Associated Bank in Green Bay, Wis., has agreed to pay $13 million to exit a class-action lawsuit that accuses it and other issuers of processing debit card transactions in a manner that maximized fees from overdrafts.
The $21.6 billion-asset unit of Associated Banc-Corp said in a Securities and Exchange Commission filing Nov. 29 that the settlement will free it from all claims related to the multidistrict suit filed in the U.S. District Court for the Southern District of Florida.
Initially filed in Wisconsin federal court in 2010, the suit accused Associated of intentionally manipulating the order in which it processed debit transactions in a way that triggered more overdrafts and, in turn, more profits. The suit later was consolidated into a class action involving some roughly 30 banks (
Associated is at least the fourth bank to reach a settlement in the case. In October, Union Bank in San Francisco and Iberiabank Corp. in Lafayette, La., agreed to pay $35 million and $2.5 million, respectively, to exit the class action (
According to a Nov. 28 Bloomberg report, BOK Financial Corp. agreed to pay $19 million to resolve an accountholder’s state-court lawsuit over the overdraft policy of its Bank of Oklahoma unit. And earlier this year, Bank of America Corp. agreed to pay roughly $400 million to settle claims against it.
Associated said in an SEC filing that it already had set aside funds relating to the lawsuit and that the $13 million settlement would not have a material impact on its year-end financial results.
Associated's shares were trading at $9.84 late Nov. 29, down about 1% from the previous day’s close.
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