In another banking related news story, Wells Fargo & Co. should pay about $203 million to customers who claim the bank manipulated debit card transactions without their knowledge to increase revenue from overdraft fees, a federal judge ruled. That again is $203 Million. Dollars. In a time where people are out of work and struggling with money, you don't expect this type of customer service.
U.S. District Judge William Alsup in San Francisco issued the ruling Tuesday, deciding the case without a jury.
The San Francisco bank changed the way it treated customers' daily debit transactions and cash withdrawals in December 2001, according to the lawsuit filed in 2007. Transactions with the highest dollar amount posted first, rather than in the order they occurred. Does this practice sound familiar to you ?
The practice resulted in more overdrafts, with customers overdrawing their accounts by small amounts multiple times a day, according to the complaint. The change allegedly was intended to boost revenue from overdraft fees, which ranged from $18 to $35 for each overdraft.
Customers don't "reasonably expect that they will have to pay up to ten overdraft fees when only one would ordinarily be incurred," Alsup wrote in the opinion. The multiple fees are "so pernicious ( harmful )," he said, that they should only be allowed if customers expected them and in this case "the proof is the opposite."
Wells Fargo "went to great lengths to bury the words deep in a lengthy fine-print document and the words selected were too vague to warn depositors, as even the bank's own expert conceded," Alsup wrote. This is very common when you get your statement. Read the statement you have now for your bank and see if you spot any changes. Difficult huh? "I will start reading my statements more carefully," said Thomas of Oakland. " It is wordy and takes time, but everyone should read it."
The lawsuit, filed by three customers on behalf of thousands of Californians charged overdraft fees, claimed the practice was unfair, deceptive and fraudulent and sought more than $350 million, plus punitive damages. Three people can make a difference.
Wells Fargo, as most losers is a suit do, will appeal the ruling, which isn't "in line with the facts of the case," spokeswoman Richele Messick said in a phone interview, according to Bloomberg News.
Comments
I recall getting raped by Wells Fargo as it relates to overdraft fees. I swore it was intentional! So much so that I canceled my account and moved over to Bank of America. I hope I can get in on this lawsuit by virtue of being a previous account holder.
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