BELLEVILLE, Ill. (CN) – National City Bank uses a bait-and-switch tactic to lure in commercial borrowers with a deceptively low “annual” interest rate that’s not based on a full year, a class action claims in St. Clair County Circuit Court.
Lead plaintiff Kreisler & Kreisler says National City entices commercial borrowers by agreeing to charge a certain yearly interest rate, but doesn’t tell them that the rate is based on a calendar year of fewer than 12 months.
As a result, National City charges interest at an actual annual rate of 101.4 percent.
National City also charges borrowers substantial fees to prepare promissory notes and loan documents, the lawsuit states.
The class consists of all entities that have taken out commercial loans since April 1999 with PNC Financial Services, National City Bank’s successor in interest, and had PNC charge them a higher interest rate than agreed to.
The class members seek damages for breach of contract, violations of the Illinois Interest Act, consumer fraud and deceptive business practices.
They are represented by Bernard Ysursa of Belleville, Ill.
PNC is also named as a defendant.