In 2010, Congress passed the Dodd-Frank Financial Wall Street Reform and Consumer Protection Act and consumers won some relief from outrageous charges by banks.
But, for as much as Dodd-Frank did to protect consumers, it did not stop every way banks could take advantage, including extreme overdraft fees.
A new report actually raises questions about the law’s tools to control overdraft fees. According the study by Pew Charitable Trusts, more than 80% of the 50 U.S. banks in the study continue to charge overdraft fees on ATM and debit card transactions, generating 400% more in revenue than other banks who do not charge for those transactions.
The typical overdraft fee is between $35 and $40.
“[Our] research has shown that many of the largest U.S. banks engage in practices that increase costly debit card overdraft fees, although some have voluntarily opted not to do so,” Pew said. “Overdraft fees are a major reason that many checking account holders exit the banking system, which reduces their access to lower-cost, mainstream financial services and puts them at greater risk of loss or theft of their funds.”
Still, with billions in potential profits to be made, banks don’t appear to be eager to reduce or change the way they collect their fees.
“The fees being levied on bank consumers by some banks is outrageous,” said William E. Crutchfield, CEO at Serious Business Consultants Incorporated, a commercial financing services company based in Columbia, Maryland. “Banks use fees as a profit center…this situation gives banks the opportunity to place fees on overdrafts, account maintenance, and for maintaining a specific level of funds.”
Despite federal rules on overdraft fees that went into effect in with the Dodd-Frank Act in 2010, many credit union and banking customers are still paying excessive overdraft fees. With the opportunity to make billions in profits, it is unlikely a change regarding excessive overdraft fee practices will occur anytime soon.
Overdraft Fee Class Action Lawsuit Investigation
Since July 1, 2010, credit unions and banks are required to ask new customers if they wish to opt in to overdraft protection. There is no legislation regarding how much money can be charged for overdraft fees and many consumers are not aware of their options when it comes to overdraft.
An overdraft fee class action investigation has been launched in response to consumer reports that many of these financial institutions have unfairly raised overdraft fees.
Consumers claim that many overdraft programs assess fees on the available balance, which, in turn, may cause an overdraft fee to be charged even if the actual account balance did not go negative. Also, credit union and banking customers claim they were misled by the financial institutions by not being informed of their available balance prior to the transactions that led to overdraft fees.
Do YOU have a legal claim? Fill out the form on this page now for a free, immediate, and confidential case evaluation. The attorneys who work with Top Class Actions will contact you if you qualify to let you know if an individual lawsuit or class action lawsuit is best for you. Hurry — statutes of limitations may apply.
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Join a Free Credit Union Overdraft Fee Class Action Lawsuit Investigation
If your credit union charged you overdraft fees, you may have a legal claim. Fill out the form on this page now to find out if you qualify!
An attorney will contact you if you qualify to discuss the details of your potential case.
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