February 12, 2010

Citizens hit with 2 possible class-action lawsuits
By THOMAS GRILLO

GOFFSTOWN - Citizens Financial Group is facing a pair of potential class-action lawsuits alleging that the state’s second largest bank is ripping off customers with illegal overdraft charges and failing to pay its tellers overtime.

Jessica Duval of Goffstown, N.H., argues in a U.S. District Court complaint that she was unfairly charged hundreds of dollars in overdraft fees for purchases made on her ATM card.

“This is an industry practice that we believe is illegal,” said Hassan Zavareei, Duval’s attorney from Tycko & Zavareei in Washington, D.C. “This is a huge source of revenue for lenders totaling $24 billion last year alone. In most cases, there is no cost to the bank and this is just a way to make money from customers.”

The complaint alleges that Citizens Bank manipulates debit transactions to cause overdraft fees even when there are sufficient funds to pay for a purchase.

“If there are three transactions, the bank takes the higher amount first and then the lower amounts, when they could have paid the lower amounts and only charged a fee on one transaction,” Zavareei said. Duval is seeking an injunction preventing Citizens Bank from charging these fees and a refund of hundreds of millions of dollars in unlawful overdraft charges to customers, the complaint said.

A second suit in U.S. District Court alleges that Citizens failed to pay overtime to Kevin Martin and others by erasing overtime from timecards or requiring compensatory time instead of pay.

Michael Jones, a Citizens Bank spokesman, said: “We have just received the complaints and are reviewing them and have no further comment at this time.” 

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