Azernews.Az

By Bloomberg

An HSBC Holdings Plc unit agreed to pay $30 million to U.S. banking customers who claimed they were charged excessive overdraft fees because debit account transactions were manipulated by the bank, lawyers said in a court filing.

The lawsuit settlement, if approved by a judge, will cover all U.S. customers who were hit with the fees from December 2004 to July 2010, lawyers for the plaintiffs said in papers filed Monday in state court in Manhattan.

The bank, accused of generating fees by manipulating the posting of the transactions in consumer accounts, ceased the practice in individual accounts in 2010 and business accounts in 2011, the lawyers said. The settlement also covers business customers, according to the filing.

The settlement is an “excellent result” for customers and represents about half of what they might recover if they won at a trial, the lawyers said.

Customers alleged the HSBC unit manipulated overdraft fees by processing larger transactions before smaller ones and charging a $35 fee for each purchase made when funds in the account were insufficient.

Banks including Bank of America Corp., Toronto Dominion Bank and JPMorgan Chase & Co. previously reached settlements over similar claims of excessive overdraft charges.

HSBC Bank USA, a U.S. unit of the London-based banking firm, has branches in 10 states and Washington. Rob Sherman, a spokesman for HSBC, declined to comment on the settlement.

The case is Levin v. HSBC Bank USA NA, 650562/2011, New York State Supreme Court (Manhattan).