached an accord on overdraft fees, U.S. Bank has agreed to a $55 million settlement centered around its overdraft policy. Plaintiffs in the case alleged that the bank, along with dozens of its peers, processed customers' debit card payments out of chronological order at the end of each day. Subtracting the biggest transactions first from customer accounts allowed the banks to delete the funding faster and trigger more overdraft penalties. While the plaintiffs have not yet revealed the total cost of the debit re-sequencing for U.S. Bank's customers, the payout may be smaller as a percentage of the alleged damages than that awarded to plaintiffs in the other cases. One likely reason for this is that U.S. Bank had mandatory arbitration clauses built into its checking contracts, which could have allowed it to escape from the class action.
Web Link

Return to Headlines

Abstract News © Copyright 2008-2013 INFORMATION, INC.