$2.8M South Central Bank Settlement Resolves Class Action Lawsuit Over Retry, Overdraft Fees

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South Central Bank has agreed to a $2,800,000 settlement to conclude a class action lawsuit that alleged the financial institution charged accountholders improper overdraft fees on transactions authorized on sufficient funds, and on repeated attempts to process the same transaction.

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The $2.8 million South Central Bank class action settlement received preliminary approval from the court on March 13, 2026. The settlement covers all individuals who were charged one or more of the following “challenged fees” by South Central Bank:

• Overdraft fees assessed by the bank between October 4, 2009 and October 8, 2018 after a signature-based debit card transaction that was authorized on sufficient funds but settled in the authorized amount (authorized positive, settled negative, or ASPN, fees); and
• Overdraft or non-sufficient funds fees assessed by the bank between October 4, 2009 and December 31, 2025 on repeated attempts to process a transaction that had been initially denied for insufficient funds (retry fees).

Court documents state that consumers who received a settlement notice by mail are automatically covered by the class action settlement.

The court-approved website for the South Central Bank overdraft fee settlement can be found at JohnsonOverdraftClassAction.com.

South Central Bank settlement class members do not need to take any action to receive a pro rata cash payment from the deal.

The amount of each class member’s payout will depend on the amount of applicable challenged fees paid by the individual during the relevant period.

Court documents note that class members who are current accountholders with the South Central Bank will receive their settlement payout as a credit to their open account, whereas former accountholders will receive their payout via check.

The court will determine whether to grant final approval to the South Central Bank settlement following a hearing on July 7, 2026. Compensation will begin to be distributed to class members only after final approval is granted and any appeals are resolved.

The South Central Bank class action lawsuit alleged that the Kentucky-based financial services provider wrongfully charged accountholders overdraft fees on debit card transactions, including ASPN and retry fees, in violation of the Kentucky Consumer Protection Act.

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