“We’re faced with what basically are scam artists, who will go in and remove the labeling from all the ATM machines … and then to go and to try to bring a class-action lawsuit against these financial institutions in very tough economic times,” Rep. David Scott (D-Ga.) said during debate. “It’s a racket that we need to put out of business.”
{mosads}Scott is a leading sponsor of the bill, along with Rep. Blaine Luetkemeyer (R-Mo.), who said there are instances of the suits taking place in his state.
“Someone was traveling throughout the state removing stickers from ATM machines, and then offering to settle with the banks for several thousand dollars per machine, or that bank faced a lawsuit,” Luetkemeyer said.
House Financial Services Committee Chairman Spencer Bachus (R-Ala.) said that while these are frivolous lawsuits, they can often mean significant settlements for the banks involved.
“These lawsuits, they can ask for a half-million dollars’ worth of damage, and because it is actually a statutory failure to have it, these lawsuits sometimes result in a $100,000 or $200,000 judgment,” Bachus said.
Several financial industry groups have pushed for the legislation in order to avoid these suits, and said collectively they have counted hundreds of actions against various banks and credit unions. These groups have said the onscreen prompt that requires people to affirmatively agree to an ATM fee is all customers need, and that getting rid of the requirement of physical signage would help them avoid these legal actions.
House passage of the Amend the Electronic Fund Transfer Act, H.R. 4367, sends it to the Senate, which has not yet said whether or when it might consider the matter.
The House also approved three other non-controversial bills Monday evening:
• H.R. 4155, Veteran Skills to Jobs Act, by a 369-0 vote, and,
• H.R. 5892, Hydropower Regulatory Efficiency Act, by a 372-0 vote.
• S. 2061, the Former Charleston Naval Base Land Exchange Act, providing for an exchange of land between the Department of Homeland Security and the South Carolina State Ports Authority. Agreed voice vote.
— This story was updated at 7:10, and again at 7:21 p.m.