Dacotah Bank Overdraft Fees for Accounts Not Overdrawn Class Action

Recently many class actions have complained about improper overdraft or non-sufficient funds fees, which add to the profits of banks and credit unions. The complaint for this class action alleges that Dacotah Bank charges customers overdraft or non-sufficient funds fees on items that do not actually overdraw accounts.

The class for this action is all Dacotah account holders who, during the applicable statute of limitations, were charged overdraft fees or non-sufficient funds fees on items that did not overdraw their checking accounts. A North Dakota Subclass has also been proposed, comprised of all such checking account holders in North Dakota.

The complaint quotes Dacotah’s Account Agreements as saying that “an ‘overdraft’ is only a ‘withdrawal request that overdraw[s] your account’ or ‘account balance.’” The complaint claims that the Agreement does not define the “account balance” or state any particular manner in which account balances are calculated when determining overdrafts.

The complaint further asserts that plaintiff Stacey Schultes was charged overdraft fees on certain transactions even though his monthly statements indicate that they did not overdraw his account.

Plaintiff Schultes’s account is supposedly governed by the documents. The complaint alleges that these documents, when discussing overdraft an non-sufficient funds fees, “promise that Dacotah will only charge OD Fees or NSF Fees on items which would place the account in the negative.” However, the complaint alleges that Dacotah does in fact impose OD or NSF fees on transactions that did not place the account in the negative.

For example, the complaint alleges that on December 17, 2019, Schultes made a withdrawal for which he was charged a $25 OD fee. However, the bank statement issued by Dacotah shows that his account balance never went into the negative numbers and had sufficient funds to cover the withdrawal. The complaint alleges, “It was bad faith and totally outside Mr. Schultes’s reasonable expectations for the credit union to use its discretion to assess … fees for items that did not actually overdraw his account.”

Although the complaint does not specify how the overdraft fee was assessed, other class actions concerning this same topic allege that the bank or other financial institution processed items in a different order than the one shown on the account statement or transacted by the account holder. If the largest items of a day are processed first, then it is possible that transactions that were smaller but completed earlier in the day may be considered to have created an overdraft. Other kinds of processing can create this kind of disputed overdraft as well.

The complaint alleges breach of contract and breach of good faith and fair dealing, among other things.

Article Type: Lawsuit
Topic: Consumer

Most Recent Case Event

Dacotah Bank OD Fees for Accounts Not Overdrawn Complaint

February 21, 2020

Recently many class actions have complained about improper overdraft or non-sufficient funds fees, which add to the profits of banks and credit unions. The complaint for this class action alleges that Dacotah Bank charges customers overdraft or non-sufficient funds fees on items that do not actually overdraw accounts.

Dacotah Bank OD Fees for Accounts Not Overdrawn Complaint

Case Event History

Dacotah Bank OD Fees for Accounts Not Overdrawn Complaint

February 21, 2020

Recently many class actions have complained about improper overdraft or non-sufficient funds fees, which add to the profits of banks and credit unions. The complaint for this class action alleges that Dacotah Bank charges customers overdraft or non-sufficient funds fees on items that do not actually overdraw accounts.

Dacotah Bank OD Fees for Accounts Not Overdrawn Complaint
Tags: Additional charges in breach of contract, Overdraft Fees, Your Bank