Bank Preys on Customers’ Bad Math, Class Says

CHICAGO (CN) - A federal class action claims RBS Citizens bank made millions of dollars by taking advantage of customers' math errors: keeping for itself deposits greater than what was written on deposit slips.

Lead plaintiff Todd Bowers Inc., a chiropractic office, sued RBS Citizens Financial Group, RBS Citizens N.A., and Citizens Bank of Pennsylvania for unfair trade, breach of contract, unjust enrichment and conversion.

Bowers says that in November 2010 it deposited what it believed to be $1,448.57, but "plaintiff erred in its calculation; the actual deposit was $1,475.07. However, Citizens Bank credited plaintiff $1,448.57 and credited account number 9344820186 with $26.50. Account 9344820186 is not plaintiff's account. Citizens Bank retained these funds, diverted same into the aforesaid account."

Bowers adds: "Errors in customer deposits occur daily. Customers depositing currency, coins and checks are required to complete a deposit slip detailing the amount of currency, coins, and individual checks. Customer calculations and tabulations frequently are in error, the customer inaccurately adds the items to be deposited noting a lesser amount to be deposited whereas the actual amount is greater.

"Customer mathematical errors revealing a greater amount being deposited than noted in their deposit slip range from $0.01 up to $50.00 for each deposit. Customers are given confirming deposit slips from Citizens Bank reflecting the amount the customer believed it deposited, which coincides with the customer's deposit slip. Upon information and belief, it is Citizens Bank's policy to discourage branch tellers from adding or calculating the currency, coins and checks to confirm the amount set forth by the customer on their deposit slip.

"Deposits by customers into their Citizens Bank account are retrieved daily from each branch location and delivered to Citizens Bank's Proof Department, which then adds or calculates the actual deposit, crediting the customer account accordingly. Citizens Bank's Proof Department confirms the actual amount deposited based upon the currency, coin and checks submitted. When an error is discovered reflecting that the customer notes a less amount on their deposit slip than actually deposited, the differential is retained by Citizens Bank and diverted to, upon information and belie[f], two (2) different noncustomer accounts maintained and controlled by Citizens Bank. Upon information and belief, the number of deposits into the aforementioned accounts from customer deposit errors (greater amount having been deposited than the deposit slip tendered by Citizens Bank to the customer represents hundreds or thousands of deposits over a yet to be identified period. ...

"However, customers are never informed, advised or otherwise notified by Citizens Bank that their deposit slip contained a mathematical error, the deposit being less than the actual deposit submitted, received and accepted by Citizens Bank. Furthermore, the account statements remitted by Citizens Bank to each of the class members reveals and reflects the erroneous mathematical calculation performed by the customer, the disclosed deposited [sic] being that of what the customer believed and not the actual amount having been deposited and known to Citizens Bank within 24 hours of said deposit..

"Citizens Bank affirmatively masks or hides the actual amount deposited and retains and diverts customer funds into at least two accounts Citizens Banks maintains and control."

The practices is "misleading, deceptive and fraudulent in that Citizens Bank is aware of the customer error, retains the differential and diverts the sum away from the customers account and into an account maintained and controlled by Citizens Bank," the complaint states.

Bowers claims that "Citizens Bank developed a policy and employs a practice whereby customer funds are being diverted daily for the benefit and use by Citizens Bank without the knowledge, consent or approval of the customer. Citizens Bank affirmatively refrains from any notification to the customers of their mathematical error and retains and diverts funds thereby enabling Citizens Bank to amass millions of dollars belonging to customers without accounting for or otherwise explaining the source of the revenue. Customers of Citizens Bank are unaware of their deposit slip errors unless the customer photocopied each supporting deposit and recalculated same subsequent to the deposit. The foregoing virtually never occurs and if it does, the deposit may be off by pennies, leading the customer not to pursue this issue further."

Bowers claims that the bank's "Deposit Agreement attempts to impose an obligation upon customers to verify the accuracy of the information contained in the statement and if no complaint is communicated to Citizens Bank within 30 calendar days after remittance of the statement, Citizens Bank considers the information contained in the account statement to be correct."

Bowers seeks restitution, actual damages, punitive damages and costs.

He is represented by David Thollander.

Subscribe to Closing Arguments

Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.

Email *

Submit