Beaumont, TX: Compass Bank, the country's 15th largest bank, is facing a class action lawsuit over allegations that it illegally charges excessive termination fees to discourage its customers from transferring their assets.
The lawsuit, filed by George W. Brown III, in Jefferson County, claims that when Brown tried to transfer his money from Compass Bank to Genesis, Compass said they would charge him a termination fee of no more than 1 percent -- fees that would result in charges in excess of the $25 asset termination fee Compass promised Brown when he invested with the bank, according to the complaint.
"Compass ultimately charged Plaintiff and the Class members a termination fee in an amount equal to 34 basis points of their account balances, which violated the Hibernia trust department fee schedule as well as the industry standard, and resulted in a termination fee substantially in excess of a $25 per asset termination fee, or the flat fee industry, which is unreasonable for the industry and is unconscionable," the suit states.
In his suit, Brown alleges breach of contract, breach of fiduciary duty, breach of the duty of good faith and fair dealing, conversion, violations of the Texas Theft Liability Act and Violations of the Texas Deceptive Trade Practices-Consumer Protection Act against Compass. In addition, he alleges unjust enrichment.
