After a two-day trial, a Jersey City jury found that Bank of America violated the New Jersey Consumer Fraud Act when it lost the records of our client’s $26,000 deposit in two separate CDs, and then refused to return her interest and principal when she appeared at the bank several years later with the two original certificates to redeem them.
Our client, a retired grandmother, deposited $26,000 in two CDs (automatically renewable every 7 months) with Bank of America predecessor bank. Several years later, she appeared at Bank of America predecessor bank to redeem her CDs, which had then increased to more than $40,000 in principal and interest. The bank refused to honor her request contending that they could not find any records of her deposits.
A banking law in New Jersey requires that if a customer presents a genuine CD (or a passbook savings account) along with an affidavit that she did not redeem the CD, a bank must pay the customer the value of that CD (principal plus interest) unless the bank finds evidence that payment was already made. Despite having no records of payment on the CD, Bank of America continued to refuse to honor the CDs. Despite our client’s 6-months efforts in trying to obtain her money, the bank refused to honor the CDs. Our client told a bank employee that she will obtain a lawyer, and the bank employee’s response was (in paraphrase) “do what you have to do.”
With prior attorney, suit was then brought against the bank for breach of contract and violation of the New Jersey Consumer Fraud Act, which makes it unlawful for a business to commit an “unconscionable commercial practice” against a consumer.
Bank of America, through their attorneys, first denied all allegations of the plaintiff, even the existence of the CDs. Then a few months later, changed its mind, and admitted that they breached their contract with the plaintiff. But then alleged that the CDs paid interest rates of less than 7% -as low as 1% in some years! Obviously, a judge did not buy that defense. The judge ruled that Bank of America (as a successor in interest) breached its contract with the plaintiff and ordered the Bank to pay the customer the full value of the CDs, which had grown to nearly $45,000.
Plaintiff’s consumer fraud claim remained. The bank then somehow obtained a dismissal of plaintiff’s consumer fraud claim. However, with prior counsel, an appellate court reversed that dismissal finding that a lower court judge was wrong to dismiss the case. The case was then sent for trial and our firm was retained as counsel.
At trial, a former employee was called to testify on behalf of Bank of America. He testified that he received no training from Bank of America when a customer comes in with a passbook savings account or CD and the bank does not have any records of that customer’s deposit. That is, all he can do in such as situation is say to the customer “sorry, we can’t help you.” This is in direct opposite to a New Jersey Banking law (the Record Retention Statute) which states that in such a situation, the bank is required to obtain an affidavit from the customer, and if the bank cannot find proof of payment, the bank MUST pay the customer.
After a 2-day trial, the jury found that Bank of America committed an unconscionable commerical practice in violation of the New Jersey Consumer Fraud Act by refusing to pay the plaintiff on her CDs and requiring her to sue them just to collect her own money.
While the jury did not find that plaintiff suffered an ascertainable loss, a Judge ruled that Bank of America must reimburse plaintiff all her reasonable counsel fees and costs.
The New Jersey Consumer Fraud Act applies to any business transaction. Call us at (201) 222 -0123 for any assistance relating to any fraud, misrepresentation of material omission which causes you to suffer a loss.