TCF Bank Accused Of 'Tricking' Consumers Into Costly Overdraft Services
MINNEAPOLIS (WCCO) -- A federal financial protection agency is suing TCF Bank, accusing the Wayzata-based bank of tricking customers into costly overdraft services.
According to the Consumer Financial Protection Bureau, TCF Bank purposefully designed its application process to obscure the fees and make overdraft seem mandatory for new customers attempting to open a new account.
The CFPB also says TCF Bank adopted a loose definition of consent for existing customers to opt them into the service – while pushing back on any customer who questioned the process.
"Today we are suing TCF for tricking consumers into costly overdraft services in order to preserve its bottom line," CFPB Director Richard Cordray said. "TCF bulldozed its way through protections against automatic overdraft enrollment and then celebrated its unusual sign-up success. With today's action, we are standing up for consumers' right to understand and choose what services they receive."
CFPB says relied on overdraft fee revenue to "a greater degree than most other banks its size and recognized early on that the opt-in rule could negatively impact its business."
The lawsuit claims the bank's strategy worked so well the bank's chief financial officer, William Cooper, even named his boat "Overdraft."
The lawsuit seeks redress for consumers, injunction to prevent future violations and a civil money penalty.
