$55 Million Settlement Announced In U.S. Bank Overdraft Fee Class Action
CORAL GABLES, Fla., July 2, 2012 /PRNewswire/ -- U.S. Bank has agreed to pay $55 million to settle class action lawsuits that accused the bank of improperly manipulating its customers' debit card transactions in order to generate excess overdraft fee revenues. The lawsuits, part of multidistrict litigation involving more than 30 different banks entitled In re Checking Account Overdraft Litigation, are pending before U.S. District Judge James Lawrence King in Miami.
The lawsuits claim that U.S. Bank's internal computer system re-sequenced the actual order of its customers' debit card and ATM transactions, by posting them in highest-to-lowest dollar amount rather than in the actual order in which they were initiated by customers and authorized by the bank. According to the lawsuits, U.S. Bank's practice resulted in its customers being charged substantially more in overdraft fees than if the debit card and ATM transactions had been posted in the order in which they were initiated and authorized.
"We are pleased to have achieved this result for U.S. Bank customers who were adversely affected by this anti-consumer practice," said Robert C. Gilbert, Plaintiffs' Coordinating Counsel, who oversees and manages this multidistrict litigation with Co-Lead Counsel Aaron S. Podhurst and Bruce S. Rogow.
Gilbert noted that the Supreme Court's 2011 decision in AT&T Mobility LLC v. Concepcion created serious obstacles for U.S. Bank customers pursuing these claims: "As a result of Concepcion, U.S. Bank customers face the prospect of being forced to pursue their claims through individual arbitrations, rather than through a class action in a court of law. Forcing U.S. Bank customers to pursue these claims through individual arbitrations closes the courthouse doors and effectively deprives them of a meaningful opportunity to recoup the damages they've suffered as a result of this anti-consumer practice."He expects the settlement with U.S. Bank to be presented to the Court for preliminary approval within ninety days.
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