News

Lawsuits filed against bank-owned ATMs that do not display surcharge-fee sticker

April 24, 2011

A retired couple is driving throughout Michigan and filing federal lawsuits against banks if their ATMs do not post notices on the machines, alerting non-bank customers about surcharge fees, according to the Detroit Free Press newspaper.

The couple, Nancy Kinder and Ray Harrison, has filed the lawsuits in Michigan federal courts, alleging that banks are violating the Electronic Fund Transfer Act, which Congress passed in 1978 to establish consumer rights and liabilities. The legislation requires banks to display surcharge fees on ATM screens and on the machines' cabinets.

They have sued 36 banks, and last week Independent Bank of Ionia, Mich., settled a lawsuit for $350,000 involving more than 40 ATMs deployed throughout the state. Each member of the class-action lawsuit is entitled to $1,000, according to the Detroit Free Press. Court records also show that JPMorgan Chase & Co., operator of the nation's second-largest ATM network, settled a similar lawsuit in 2009 in Wisconsin for $2.1 million.

The article noted that filing federal lawsuits against banks when their ATMs do not display surcharge-fee stickers has given birth to a nationwide cottage industry. Consumers have filed lawsuits in California, Texas and Illinois as well as Michigan.

Although the banking industry views the lawsuits as frivolous, the plaintiffs' lawyers say lawsuits are necessary to ensure banks follow the law.