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Can I sue if my bank won’t release my money?

It depends on the reason. But as consumer protection lawyers, we run into a common situation where banks flag your account for potential fraud for some reason and freeze it—but then when you try to prove who you are, they run you in circles. 

If your bank has frozen your money and won’t let you prove your identity in a reasonable time, we may be able to help. Our firm helps consumers get access to their bank accounts using state consumer protection laws and a federal statute called EFTA (the Electronic Funds Transfer Act). If your bank is giving you the run-around for no good reason, call us at 657-845-3100. We represent consumers in most cases we take on contingency, meaning we only charge a fee from the money we win. We don’t charge for consultations and don’t charge anything to do an evaluation of your case.

Bank accounts can get flagged for fraud for lots of reasons. Suspicious logins, or weird transactions, or even just that you had trouble running your card and doubled up buying something. Maybe your identity got stolen. Maybe someone tried to hack your account. Maybe you just lost your wallet or lost your debit card. If a bank thinks your account might be at risk for fraud or someone stealing your money, they’re allowed to flag the account and take reasonable steps to protect your money.

BUT – they can’t just lock you out forever. If you tell them to give you your money back and they won’t, EFTA may let you sue. The statute awards the consumer between $100 and $1,000 as a penalty for a violation. We can also use state laws—for example, in Georgia the Fair Business Practices Act protects consumers from unfair practices. Holding your money and not giving it back when you ask isn’t exactly fair. In California, the Unfair Competition Law also lets you sue to stop unfair business practices. And in Texas, the Deceptive Trade Practices Act does the same. Most states have similar laws. 

The situation we often see is that banks have outsourced all their customer service, or even want to do it using automated phone systems. Trying to get a real person on the line is like pulling teeth. And when you do, they send you around in circles to other departments. You could send in proof that you’re the owner of the account, and then still be waiting for weeks to get to use your money again. We’ve seen people waiting months, even though they’ve proven who they were, and the bank still won’t give them their money. They’re caught in their own red tape and often they just don’t care.

That’s a huge deal for regular consumers. How are you supposed to pay your bills if your bank won’t let you use your money? This could ruin your credit, cause lots of stress, and even lead to repossessions or the power getting shut off. 

If you’ve sent your bank proof of your identity and proof that you’re on the bank account, and they’re refusing to let you access your account anyway for long periods of time, you may have a claim. 

Can I file a lawsuit against my bank?

You may have to do something called arbitration instead. Almost every company in the country now forces their customers to go to arbitration and not to court. It’s buried down in the contract somewhere you’d never look – but courts have upheld it anyway. But that’s not the end of the world. Our law firm is experienced in filing arbitrations against financial institutions who mistreat their customers. And an arbitration is basically a “mini-lawsuit.” There’s a long rulebook and the lawyers present your case to an arbitrator, not a judge. 

Most banks we see have some kind of arbitration clause. But our firm has handled lots of arbitrations, and our lawyers know how to win. Studies show that consumers rarely win their case without a lawyer. But when you have a “repeat player” like Kneupper & Covey – a firm that arbitrates cases again and again – your odds of winning go up dramatically. 

If your bank is taking weeks or months to let you back into your account, even though you’ve given them the information they need, you may or may not have a legal claim, but we don’t charge to evaluate your case and we take most cases on a contingent fee basis, which means we only charge a fee if we take your case and we recover money. Call Kneupper & Covey today at 657-845-3100, or e-mail us at contact@kneuppercovey.com. We’ll help figure out if you have a valid legal claim, and if so, where to file it.

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