CHARLESTON -- A West Virginia resident who claims City National Bank of Charleston assessed him hundreds of dollars of overdraft fees has filed a lawsuit against the bank.
City National Bank charged Thomas Casto and other City National customers in West Virginia, overdraft fees on their checking accounts because of the bank's "unfair and deceptive overdraft fee practices," according a complaint filed June 17 in Kanawha Circuit Court.
Casto claims the bank's practices violate West Virginia's consumer protection law and City National's contracts with its customers.
"Many of these overdraft fees were charged only because City National manipulated the way debit card transactions were posted," said John Barrett, a partner at Bailey & Glasser, which represents Casto. "In addition, the bank never properly disclosed its overdraft policies to its customers."
Bailey & Glasser is teaming with the with Washington, D.C.-based law firm of Tycko & Zavareei in the lawsuit against City National.
"This is yet another example of bank misconduct directed at hardworking customers at a time when thousands of West Virginia residents and millions more Americans are struggling to make ends meet," said West Virginia native Hassan Zavareei, of Tycko & Zavareei.
National banks charge an estimated $27 billion annually in overdraft fees, according to the suit.
Casto claims City National engages in a systematic policy of re-ordering debit card transactions from highest dollar amount to lowest dollar amount so as to deplete the customer's available funds as quickly as possible while maximizing the number of overdraft fees; charges overdraft fees even in situations where in fact a customer has not overdrawn his checking account; charges overdraft fees even in situations where City National in fact did not pay out more funds than were in the customer's checking account; and fails to provide accurate account balance information on the bank's website or at the point of sale.
Bailey & Glasser and Tycko & Zavareei are also investigating the overdraft fee practices of other banks in West Virginia.
"We are continuing to investigate City National and other banks," Barrett said. "Customers should be compensated for the unfair bank practices that caused these improperly charged fees."
Casto, a South Charleston resident, claims from May 14, 2006, until June 14, 2006, he was charged 21 overdraft fees, which totaled to $651. He claims the overdraft fees were charged solely because the bank considered Casto to have an insufficient account balance made entirely of overdraft fees charged in the previous month.
Casto is seeking injunctive relief enjoining City National from charging overdraft fees; damages in an amount to be determined at trial; disgorgement and restitution of all overdraft fees paid to City National; statutory penalties; and pre- and post-judgment interest.
The case has been assigned to Circuit Judge Jennifer Bailey.
Kanawha Circuit Court case number: 10-C-1089