2 Min Read
* $110 million accord wins preliminary approval
* More than 30 lenders accused of gouging customers
* Bank of America $410 million settlement is largest so far
May 25 (Reuters) - JPMorgan Chase & Co won preliminary court approval of its agreement to pay $110 million to settle nationwide litigation accusing it of charging excessive overdraft fees.
The settlement would resolve lawsuits brought on behalf of more than 1 million people over the fees, which are assessed when customers overdraw their checking accounts by using their debit cards.
Consumers accused more than 30 lenders of trying to boost overdraft fees, which are typically $25 to $35, by reordering transactions from largest to smallest rather than processing them in chronological order.
This can cause fees to be incurred sooner and more often because account balances fall more quickly.
In a Thursday order, U.S. District Judge James Lawrence King in Miami, who oversees the nationwide litigation, called the JPMorgan settlement fair, reasonable and adequate, and certified a class of plaintiffs.
Customers may opt out of the settlement. A final hearing is scheduled for Dec. 10.
Bank of America Corp's $410 million settlement is the largest in the overdraft litigation.
Other banks to settle include Royal Bank of Scotland Group Plc's Citizens Financial unit, which agreed to pay $137.5 million, and Toronto Dominion Bank, which agreed to pay $62 million. Several smaller banks have also settled.
The Citizens and TD accords await court approval.
The case is In re: Checking Account Overdraft Litigation, U.S. District Court, Southern District of Florida, No. 09-md-02036.