Flagstar Financial, formerly known as New York Community Bank (NYCB) until 2024, has faced accusations of charging unfair ATM and non-sufficient funds (NSF) fees. The New York-based bank has agreed to settle the claims for $1.23 million, though it has not admitted to any wrongdoing.
Plaintiffs have said that these charges were unfair and violated the bank’s policies with customers. This settlement benefits those who have or had a checking account with Flagstar Financial between March 2, 2017, and Jan. 1, 2020, when it would have been known as New York Community Bank.
These claimants must have been charged retry fees for having non-sufficient funds, and or overdraft fees on check or automated clearing house (ACH) payments. ACH payments refer to electronic transfers between US bank accounts.
The settlement also pays out to those who have or had a checking account with the bank and were charged more than one out-of-network (OON) ATM fee on ATM withdrawals. This has to have happened between August, 20, 2020 and February, 20, 2024.
The settlement specifies that this charge needs to have been preceded by a balance inquiry on the ATM. This is similar to the option that allows you to check your balance, which then allows you to print a receipt that states the balance in your account.
How to GET PAID
Under the terms of the settlement, plaintiffs can earn compensation for the fees they were said were overcharged.
Class members who were charged retry fees for NSF, and or overdraft fees on check or ACH payments will receive a proportional share of the settlement fund. This amount will be based on the amount they were charged in the relevant fees.
Those who were charged OON ATM fees on ATM withdrawals preceded by a balance inquiry can receive $25 as a one-time payment. Claimants who still hold their account with the bank will receive their payments as an account credit.
What’s a class-action settlement?
Class action lawsuits offer groups of people, or classes, a way to band together in court. These suits are often brought by one or a few people who allege a company or other entity has wronged a large group of people.
When a suit becomes a class action, it extends to all “class members,” or people who may have similar complaints to those who filed the suit.
Companies often settle class actions – offering payment to class members who typically waive their right to pursue further legal action by accepting money.
These payout agreements frequently include statements by the defendant denying wrongdoing. Companies tend to settle class actions to avoid the costs of further litigation.
Pollution, discrimination, or false advertising are a few examples of what can land a class action on a company’s doorstep. Former account holders will be sent a check.
There is no proof of purchase required to apply to the settlement, making it easier for you to get paid.
DEADLINE for Payment
There is no claim form to fill out, instead, those who do not opt out of the settlement will automatically get paid.
The deadline to opt out is December 15, for those who believe themselves to be in the class pool but do not want to be given payment.
Every settlement gives claimants a chance to opt out if they were automatically made eligible for payment.
Payments will then go out sometime after the final approval hearing, which is scheduled for January 13, 2026.
FAQ
What is a class-action settlement?
A class-action lawsuit is a legal case brought by a group of people, known as “class members,” who have similar complaints against a company or entity. In many cases, companies settle these lawsuits by offering payments to the class members, who typically waive their right to pursue further legal action. Companies settle to avoid the costs of prolonged litigation.
Do I need proof of purchase to apply for the settlement?
No, there is no proof of purchase required to apply for the settlement, making it easier for eligible individuals to receive compensation.
How do I claim my settlement?
There is no claim form to fill out. Those who are eligible for the settlement will automatically receive payment unless they choose to opt out. Payments will be issued after the final approval hearing, which is scheduled for January 13, 2026.
What if I don’t want to be part of the settlement?
If you believe you are eligible for the settlement but do not wish to receive payment, you have the option to opt out. The deadline to opt out is December 15, 2025.
When will I receive my payment?
Payments will be issued after the final approval hearing, which is scheduled for January 13, 2026. Claimants who still have an account with Flagstar Financial will receive an account credit, while former account holders will receive a check
