February 6, 2012
JPMorgan Chase settles overdraft fee case for $110 million
JPMorgan Chase & Co has agreed to pay $110 million to settle consumer litigation accusing it of charging excessive overdraft fees.
The largest U.S. bank by assets joined Bank of America Corp and several smaller lenders in settling their portion of the nationwide litigation over the fees, which are typically assessed when customers overdraw their checking accounts. Consumers had accused more than 30 lenders of routinely processing transactions from largest to smallest rather than in chronological order.
This can cause overdraft fees, typically $25 to $35, to pile up because account balances fall faster when larger transactions are processed first. Critics say this disproportionately burdens customers with lower incomes and balances. JPMorgan's settlement in principle was disclosed in a filing on Friday with the U.S. district court in Miami.