If an item is submitted for payment a second time, does it become a second item? Or is it still the same item? The complaint for this class action alleges that Trustco Bank improperly charges multiple $36 fees on a single item and that this practices violates its account agreements.
The class for this action is all account holders at Trustco Bank who were charged multiple fees on a single item by Trustco Bank during the statute of limitations.
Overdraft (OD) and non-sufficient funds (NSF) fees generate a great deal of income for banks these days. The complaint claims, “According to a banking industry market research company, Moebs Services, in 2018 alone, banks generated an estimated $34.5 billion from overdraft fees.” Unfortunately, the complaint alleges, these fees are often charged to those who are least able to pay them—those who are younger, lower-income, and non-white.
The complaint alleges, “Trustco unlawfully maximizes its already profitable fees through its deceptive and contractually-prohibited practice of charging multiple NSF fees, or an NSF fee followed by an overdraft fee, on an item.”
Plaintiff Thomas Jenkins has a checking account with Trustco, which is governed by the bank’s Trustco Bank Retail Online Banking, Bill Paying and Mobile Banking Agreement, and Electronic Fund Transfers Disclosure Agreement, which the complaint refers to as “the Contract.”
When a check, electronic payment item, or ACH item is presented for payment to an account for a customer like Jenkins, if the account does not have sufficient funds, the bank has two options: Trustco may (1) pay the item and charge an OD fee, or (2) reject the items and charge an NSF fee. Either of these fees will cost the account holder $36.
The complaint says, “The Contract promises that, at most, “a fee” (singular) may be assessed on “an item” (singular). But if the item is not paid when it is first presented, the complaint alleges that Trustco improperly charges another fee if it is presented again and the account still does not have sufficient funds to pay it.
According to the complaint, this practice amounts to charging a second fee on the same item. The complaint alleges, “The same ‘item’ on an account cannot conceivably become a new one each time it is rejected for payment then reprocessed, especially when—as here—Plaintiff [Jenkins] took no action to resubmit it.”
“There is zero indication anywhere in the Contract that the same ‘item’ is eligible to incur multiple fees[,]” the complaint contends.
As an example here, Jenkins attempted to make a one-time payment on December 5, 2018. Trustco rejected the item because Jenkins’s account did not have sufficient funds and charged him a $36 fee for doing so. On or around December 11, without Jenkins’s knowledge or any request form him, Trustco again tried to process the payment. However, the account still did not contain sufficient funds to pay the item, so Trustco charged Jenkins another $36 fee.
Article Type: LawsuitTopic: Consumer
Most Recent Case Event
Trustco Bank Charging Multiple Fees on a Single Item Complaint
March 1, 2021
If an item is submitted for payment a second time, does it become a second item? Or is it still the same item? The complaint for this class action alleges that Trustco Bank improperly charges multiple $36 fees on a single item and that this practices violates its account agreements.
Trustco Bank Charging Multiple Fees on a Single Item ComplaintCase Event History
Trustco Bank Charging Multiple Fees on a Single Item Complaint
March 1, 2021
If an item is submitted for payment a second time, does it become a second item? Or is it still the same item? The complaint for this class action alleges that Trustco Bank improperly charges multiple $36 fees on a single item and that this practices violates its account agreements.
Trustco Bank Charging Multiple Fees on a Single Item Complaint