Dayton Business Journal…
Fifth Third reaches $10M settlement in class-action
Wednesday, December 1, 2010, 1:47pm EST
Fifth Third Bancorp has reached a nearly $10 million settlement in a class-action lawsuit against it regarding overdraft fees it charged its customers.
The settlement in the U.S. District Court for the Northern District of Illinois addresses the issue of Fifth Third (Nasdaq: FITB) failing to post customers’ debit card transactions in chronological order. Fifth Third’s means of posting those transactions from largest to smallest within the course of a day at times led to overdraft fees.
The class-action case applies to customers between Oct. 21, 2004, and July 1, 2010. Customers who incurred at least one overdraft fee related to at least one debit card transaction qualify.
If the settlement is approved, Fifth Third will pay $9.5 million into a settlement fund, according to court documents. Customers can receive up to three times their claim, depending on the amount of claims made, the document said.
Fifth Third issued a statement in response to the settlement.
“While we admit no wrongdoing, we felt that it was in the best interest of the company to settle this matter and move forward,” it said in the statement.
“There have been a lot of positive changes in the industry related to overdraft fees and we remain committed to providing services and tools to help our customers manage and monitor their account balances. Additionally, we have agreed to post debit card and ATM transactions in chronological order – i.e., on the date of presentment for payment, Fifth Third debit card transactions will be posted in the order they took place, regardless of amount. The posting procedure change is targeted to occur in early 2011.”
The court will hold a hearing March 16 to determine whether to give final approval of the settlement. Customers have until May 2 to submit claims for benefits.
Fifth Third in Dayton has 84 branches, 875 employees and about $4.3 billion in regional deposits.