Zions Bank sued over 'unconscionable' fees

SALT LAKE CITY (AP) - A customer who says Zions Bank makes it difficult - if not impossible - to avoid overdraft fees has filed a lawsuit in federal court, making the Utah bank one of dozens whose extra charges have triggered lawsuits from angry consumers.

The lawsuit, which seeks class-action status, was filed this week by three law firms on behalf of Melinda Barlow, of Sandy, and other customers who were charged overdraft fees under policies that were in place between 2005 and 2010.

It comes more than a year after federal regulators slapped limits on bank overdraft practices and the resulting fees.

U.S. banks reportedly raked in nearly $40 billion a year from the charges before regulations took effect in July 2010 requiring banks to get customers' permission to enroll them in overdraft programs and limiting how many fees could be charged in one day.

Court papers say Zions' policies allowed it to manipulate and alter the order in which debit transactions were posted so it could maximize the number of overdrafts, increasing the fees collected from customers.