Chicago Business Litigation Lawyer Blog

Our Chicago ATM fee fraud attorneys keep an eye on consumer fraud litigation around the U.S. That’s how we discovered a series of lawsuits alleging that various ATM operators around the country committed ATM fee fraud in violation of the Electronic Funds Transfer Act. Pittsburgh law firm Carlson Lynch alleges that ATM operators failed to post a required notice about fees, in at least 12 lawsuits in Pennsylvania, Ohio, New York and Nevada. Most are proposed class actions, which means banks and ATM companies could pay up to $500,000 or one percent of their net work in each suit, if the classes are certified.

The most recent lawsuit to catch our attention was filed Oct. 13 in Rochester, NY. According to an Oct. 23 article from the Rochester Business Journal, ATM customers allege that Canandaigua National Bank & Trust Co. failed to post a notice that a fee would be charge on the outside of the machine, as the EFTA requires. The machines did have a notice provided electronically during the transaction, also a legal requirement. The purported class seeks return of the fees as well as statutory damages of up to $500,000 or one percent. Other cases have been brought against a Las Vegas company that focuses on providing ATMs to casinos and a series of banks and ATM operators in Pennsylvania and Ohio. Attorney Bruce Carlson of Carlson Lynch said his firm has already won at least one settlement of the maximum amount, but at least one of his claims has also been dismissed.

Our Illinois ATM fee fraud lawyers plan to keep a close eye on these cases as they progress. As Carlson told the Business Journal, the relevant language of the EFTA is not ambiguous about ATM operators’ duties. In order to legally charge a fee for using an ATM, the operator of the ATM must post a prominent notice of the fee’s existence and amount “on or at” the machine. It must also provide the notice on the ATM’s screen or on a paper receipt, before the customer completes the transaction and incurs the fee. Most ATM operators have no trouble meeting these requirements, but as these lawsuits demonstrate, a large handful appear to have failed. Consumers who are misled as a result are entitled to hold the ATM operator legally responsible for the extra fees and any other damages the court deems appropriate.

Continue reading "Series of ATM Fee Fraud Lawsuits Allege Banks Failed to Disclose Fees" »

As Chicago ATM fee fraud attorneys, we were extremely interested to see an ATM fee fraud lawsuit filed right here in the Northern District of Illinois. According to an Oct. 29 post from the Chicago Bar-Tender blog, Frederick Brill is suing Marriott International Inc. over alleged violations of the Electronic Funds Transfer Act. The case stems from ATM fees incurred by Brill’s use of an ATM in the lobby of the Marriott Lincolnshire, in the Chicago suburbs, in December of 2008. Brill and his attorneys are seeking class action status for the case, which they say could include hundreds of people.

The complaint in the case says Brill found no notice on the outside of the machine, but he was nonetheless charged a $2.50 fee to use it. This alleged conduct violates the EFTA, a federal law governing consumers’ rights when withdrawing, paying or moving money electronically, including through ATMs. ATM fees are legal under the EFTA, but ATM operators are required to post notices of the fees and their amounts on the outside of the machines. They must also put an additional notice on the screen of the ATM itself, or on a paper receipt, a requirement not at issue in the lawsuit. If ATM operators fail to meet these requirements, the EFTA allows injured consumers to sue to recover the fee, as well as statutory damages of a set amount per violation. If the case is a class action, as proposed here, injured consumers may recover attorney fees and statutory damages of up to $500,000, or one percent of the company’s net worth, whichever is lesser.

As consumer rights attorneys for more than two decades, we are pleased to see growing consumer awareness of this problem. ATM fees themselves caused a lot of grumbling when they were first introduced, but court rulings made it clear that it’s not illegal simply to charge an ATM fee. This has trained many consumers to shrug and accept outrageously high fees. By contrast, the language of the EFTA is very clear about the requirement to give notice of ATM fees on both the outside of the machine and on the screen itself. The law is designed to give consumers the opportunity to opt out of fees they don’t agree with -- something that’s much less likely once they’ve already inserted their cards. Consumers have the right to make decisions about these fees with full information, and ATM operators shouldn’t be able to end-run around their legal obligations, whether out of negligence or deliberate choice.

Continue reading "Illinois Man Sues Marriott for ATM Fee Fraud From Machine at Lincolnshire Hotel" »