US Bancorp settles overdraft fee case for $55 million

Mon Jul 2, 2012 1:33pm EDT

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(Reuters) - US Bancorp, one of the 10 largest U.S. banks, has agreed to pay $55 million to settle lawsuits accusing it of imposing excessive overdraft fees on customers.

The settlement by the Minneapolis-based lender was revealed on Monday, six days after a $90 million accord with similarly-sized PNC Financial Services Group Inc was announced.

It is part of nationwide customer litigation against 35 lenders over the fees, which are typically assessed when customers overdraw their checking accounts by using debit cards.

Brought on behalf of millions of customers, the lawsuits accused banks of ordering transactions from largest to smallest, rather than processing them in chronological order. They said this let banks charge overdraft fees, which are typically $25 to $35, sooner and more often because account balances fell faster.

Fourteen lenders have settled, according to lawyers for the customers. Bank of America Corp's $410 million accord is the largest, followed by a $137.5 million settlement with Royal Bank of Scotland Group Plc's Citizens Financial unit and a $110 million settlement with JPMorgan Chase & Co.

US Bancorp's settlement requires approval by U.S. District Judge James Lawrence King in Miami. He oversees litigation over the fees, which was consolidated before him in 2009.

Teri Charest, a US Bancorp spokeswoman, said the bank is pleased to resolve the matter and has made changes in recent years in how it handles customer accounts.

Citigroup Inc, Wells Fargo & Co and Capital One Financial Corp are among the larger banks that have not settled.

The case is In re: Checking Account Overdraft Litigation, U.S. District Court, Southern District of Florida, No. 09-md-02036.

(Reporting By Jonathan Stempel in New York; editing by John Wallace)

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Comments (1)
r-turo wrote:
Bank of America, where’s my money at?? You knowingly excessively charge me over-draft fees at $35 a piece times 11. I made a purchase at 8pm in the evening, which resulted in an over-draft fee, but yet there was a $700 plus dollar deposit coming in at mid-night, a deposit that I received like clock work every week. However, the real crooks are in the White House and in the many buildings that surround it. WAKE UP, America!!

Jul 02, 2012 2:24pm EDT  --  Report as abuse
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