Defending Your Rights
ATM Fee Fraud
The banking business is now nationwide in reach, if not fully global, with large national banks gradually taking the place of smaller, local financial institutions. Banking is also increasingly technological. Where consumers used to have to go to a bank branch and write a check to obtain cash, many now rely on automated teller machines (ATMs). These machines may offer convenience, but they also offer a means for banks to collect fees. These fees are not always reasonable or justified, and consumers may have remedies if a bank overcharges them or fails to disclose ATM fees in advance of a transaction. Our team of Chicago banking fraud lawyers can help identify fraud and advise you of your rights.
Electronic Funds Transfer Act
Congress passed the Electronic Funds Transfer Act (EFTA) in 1978. The law governs a wide range of financial activities, including wire transfers, electronic funds transfers, and ATM transaction fees. The Illinois Electronic Fund Transfer Act (IEFTA), which took effect in 1996, has similar provisions. These laws offer protections for consumers against exorbitant or hidden ATM fees, and they limit consumers’ liability for unauthorized transactions if an ATM card is lost or stolen.
Bank Obligations Under EFTA
Banks may charge a fee for the use of its ATMs by consumers who do not have accounts at that bank. EFTA requires banks that do this to notify consumers of the amount of said fee twice. First, each machine’s exterior must bear a notice that is visible even when the machine in use. Second, the machine must notify the consumer of the amount of the fee during the transaction, and give the consumer the option not to proceed.
With regard to lost or stolen ATM cards, the law limits a consumer’s liability for unauthorized withdrawals or other transactions. The extent of the limitation of liability depends on when the consumer reports the lost card to the institution that issued the card. A bank must limit a consumer’s liability to $50 if the consumer, within two business days of realizing the loss of the card, reports the loss to the bank. If the consumer reports the loss within sixty days of receiving a statement showing an unauthorized transaction, the bank must limit the consumer’s liability to $500. If the consumer does not report the loss after sixty days expire, the consumer could lose all the money in the account.
Consumer Rights Under EFTA
If a bank charges undisclosed or unauthorized fees for an ATM transaction, the consumer may bring suit against the bank to recover the amount of those fees, as well as attorney’s fees between $100 and $1,000. Because the amount of damages for an individual plaintiff may not be large, ATM fee fraud cases often make use of the class action laws to bring numerous consumers with similar complaints together. In a class action for ATM fee fraud, federal law allows plaintiffs to recover the smaller of $500,000 or one percent of the bank’s net worth.
The attorneys at Nationwide Consumer Rights bring decades of experience with ATM fee fraud litigation. We have dedicated our practice to helping consumers around the country who have suffered damages from the fraudulent and unlawful conduct of banks. To schedule a free and confidential consultation with one of our Chicago banking fraud attorneys, please contact us online or at 630-333-0000.
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