Friday, December 21, 2012

Law Will Protect Banks and Credit Unions from Frivolous Lawsuits

President Obama signed into law on December 20 a bill (HR 4367) that would protect banks and credit unions from frivolous lawsuits by repealing an outdated, duplicative requirement that a placard must be attached to ATMs stating that a fee may be charged.

If the placard was not attached to an ATM, a consumer may recover statutory damages of between $100 and $1,000 for each transaction. Successful class-action plaintiffs could recover up to $500,000. As a result, a cottage industry developed where some people were removing placards, photographing ATMs without them and filing lawsuits.

However, the placard requirement is unnecessary because ATM operators are required to disclose fees on ATM screens and consumers have the right to decline the transaction without being charged.
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