According to the lawsuit, the practice of charging overdraft fees started years ago, before electronic transactions, when customers wrote paper checks on accounts having insufficient funds and banks processed and covered the checks for good customers as a service to facilitate purchases. In this day of debit cards, however, such a courtesy is not necessary because the debit card, like a credit card, can be declined at the point of sale if there are insufficient funds, and the bank can warn the customer that the customer is overdrawn.
According to the lawsuit, BankAtlantic not only failed to decline charges or warn about overdrafts, it also failed to give its customers the option of opting out of such an automatic overdraft protection program. By doing so, the Bank maximized its fees of $35 per overdraft plus an additional $7 sustained overdraft fee for every business day after the customer's account remained negative for five calendar days. The lawsuit also alleges that BankAtlantic used sophisticated software to automate its overdrafts and manipulate debit card transactions by re-sequencing the charges' posting dates and by posting the highest charges first, further maximizing its fees and profits.
According to the lawyer representing the plaintiffs, BankAtlantic collected $38 million in fees in the first half of 2009. It appears that most of it was for overdraft fees, which means that at $35 per overdraft, the Bank imposed over one million separate overdraft fees in six months to thousands of Florida customers.
The plaintiffs are seeking damages to recover all ill-gotten overdraft fees plus interest, for breach of contract; breach of the duty of good faith and fair dealing; unconscionability; unjust enrichment; conversion; and usury.