Week Adjourned: 1.29.10

Citizens Bank under fire for Overdraft FeesTop Class Actions 

Citizen of your Wallet? It seems that no amount of bad PR or more importantly, federal regulations, are effective deterrents against bad business practices by banks. This week, a potential class action lawsuit was filed against Citizens Bank alleging that customers have been unfairly charged overdraft fees. Sound familiar? It should. This is just one in a spate of similar lawsuits involving overdraft fees—including a class action against Bank Atlantic, in November 2009. 

In this particular lawsuit, Citizens Bank could be on the hook for hundreds of millions of dollars it allegedly unlawfully charged its customers by manipulating debit transaction postings to generate overdraft fees. In other words, CB seemingly put its customers into debt deliberately so it could charge overdraft fees. You do that to enough customers and presto—you’re rich—possibly even rich enough to afford those six figure senior management bonuses. 

And the kicker? The fees were imposed under the guise of an ‘overdraft protection plan’ that the lawsuit alleges customers were not allowed to opt out of. I guess the epitaph to this could be—they don’t have your back—they have your wallet. 

Top Settlements

If you Leave me Now, You’ll Pay an Early Termination Fee… (ok, so I’m not a lyricist) Keeping on the theme of Continue reading “Week Adjourned: 1.29.10”

Week Adjourned: 1.22.10

AbbaRoberta FlackSteve MillerPink Floyd

Top Class Actions

Killing Me Softly with his Song…killing me softly… Sorry. Just lost in time there…along with this one. I don’t know if this is the longest class action filed in recent history—but it certainly does cover a significant period of time—36 years, if my math is correct. It was filed against The Variable Annuity Life Insurance Company (“VALIC”) who’ve allegedly been up to no good for the period between January 1, 1974 and January 8, 2010. 1974? Now that’s a blast from the past. There was no public internet in 1974…people bought records—not CDs…Remember Disco? The Joker? Ok. I’ll stop there.

So what’s the beef? Bottom line, “According to the complaint, class members were harmed by entering into expensive annuity contracts that were redundant and unnecessary.” Of course, there’s a bit more to it than that, like, “VALIC agents failed to disclose that the tax deferral feature of the deferred annuity was redundant and unnecessary for Class members…and that these materially false and misleading statements and omissions fraudulently induced purchases of the deferred annuities because they give the impression that the product provides the key tax deferral benefit sought by investors, when, in fact, tax deferral is not a reason for qualified plan investors to purchase the product because any investment funding a qualified plain is already tax deferred.” 

Suffice to say, people were sold investment products that they didn’t need. I guess some things really don’t change with time.

Top Settlements

The Now Network gets the Now Settlement. Finally. On Thursday, a federal judge approved a $17.5 million settlement in the class action against Sprint Nextel. Chalk one up to consumers! The lawsuit arose over the flat Continue reading “Week Adjourned: 1.22.10”

Week Adjourned: 1.15.10

Delta giving new meaning to baggage claim?Top Class Actions

New meaning to Baggage Claim? Delta Airlines and AirTran Airways got hit with a class action lawsuit this week, for nickel and diming passengers on baggage fees. You know—the extra money you have to pay to check your luggage that contains all the stuff you can no longer take on board in your carry-on luggage…

Bottom line—the suit alleges price fixing by the two airlines. “The suit accuses the two carriers of colluding to charge fliers a $15 first checked baggage fee. The complaint claims the two carriers agreed to charge the baggage fee in highly competitive markets because neither could risk losing business by charging the fee on their own.”

Given that there are tens of thousands of us who fly across the US every day—I think the potential class of plaintiffs submitting a claim could be huge on this one—makes you wonder if you’d actually get $15 back, which is what the lawsuit is seeking… 

Sterling Performance? Employees at Sterling Savings Bank, a Spokane, Washington-based institution, got wise to their employers and filed a class-action lawsuit claiming that the bank and its holding company, Sterling Continue reading “Week Adjourned: 1.15.10”