Many Consumerism Commentary readers have written in to let me know that they recently received a check for about $98 from Bank of America. If you received this check prior to November 2012, this check is not a result of the Bank of America overdraft fee class action lawsuit, but it is the result of a similar lawsuit. First of all, the overdraft lawsuit has only recently entered an appeal process. It could be another year or more before customers see any benefits from this latest class action.
Banking Deal: Earn 1.20% APY on an FDIC-insured savings account at Barclays.
The check is the benefit that customers are receiving due to an earlier class action lawsuit, Closson v. Bank of America. Customers who are eligible had a Bank of America, Fleet Bank, LaSalle Bank or U.S. Trust Company debit card and paid an insufficient funds fee, overdraft fee or similar fee before December 31, 2007. In order to receive a benefit, customers would have needed to file a claim form before May 1, 2009. The deadline to receive any benefits has long since passed, so even if you fit this description, it is too late to become a member of this lawsuit.
This is one of many class action lawsuits against Bank of America, some of which pertain to companies that were purchased by the bank, like Countrywide Financial.
Checks received after November 2, 2012 and before November 30, 2012 are proceeds from the highly-publicized overdraft fee class-action lawsuit. Continuing customers will receive their portion of the settlement in the form of a credit on their checking account statements, but other customers will be receiving a check in the mail to the last address known to the bank.
Here is a list of all current and recent Bank of America class-action lawsuits.
- Ross, et al. v. Bank of America, et al. This lawsuit pertains to the bank’s forcing of customers into mandatory binding arbitration, much like Wells Fargo is doing today. This is a new class action lawsuit.
- Closson v. Bank of America. This is the class action lawsuit I described above. Bank of America encouraged its customers to use debit cards that were designed to increase the number of fees. If you received a check in or around December 2011, and if the amount is $98, it is likely a result of this lawsuit.
- Bank of America overdraft lawsuit. Over 1,000 Consumerism Commentary readers have offered their thoughts about Bank of America’s processing of customers’ debits in a certain order that ensured that they could maximize fee revenue from overdrafts. Read more here. Affected customers are receiving their proceeds in November 2012.
- Homeowner lawsuits. Class action lawsuits in several states, including California and Washington, allege that Bank of America or its related companies withheld taxpayer money designed to help homeowners facing foreclosure.
- Foreign currency conversions. Bank of America was one of many defendants (also including Visa, MasterCard, Chase, Citibank, and more) in a class action lawsuit regarding a conspiracy to set fees for foreign currency conversions, eliminating competition in this particular aspect of business.
Class action lawsuits are usually settled by the defendants, often without admitting any wrongdoing. As a result of settlement, affected customers often only receive a small award while the lawyers representing the class receive significant payments for their work and time. For example, in the overdraft fee settlement, lawyers will receive $123 million, or 30% of the settlement fund, unless the verdict is successfully appealed. At the same time, each affected customer will only receive a portion of the overdraft fees paid. That could be $35 or less per individual.
Are you included in a Bank of America class action lawsuit? Have you received a check in the mail from Bank of America without knowing why?
Updated September 24, 2015 and originally published December 26, 2011.