BUFFALO, N.Y. (WIVB) — If you have had a checking account at M&T Bank in the last nine years, you might have some money coming your way.
Many of the country’s largest banks figured out a way to boost overdraft charges simply by clearing your checks or debits at the end of the day, in descending order, from largest checks to smallest.
But consumers fought back with class action lawsuits, and the banks are settling, including M&T Bank. The company reached a $4 million settlement, earlier this year, in a federal court in Florida to compensate customers for overdraft charges attorneys claimed were excessive.
The lawsuit alleged M&T Bank would settle transactions at the end of the day, posting the largest debits or checks first. Once the balance in the account was exceeded, even the smallest debits would incur overdraft charges; in some cases the overdraft penalty would be more than than the debit itself.
If the bank posted the smaller items first, only the larger checks would incur an overdraft fee. M&T Bank and other major banks have agreed that is not the way they will post debits going forward.
M&T Bank’s $4 million settlement is being credited to the accounts of affected customers, starting this week. The company has insisted the bank has always conducted its business in accordance with the law, but a spokesman sent a brief email to News 4 saying transactions are now posted as they come in, or they debit the smallest checks first.