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How Banks' Slight-of-hands Cause Overdrafts
 
     NOTICE: Cobble and Chase Bank confidentially settled this matter out of court on Jan. 5, 2011.

     This Nov. 5, '09 claim filed against Chase Bank (Jefferson County, Kentucky) explains how the banks are scamming to cause overdrafts in their customers' checking / debit-card accounts. Banks are not entering and "subtracting" their customer's purchases as "pending" on the same day of purchase (as otherwise required), so that you cannot know (verify) your actual available balance. When numerous purchases are made within a short period, it causes the account to "cascade" into multiple overdrafts.


The Overdraft Problem at a Glance
Cobble's Transaction Sheet shows how Chase Bank and others use deceptive accounting practices to induce overdrafts.
 JURISDICTION

1.         Comes Plaintiff Daniel Cobble to file this COMPLAINT against Defendant J.P. Morgan Chase Bank, N.A. (Chase Bank). This court has jurisdiction, because this matter regards deceptive banking transactions within Jefferson County, Kentucky between Cobble and Chase Bank; both are domiciled in Kentucky. Since Cobble seeks compensatory damages under $4000.00, this court has jurisdiction as matters of equity and law. -- Cobble demands a trial by jury.

2.         Cobble well understands today’s climate of the Courts routinely denying the valid claims of average Americans when they are violated \ injured by governmental officials and corporate officers. Here, Cobble requests of the Court to allow Cobble’s right to due process of law and equity under Article III, § 2 of the U.S. Constitution, as well as Kentucky’s Constitution.

3.         The public is aware of the overdraft scams of banks that are being suffered by many consumers. Cobble was recently scammed at Chase Bank, as this Complaint explains how banks are exploiting consumers for unwarranted overdraft fees, yet another predatory practice.   
      
                           

COMPLAINT

4.         On October 28, ’09, Cobble filed a letter-of-complaint by verifiable mail with Chase Bank of which Cobble is an account holder, Checking Account #696180561. However, Chase Bank has not responded to that complaint which has prompted the instant Complaint.

4A.          Chase Bank alleges that Cobble is overdrawn in his account by $256.00, with a total of eight overdrafts. On or about Nov. 1, ’09, Chase deducted $256.00 from Cobble’s checking account without responding to the 10-28-09 complaint, supra.

4B.         Cobble has been managing his accounts at Chase Bank since 1997 (i.e., including prior to Chase Bank’s acquisition of BankOne) and has never had this problem. Cobble is experienced at managing his accounts. – Therefore, it can be shown how Chase Bank is conducting improper accounting practices that caused Cobble to become overdrawn.

5.         For starters, the online activities record (activities record) for checking accounts are the only running official bank record available to customers for verifying balances and pending purchases. Thus, the record of pending balances should be current by reflecting the dates of purchases, as has always been with Cobble’s accounts. But this time, Cobble was prevented from verifying his actual balance, because Chase Bank withheld posting the pending purchases of Cobble’s “dates of purchase” until the day the money was actually taken from Cobble’s account, on Oct. 13, ’09. This caused a cascade of the eight overdrafts.

5A.         In other words, Chase Bank avoided posting Cobble’s transactions as “pending” on the days of purchasing. These transactions were not entered into Cobble’s “online activities record” until they were actually paid by the bank, and thus leaving Cobble with a misleading record of his activities as he checked his balance from day-to-day.

5B.         But to the contrary, banks are required to subtract and list transactions as pending at the time / point of purchases.                                                                

6.         Historically, when tracking his transactions, whenever Cobble would make a purchase and go home or to an ATM that same day to check his balance, those transactions would be posted as “pending” in his activities record, subtracted from his balance (as pending balance) on the same dates of purchase. – In the bank’s activities record, if the date the purchase is the same as the paid date (deducted from the account), then there are no actual “pending items.” This practice is misleading to customers, as they cannot accurately verify their balances against the activities record when purchases are not listed and subtracted at the time of purchases.

         To wit,

6A.         Cobble’s  $15.74 Zone Ave. BP purchase occurred on 10-9-09, but was never entered as actually pending or subtracted from the available balance for that day, but was improperly entered on 10-13-09 and paid by Chase Bank on 10-13-09.

