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LegalGems
LegalGems, Lawyer
Category: Consumer Protection Law
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I have a business account with a Debit/Credit card attached

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I have a business account with a Debit/Credit card attached to it. After the account went into overdraft there was a first overdraft fee of $26. That I understand. Afterwards there were 11 accidental but authorized charges (basically, an user charging to this account was not notified to temporarily stop charging).
The bank allowed the transaction but charged $26 per transaction as a penalty. The bank claims that the authorized charges though the account was overdrawn could not be stopped and are not refundable. Are there any consumer protection laws concerning this?

LegalGems :

Hi! LegalGems here. I have extensive consumer law experience and will use this to assist you with your issue today. One moment as I look into this for you; I don't believe I've had a similar question posed before.

Customer:

Basically the bank allowed charges without funds so they could charge an overdraft fee 11 times. Is that legal?

LegalGems :

That's what I'm checking on. I believe it comes down to the bank's policy but I am verifying.

LegalGems :

I'm going to link you to the federal reserve page on this. Basically, if you did not opt in to this type of charge, then they would not be able to continue to charge overdraft fees. But if you did opt in, you will see from the example given that they may continue to charge overdraft fees, even if their was no money in the account due to a prior overdraft. http://www.federalreserve.gov/consumerinfo/wyntk_overdraft.htm

LegalGems :

However, since the bank doesn't lose any money per se in overdraft fee reversals, they are generally quite generous in voluntarily reversing such charges, especially if it is uncharacteristic and they value the customer. So you may want to talk to the branch manager or the teller that you typically deal with.

Customer:

Thank you so much

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