Bloomberg News

PNC Bank Will Pay $90 Million to Resolve Overdraft Lawsuit

June 26, 2012

PNC Bank Will Pay $90 Million to Resolve Overdraft Lawsuit

A PNC Bank in Philadelphia. Photographer: Matt Rourke/AP Photo

PNC Bank, a unit of PNC Financial Services Group Inc. (PNC:US), will pay $90 million to settle a lawsuit accusing it of improperly manipulating customers’ debit card transactions to generate excess overdraft fees, lawyers said.

The lawsuit, part of litigation involving more than 30 banks, is pending before U.S. District Judge James Lawrence King in Miami, lawyers for the plaintiffs said in an e-mailed statement today.

The customers claimed PNC Bank’s computer system resequenced the actual order of debit card and ATM transactions by posting them in highest-to-lowest dollar amount instead of the actual order in which they were initiated, according to the statement. That led to excess overdraft fees, the plaintiffs say.

Other banks have reached settlements. Toronto-Dominion Bank (TD), Canada’s second-largest bank, entered in May a preliminary agreement to pay $62 million to settle overdraft claims. In April Citizens Bank agreed to pay $137.5 million. In February JPMorgan Chase & Co. (JPM:US), the biggest U.S. bank by assets, reached an agreement for $110 million.

Robert Gilbert, a lawyer for customers, said in the statement that the settlement will be presented to King for preliminary approval later this summer.

Fred Solomon, a spokesman for Pittsburgh-based PNC, declined to comment on the case.

The case is In re Checking Account Overdraft Litigation, 09-md-02036, U.S. District Court, Southern District of Florida (Miami).

To contact the reporter on this story: Joel Rosenblatt in San Francisco at jrosenblatt@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net


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Companies Mentioned

  • PNC
    (PNC Financial Services Group Inc/The)
    • $84.58 USD
    • 0.01
    • 0.01%
  • JPM
    (JPMorgan Chase & Co)
    • $58.99 USD
    • -0.18
    • -0.31%
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