A California federal judge ordered Wells Fargo to change what he called “unfair and deceptive business practices” that led customers into paying multiple overdraft fees, and to pay $203 million back to customers.
Wells Fargo adopted the policies beginning in 2001, and they became widespread across the banking industry. It is unclear how the ruling would apply to the rest of the industry.
The ruling detailed the experiences of two Wells Fargo customers who used their debit cards for multiple small purchases, and were then charged hundreds in overdraft fees because the order the purchases were cleared by the bank depended on the amounts. The judge found the customers, who were part of a class action, were not properly informed of the bank’s policies on processing payments and were unaware the bank would allow debit purchases to go through when their accounts were overdrawn.