6B.         Cobble’s $14.82 Kroger purchase occurred on 10-10-09, but was never entered as actually pending or subtracted from the available balance for that day, but was improperly entered on 10-13-09 and paid by Chase Bank on 10-13-09.

6C.         Cobble’s $16.92 AppleOnline purchase occurred on 10-10-09, but was never entered as actually pending or subtracted from the available balance for that day, , but was improperly entered on 10-13-09 and paid by Chase Bank on 10-13-09.

6D.         Cobble’s $37.66 Viet Hoa Food purchase occurred on 10-11-09, but was never entered as actually pending or subtracted from the available balance for that day, but was improperly entered on 10-13-09 and paid by Chase Bank on 10-13-09.

6E.         Cobble’s $27.63 Aldi #39 purchase occurred on 10-11-09, but was never entered as actually pending or subtracted from the available balance for that day, but was improperly entered on 10-13-09 and paid by Chase Bank on 10-13-09. 

                                                                                         

7.         See ATTACHMENT #1 (2 pages) as Cobble’s transaction history that verifies the foregoing transactions. They were deceptively listed as purchases by Chase Bank only when they were paid on Oct. 13; Not when Cobble made these many purchases. Please observe that the $15.74 Zone Ave. BP purchase was held for four days before being subtracted from the balance.

8.         Once again, there are no actual pending transactions if they are listed on the days of payment by the bank. Like Cobble, this deception can only confuse customers and cause undue overdrafts. Chase Bank is preventing people from verifying their actual available balances to cause overdrafts. As stated, prior to this experience, Cobble has always known for his purchases to post as pending on the same day of his purchases and subtracted from his account balance, as he has virtually a clean record with his account history.

8A.          Without being able to reflect the true balance from Cobble’s activities record, the overdrafts “cascaded” to eight until Cobble started receiving overdraft notices from Chase Bank.

 

 COUNT I

9.          On 10-9-09, Chase Bank committed a deceptive business practice when it did not subtract Cobble’s $15.74 Zone Ave. BP purchase from the account balance until 10-13-09 to cause an overdraft in Cobble’s checking account.

COUNT II

10.          On 10-10-09, Chase Bank committed a deceptive business practice when it did not subtract Cobble’s $14.82 Kroger purchase from the account balance until 10-13-09 to cause an overdraft in Cobble’s checking account.

COUNT III

11.          On 10-10-09, Chase Bank committed a deceptive business practice when it did not subtract Cobble’s $16.92 AppleOnline purchase from the account balance until 10-13-09 to cause an overdraft in Cobble’s checking account.

COUNT IV

12. On 10-11-09, Chase Bank committed a deceptive business practice when it did not subtract Cobble’s $37.66 Viet Hoa Food purchase from the account balance until 10-13-09 to cause an overdraft in Cobble’s checking account.

COUNT V

13.          On 10-11-09, Chase Bank committed a deceptive business practice when it did not subtract Cobble’s $27.63 Aldi #39 purchase from the account balance until 10-13-09 to cause an overdraft in Cobble’s checking account.        

COUNT VI

14.          On 10-11-09, Chase Bank committed a deceptive business practice when it did not subtract Cobble’s $6.13 Subzi Mandi purchase from the account balance until 10-13-09 to cause an overdraft in Cobble’s checking account. 

15.          Relief Sought:

         A.          Require Chase Bank to subtract customer purchases from account balances and list as pending at the time of purchasing;

         B.         Chase Bank to restore Cobble’s account to its original balance prior to its 10-9-09 deceptive practice, supra;

         C.         Chase Bank to refund to Cobble’s account the overdraft fees that were taken (for eight overdrafts);

         D.         Chase Bank to compensate Cobble at $1200.00 for the disruption and inconvenience of these multiple deceptive practices.

         This Complaint respectfully submitted,

                   Daniel Cobble   Date: Nov. 6, '09
                  3401 Lesway Ct., #12 - Louisville, KY 40220

Attachment: Cobble's Oct. 26, '09 Transaction History from Chase Bank

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Address of Defendant:

       J.P. Morgan Chase Bank, N.A. 
c/o Eric R. Ostrander, Branch Manager
       2943 Richland Ave.
       Louisville, KY 40220