Waterbury, CN: Waterbury-based Webster Bank has agreed to pay nearly $3 million to settle a class action lawsuit, which alleged that the bank manipulated customers' account debits in a way that maximizes
overdraft fees
Webster said it agreed to the payment to "fully and finally resolve the litigation," which was filed in Superior Court in Waterbury in April, "and avoid any further expense and distraction."
In the suit, Kelly Mathena, a Webster Bank customer from Middlebury, alleged that the bank routinely posts checks and ATM withdrawals against customers' accounts so they generate overdraft fees, even when accounts have a positive balance.
Mathena said Webster does this by re-ordering debit transactions from the highest dollar amounts to the lowest, to drain the accounts as quickly as possible and maximize fees.
She said in her suit that Webster could stop debits from going through when the account balance drops below a certain threshold, or at least warn customers they lack sufficient funds to cover the debits.
Her suit said the scheme was "extremely profitable'' for Webster and other U.S. banks, citing federal banking data that lenders rack up more than $27 billion in overdraft fees annually.
Despite the $2.8 million settlement, Webster Bank said it "continues to believe its practices were both proper and lawful."
The settlement will also resolve a similar class action currently pending in New York.
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I never received notification of this settlement; found out about it online prior to settlement date. I put our names onto this class action settlement suit to be included in Plaintiff action and settlement distribution against Webster. (husband and I were in prior lawsuit for same, approx. 2010; I recv'd notification and compensation, husband recv'd nothing - 2 different accounts - ??). I discovered this case settled April 2016 when I again checked online. **I e-mailed Plaintiff's representation and litigation info without hearing anything back. In the meantime, Webster has continuously been doing the same illegal, multiple fraudulent banking practices to its consumers without ANY help no matter what we say and present! - How were we not included in this 2016 litigation suit, esp. after writing before and after? Anything to be done at this point?
Posted by Maureen Hennessey
on
I have received notices from time to time notifying me of what was going on, but since this has settled I have heard nothing at all. What is going on and what do I have to do to receive what is due to me. I am severe financial straights and this kind of thing doesn't help. Please notify me ASAP. Thank you.
Maureen P. Hennessey
Posted by J Martin
on
OMG! THIS BANK SHOULDN'T BE ALLOWED TO DO BUSINESS IN OUR STATE AND THE FEDS SHOULD CLOSE THEM DOWN!! RACKETEERING IS WHAT THEY ARE DOING!! THEY CREATE PROBLEMS JUST TO TAKE YOUR MONEY! THEY ARE MANIPULATING YOUR CREDIT AND DEBIT CHARGES BY HAND TO CREATE A NEGATIVE IN YOUR ACCOUNT WHEN CLEARLY IF THE CHARGES WENT THROUGH NATURALLY BY THE ORDER YOU MAKE THEM (WITHOUT WEBSTER FOOLING AROUND WITH THE SYSTEM( THEY WOULD CLEAR YOUR ACCOUNT NO PROBLEM WITHOUT ANY FEES! I WAS CHARGE 7 NSF at $37.00 a pop (so they took $259.00 out of my account) WHEN MY ACCOUNT WAS NEVER EVER IN THE NEGATIVE!!! THEY ARE CLAIMING THEY CAN HOLD MONEY BEHIND THE SCENES EVEN THOUGH IT DOESNT SHOW ANYThING ONLINE WHEN I CHECK MY ACCOUNT! THEY CLAIM IF YOU USE YOUR WEBSTER CARD TO PUT A HOLD ON SOMETHING THEY CAN "HOLD" YOUR MONEY BEHIND THE SCENES EVEN THOUGH YOUR CARD IS NEVER ACTUALLY PROCESSED- SO IF YOU CALL TO PUT A HOLD ON A HOTEL ROOM BUT PLAN TO PAY CASH, WEBSTER IS SAYING THEY CAN HOLD THAT MONEY EVEN THOUGH IT DOESNT SHOW UP IN YOUR ACCOUNT> SO THEY ARE CLAIMING SINCE I HAD A HOLD ON SOMETHING (AGAIN THIS HOLD WASNT PROCESSED BY THE OTHER COMPANY) THAT THEY ARE LEGALLY ABLE TO HOLD MY MONEY FOR THAT CHARGE BEHIND THE SCENE WITHOUT SAYING ONE WORD TO ME OR SHOWING IT ON MY ACCOUNT- SO THEYRE SAYING ALL MY OTHER DEBIT TRANSACTIONS BOUNCED! HOWEVER MY ACCOUNT NEVER SHOWED THEY WERE HOLDING THIS MONEY AND I WAS NEVER IN THE NEGATIVE THE ENTIRE MONTH! ARE YOU KIDDING ME??? SO NOW WEBSTER IS BIG BROTHER WATCHING EVERYTHING YOU DO- PLUS HOW IS IT LEGAL FOR THEM TO HOLD YOUR MONDY "BEHIND THE SCENE" AND NOT TELL YOU OR SHOW YOU A HOLD ON YOUR ACCOUNT?? I HAD TO FIGHT TOOTH AND NAIL WITH THEM TO REVERSE THESE CHARGES. THIS IS CLEARLY FRAUDULENT AND I HAVE NO IDEA HOW THESE BANKS ARE GETTING AWAY WITH THIS! THEY WERE SUPPOSE TO CREDIT MY MONEY BACK INTO MY ACCOUNT> I JUST CHECKED AND THEY ONLY CREDITED HALF OF THE FEES SO THEY STILL OWE ME OVER A HUNDRED DOLLARS! THEY ARE STEALING MY MONEY! WEBSTER IS THE WORSE BANK EVER- THEY ARE SCAMMERS AND THEIFS AND ANYONE WHO USES THEM SHOULD THINK TWICE! DO YOURSELF A FAVOR,- GO BANK SOMEWHERE ELSE! THIS BANK DOESNT DESERVE ANYONE'S BUSINESS!
Posted by Helen Rohne
on
I received a post card about 4 years ago telling me about the suit. I got another card the end of this past June. It did not say anything about a claim form. It just said if I did not do anything my part of the settlement would either be deposited in my account or a check would be mailed to me. What is going on with this suit?
Posted by Susie D.
on
I had to leave Webster Bank a couple years ago because of this!! I had rental properties and would deposit the checks.. it would show online that they were cleared...I would use my debit card and get overdrafts. I would go back on line and it would show the checks were not cleared...of course not until the end of that day...after I used my debit card and they took all that out first, before showing the check cleared! I was in that bank almost weekly arguing with them. I started printing what the online balance was showing in the mornings, as when I went into the bank later in the day, it was showing something else. Sad thing is that I had that account for 27 yrs! From First Federal, to Eagle Federal and then Webster. They were the WORST THEIVES!! Now I'm with Farmington Bank and they have been great. Never had this problem again!!!
Posted by Ian Dietz
on
I was charged so many overdraft fees by Webster's bank, what can I do to sue?
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