Walmart Bounced into Changing Check Payment Policy after $1.85B Class Action Lawsuit

Check-paying Walmart (WMT) shoppers stand to benefit from a $1.85 million class action settlement, which will change the retail giant’s checkout policies.

Fees for Bounced Checks

According to the lawsuit, Walmart allegedly failed to let its customers know that they might be charged multiple bank fees for bounced checks at the checkout.

According to the settlement, Walmart did not inform customers that its check verification company, TeleCheck, might make multiple attempts at cashing checks that bounce, and, if successful, might also make multiple attempts to recover “return fees” from shoppers’ bank accounts.

The initial plaintiff in the case claimed that they were hit by multiple bank fees as a result of Walmart and TeleCheck attempting to recover their check and the return fee.

What Does the Settlement Involve?

Although Walmart has not admitted any wrongdoing, it has agreed to the settlement to avoid further court action. Under the terms of the deal, Walmart will change its check-processing disclosures at the point of sale at all of its U.S. stores. The Walmart settlement provides non-monetary benefits to all customers who wrote a check for payment of goods or services at any Walmart retail store in the United States.

The settlement includes all past, present and future customers who wrote a check as a form of payment at a Walmart checkout.

• Walmart will update its posted check policy and PIN pad disclosures at every Walmart store in the United States.
• The new disclosures will clearly state that if a bank returns a check as unpaid, Walmart and its check processor, TeleCheck, may make multiple attempts to collect both the check amount and any return fees. The disclosures will also state that each attempt could result in separate bank fees from the customer’s bank.

The deadline to object to the terms of the settlement is April 23, and the final approval hearing is May 13.

Is WMT a Good Stock to Buy Now?

On TipRanks, WMT has a Strong Buy consensus based on 27 Buy and 2 Hold ratings. Its highest price target is $150. WMT stock’s consensus price target is $138.92, implying a 12.63% upside.