New York Community Bank $1.23M Fee Class Action Settlement

New York Community Bank checking account holders whom the bank charged certain nonsufficient funds or overdraft fees on check or automated clearing house payments between March 2, 2017, and Jan. 1, 2020, or multiple out-of-network ATM fees on withdrawals preceded by a balance inquiry between Aug. 20, 2020, and Feb. 20, 2024, may be eligible to receive a cash payment or account credit from a class action settlement.

New York Community Bank, now known as Flagstar Bank, agreed to pay $1,233,500 to settle a class action lawsuit alleging it improperly charged customers certain nonsufficient funds, overdraft and out-of-network ATM fees in violation of account agreements and New York law.

Who are the class members?

The class includes individuals and entities who had a checking account with New York Community Bank and whom the bank assessed specific fees during the relevant periods. This includes those whom the bank charged:

• A nonsufficient funds fee or overdraft fee on a check or ACH payment that a merchant resubmitted after it returned for insufficient funds between March 2, 2017, and Jan. 1, 2020
• Multiple out-of-network ATM fees on ATM withdrawals preceded by a balance inquiry between Aug. 20, 2020, and Feb. 20, 2024

The settlement covers both current and former accountholders. The settlement administrator used the bank’s records to identify eligible class members. Those who received a notice are likely included in the class.

How much is the New York Community Bank payout?

The total settlement fund is $1,233,500. After deducting attorneys’ fees, litigation costs, incentive awards for class representatives and the settlement administrator’s expenses, the settlement administrator will distribute the remaining funds to eligible class members. The exact amount each person receives will depend on the amount of eligible fees New York Community Bank charged them and the total number of class members.

If there are uncashed checks after the first distribution, the settlement administrator may distribute remaining funds to class members who cashed their checks or received account credits as long as it is practical. If not, the administrator will donate the fund to Community Service Society of New York’s Financial Coaching Corps Program, per court approval.

No claim form needed to receive payment

Class members do not need to file a claim to receive payment. The settlement administrator will issue payments or credits automatically to eligible class members. There is no online or paper claim form to submit.

Class members whose address has changed or who need to update their information should contact the settlement administrator as soon as possible.

Settlement administrator's contact information: US Realty Group LLC et al v. New York Community Bank, c/o Settlement Administrator, P.O. Box 25226 Santa Ana, CA 92799, info@NYCBsettlement.com, 833-417-4937

Payout options

• Current accountholders will receive a credit directly to their New York Community Bank account.
• Former accountholders will receive a check mailed to their last known address.

$1.23 million settlement fund breakdown

The $1,233,500 settlement fund includes:

• Settlement administration costs: $64,439 (estimated)
• Attorneys' fees: Up to $411,166.70
• Attorneys' expenses: $8,085.97 (estimated)
• Service awards to class representatives: Up to $15,000 each (up to $30,000 total)
• Payments to eligible class members: $719,807.33 (estimated)

Important dates

• Opt-out deadline: Dec. 15, 2025
• Final approval hearing: Jan. 13, 2026

When is the New York Community Bank settlement payout date?

The settlement administrator will issue payments or credits to eligible claimants approximately 40 days after the court grants final approval to the settlement and resolves any appeals.

Why did this class action settlement happen?

The class action lawsuit alleged New York Community Bank improperly charged customers certain nonsufficient funds, overdraft and out-of-network ATM fees. The plaintiffs alleged these fees violated the bank’s account agreements and New York law.

The bank denies any wrongdoing but agreed to settle to avoid the costs and risks of continued litigation. Both sides agreed that settlement was in the best interest of all parties given the uncertainties and potential delays of a trial.

Sources

1. Class notice
2. Settlement agreement
3. Settlement FAQ