TD Bank is facing a lawsuit accusing it of improperly assessing overdraft fees for debit card transactions with ride-hailing services Uber and Lyft.
The suit, filed Tuesday in Camden federal court, was brought by Connecticut resident Britney Lawrence on behalf of national and Connecticut classes of TD Bank debit card holders.
According to the suit, consumers who decline TD Bank’s overdraft protection for debit card transactions exceeding their account balance are advised that any such purchases will be declined, with the exception of recurring expenses such as phone and utility bills. But the bank authorized transactions by those customers using Uber or Lyft, and then charges a $35 overdraft fee.
In Lawrence v. T.D. Bank, N.A., Lawrence was hit with a pair of $35 overdraft fees on March 25, 2016, when she used her TD Bank debit card to pay for two rides that left her account overdrawn, the lawsuit claims.
But TD Bank, based in Cherry Hill, New Jersey, states in its personal deposit account agreement that it will decline nonrecurring debit card transactions that result in a negative balance unless customers opt into its Debit Card Cash Advance Program, the lawsuit claims.
“But as to one very significant type of business, one for which it handles literally millions of transactions each month, TD Bank has decided to accept such transactions, and charge related overdraft fees, even though customers have not opted into Debit Card Advance,” according to the lawsuit.
“When TD Bank customers use their debit card to pay for rides with Uber or Lyft—rides that are by their very nature one-time transactions and non-recurring—TD Bank approves the transactions regardless of the customer’s opt-in status.”
TD Bank spokeswoman Judith Schmidt declined to comment due to the pending litigation.
TD Bank faces claims for breach of contract and violation of the New Jersey Consumer Fraud Act and the Connecticut Unfair Trade Practices Act. The suit seeks restitution of funds obtained as a result of TD Bank’s misconduct, an order requiring it to cease its wrongful conduct, and enjoining it from continuing to conceal its business practices. The suit also seeks a corrective notice campaign.
TD Bank has approximately 1,300 branches in the U.S., and serves 6.5 million customers from Maine through Florida, according to the lawsuit.
The lawsuit was filed by Joseph Sauder and Matthew Schelkopf of McCune Wright Arevalo of Berwyn, Pennsylvania.
Another lawyer for the plaintiffs, Adam Webb of Webb, Klase & Lemond, said similar lawsuits are pending against Bank of America and Wells Fargo. Webb said his firm is also suing TD Bank in a separate class action involving overdraft fees in South Carolina. Webb said he couldn’t estimate the class size in the present case.
The complaint also listed eight other firms representing the plaintiffs—Webb, Klase in Atlanta; Kopelowitz Ostrow Ferguson Weiselberg Gilbert in Fort Lauderdale, Florida; Tycko & Zavareei and Kaliel PLLC, both of Washington, D.C.; The Kick Law Firm and the Law Office of Francis J. Flynn Jr., both in Los Angeles; Sullivan Law & Associates of Bloomington, Indiana; and Consumer Protection Legal of Ellisville, Missouri.
Lawrence and some of her lawyers in the present case have sued TD Bank before, the complaint states, although no details are provided. Lawrence “has proven herself to be active and involved as a class representative in separate action against TD Bank,” and “is passionate about this litigation personally and will prosecute this action vigorously for the benefit of the members of the classes,” the complaint states.