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 fees, AT&T agreed to a tentative settlement in a class action it’s currently facing over early termination fees (ETFs). You could argue they’re a little like overdraft protection fees—in that opting out seems to nigh on impossible. Who thought that strategy up? 

The settlement will reportedly net qualified plaintiffs a total of $16 million in cash and a further $2 million in non-cash benefits—but they have to file claim forms before June 14, 2010.

To be eligible for a claim you must have “subscribed to wireless telephone service from AT&T Mobility LLC (“AT&T Mobility”) or its predecessors and paid or were charged a flat-rate early termination fee (“ETF”) at any time after January 1, 1998,” or “Your contract included a flat-rate ETF provision at any time after January 1, 1998.”  A court date for settlement approval has been set April 14, 2010. 

Overtime? Yeah, we’ve got that… Now. Employees past and present who took part in the class action against Staples Inc, should be breathing a sigh of relief this week as the office supplies retailer proudly announced it had reached a tentative $42 million settlement in “several” wage and hour class actions.   

While the announcement didn’t specify how many lawsuits this settlement could resolve, the lawsuits cover some 5,500 ‘associates’—also known as store managers—who have claims dating as far back as 2002. That’s a long time to be out of pocket. I wonder who really came out ahead here…

That’s it for this week – see you at the Bar!

One thought on “Week Adjourned: 1.29.10”

  1. You need to check out Wachovia Bank for the same fraud. They have been manipulating bank accounts for years with this sneaky manuever. Also they let you charge using your debit card with no existing funds when the charges should be denied or not approved so you have to pay overdraft fees @ $35-$40 per charge. Something needs to be done about them. This is robbery!!!!

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