WASHINGTON –The banking industry, facing a rash of lawsuits over fee-disclosure signs on ATMs, is hoping for help this week both from Congress and the Supreme Court.
On Capitol Hill, the House Financial Services Committee is scheduled to vote Wednesday on a bipartisan bill that would eliminate the requirement that ATMs display signs disclosing their fees, in light of the fact that ATM users must separately receive an on-screen notice of any charges.
The goal is to stop nuisance lawsuits. Rep. Blaine Luetkemeyer, R-Mo., said that in his home state, one man visited five ATMs, threatened to sue over missing fee-disclosure stickers, and settled the cases for more than $100,000.
“And apparently it’s been going on throughout the country,” said Luetkemeyer, who is sponsoring the House legislation. “Everybody realizes this is a situation that’s got to be fixed.”
The day after the House panel votes, the Supreme Court is expected to issue a ruling that observers said has the potential to make the legislative remedy unnecessary.
The Supreme Court case, which involves alleged violations of the Real Estate Settlement Practices Act, hinges on whether the plaintiff can sue based solely on the fact that the law was violated, regardless of whether the plaintiff suffered any harm as a result.
That parallels the situation with the Electronic Fund Transfer Act, the federal law that plaintiffs have been using to sue over missing ATM fee signs. Because the plaintiffs all agreed to pay the $2 or $3 fee – using on-screen prompts – they cannot argue that they suffered any harm from the missing signs, industry supporters said.
So the Supreme Court ruling, which will be far overshadowed Thursday by the decision on health-care reform, could go a long way toward ameliorating bank industry worries about the recent spike in ATM sign lawsuits.
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