A class action lawsuit has accused a company that operates more than 40 currency exchange outlets in the Chicago area of improperly taking fees onto checks that have been refused because the writers of the checks asked their banks to stop payment for security reasons.
On Jan. 8, attorney Daniel A. Edelman and others with the firm of Edelman Combs Latturner & Goodwin, of Chicago, filed suit in Cook County Circuit Court against Chicago-based Barr Management Ltd.
Daniel Edelman
| Edelman Combs Latturner & Goodwin
According to the complaint, Barr operates a chain of currency exchange stores throughout the Chicago area, including a store known as the Belmont-Central Currency Exchange in the 5500 block of West Belmont Avenue, Chicago.
According to the complaint, in October, Kraj left a signed personal check in the amount of $950, with contractors who had performed work on his property.
Kraj, however, did not write the name of the person or company receiving payment on the check.
The check was allegedly picked up and ultimately signed by someone who worked for those contractors. That person then allegedly wrote their own name on the check, and cashed it at the Belmont-Central Currency Exchange. That person allegedly kept the money and did not pay the contractors as Kraj desired.
Kraj allegedly then placed a stop payment order on the check with his bank.
In late November, Kraj allegedly received a notice from the currency exchange, demanding payment of the $950, plus an additional $25. That was followed in late December by a letter from the currency exchange’s attorney, describing the additional $25 as a “return check fee.”
The December letter allegedly acknowledged the payment had been stopped “as a result of a stop payment order issued because of ‘contractual disputes’” with the man who had cashed the check.
According to the complaint, Barr and its currency exchanges are not authorized to charge such a fee under state law. Rather, Kraj’s complaint asserts the law only allows such fees if a check cannot be honored because the check is fraudulent, or because the person writing the check doesn’t have sufficient funds in the account to satisfy the check.
A check not honored because of a stop payment order does not fit the criteria for return check fees under state law, the complaint said.
The complaint seeks to expand the action to include a class of additional plaintiffs, including anyone who was charged such a return check fee by a Barr-owned currency exchange under similar circumstances in the past 10 years.
The complaint does not estimate how many people this might include.
Kraj’s complaint asserts Barr’s alleged practices violate the Illinois Consumer Fraud Act.
The complaint seeks unspecified compensatory and punitive damages, plus attorney fees.