Bank of America (BOA) has agreed to pay US$410 million to settle a federal lawsuit alleging the bank charged excessive overdraft fees.
The suit is one of several filed against several banks from plaintiffs in 14 US states, which were consolidated in a federal court in Florida. Other banks named in related suits include Wells Fargo and Citibank.
The US’ largest bank said in a court filing on Friday that it has reached a memorandum of understanding to settle the claims in the suit by paying US$410 million. The settlement is subject to court approval.
Consumers alleged the bank processed the payments in a way that caused more overdrafts.
Customers pay overdraft fees when they spend more money than remains in their accounts. The fees can reach US$35 apiece. Before US federal law changed this summer, banks frequently charged overdraft fees on numerous transactions in a single day.
Anne Pace, a spokeswoman for the Charlotte, North Carolina, bank, said on Saturday that it is “pleased to reach a fair resolution” to the case. BOA has already has addressed many related customer concerns, she said.
Wells Fargo is appealing a US$203 million judgment in a separate California case.