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Banks are oftentimes an intimidating place that we try to avoid and only visit when we absolutely have to, so if we feel like a bank has wronged us it might be scary to think about going after them to get our money back. Although it seems impossible to fight back against an institution as powerful as a bank, there are several federal agencies that will fight for you and give you the ability to empower yourself to take action.
Reasons you might want to sue or file a complaint against a bank
There are many possible reasons to sue or file a complaint against a bank, below are some of the most common:
The bank is violating consumer protection law
The bank is making unfair or misleading statements
The bank is conducting unauthorized signups
The bank is negligent
How to File a Complaint Against a Bank
There are several federal and state agencies where you can file a complaint against a bank.
What is the Federal Reserve Consumer help?
If you have a complaint about a major bank or any financial institution, then it's possible that a Federal Reserve Consumer complaint may be your best choice. This is because the Federal Reserve is a federal regulatory agency that has the authority over many consumer protection laws that banks have to follow. If the Federal Reserve finds that there is an agency that can better serve you, they will transfer the complaint to them to help you and other consumers.
What is the Federal Reserve Consumer help process?
When you are ready to file a complaint with the Federal Reserve, you can go to the Federal Reserve Consumer help website to begin the process.
Once you have filed your complaint and it has been received, you will be informed about which regulator has been assigned your complaint within 15 days in an acknowledgement letter. If your complaint is delegated to a different federal regulator, then you should contact them for more information about their timeline, as the following will only apply to a complaint accepted by the Federal Reserve.
Contact the Reserve Bank assigned to your complaint in the acknowledgement letter for information and status updates
Within 60 days of receiving your complaint, you will be notified of the results of the investigation
What is the Consumer Financial Protection Bureau?
The Consumer Financial Protection Bureau is a U.S. government agency that sets and enforces rules that ensure that banks, lenders, and other financial companies are properly treating their consumers.
What is the Consumer Financial Protection Bureau complaint process like?
To begin your complaint process with the CFPB, go to this website and select start a new complaint.
Once your complaint is submitted, you will receive a confirmation email with an updated status tracker
The complaint will be sent to the institution to respond or to an agency better capable of helping you
Generally within 15 days, the institution will respond to your complaint or alert you that it has been recognized and will be answered soon
The complaint will be published by the CFPB without any identifying information about you
Once the institution responds to your complaint, you will have 60 days to review and provide feedback about how the response satisfies your issue.
How to file a complaint with your State Attorney General
The attorney general in your state is responsible for taking complaints from residents of their state for a wide range of reasons. If anything, your AG can be a great starting point to figure out who you should contact and who can help you further. If you search your state’s AG and file a complaint with them, they may choose to investigate it, delegate it to another federal agency, or allow you to make a public complaint to warn others in your area of this institution’s malpractices.
How to Sue a Bank
While many banks have clauses in their contracts and terms of service that force consumers into closed door arbitration, many times there is an exception to file in small claims court instead of arbitration.
How to file a lawsuit against a bank
Suing a bank or financial institution in small claims may seem overwhelming and impossible, that is why we have attempted to simplify the process and outline it as best we can. The general steps to the small claims lawsuit is outlined below:
Prepare and file the lawsuit
Serve (properly notify) the financial institution you are suing
Prepare for and attend the small claims hearing
Preparing and filing the lawsuit
You want to make sure you're suing the right bank
Oftentimes a bank will be operating under a name other than their legal entity name, this is called a fictitious business name, so the first step should always be to make sure the company you are suing is the correct legal name.
If you sue the wrong bank there are many issues that can arise, your suit could be thrown out, or your winnings could be against the wrong company which will likely result in many problems.
Find the Registered Agent for Service
Knowing the correct bank name, you can search for that business’ registered agent for service. This agent is the person who the company has selected to be the person who legal documents are delivered to.
Make sure you create a checklist of all potential evidence
For all lawsuits, it's crucial that you properly prepare the documents that you might think are beneficial to your argument and case.
Here is an example checklist of evidence for a small claims lawsuit against a bank:
Bank Statements (make sure to cross off any confidential information).
Letters or Emails to the bank
Screenshots of your account
What to expect from your hearing
Small claims hearings are typically informal and most hearings do not last long. While many disputes in small claims court settle before the hearing, it’s important to be prepared to go to court and make your claim heard.
In small claims court, generally parties will choose to go to court without any legal representation. In fact, in some states a lawyer is not even allowed to represent you. So make sure to get informed about your local small claims court procedures and rules before your court date.
Chief Legal Architect & Co-Founder @ People Clerk. Camila holds a law degree and is a certified mediator. Her passion is breaking down complicated legal processes so that people without an attorney can get justice.