First Citizens Bank Sued Over Allegedly Unauthorized ‘Sham’ Account Openings

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First Citizens Bank of South Carolina has been hit with a proposed class action lawsuit in which two plaintiffs allege the bank opened unauthorized credit accounts in their names. The “sham accounts,” according to the suit, resulted in damage to the plaintiffs’ credit and jeopardized their mortgage loan.

The plaintiffs say they visited the defendant’s Forest Drive branch in April 2018 to open a joint checking account and request a mortgage loan pre-qualification letter. According to the complaint, the plaintiffs were also offered an overdraft credit line, credit card accounts, and investment services, all of which they declined. The individuals claim, however, that they received letters from the defendant later that month regarding an apparent newly opened line of credit and a credit card in each of their names.

The suit goes on to explain that the plaintiffs, after returning to the bank to dispute and close the accounts, were assured multiple times by the defendant’s representatives that the accounts were indeed unauthorized and would not be reported to credit bureaus. The case also claims the bank promised to send letters acknowledging the mistake yet never did so.

In August 2018, the suit continues, one of the plaintiffs was contacted by his mortgage broker, who questioned the man about “multiple First Citizens credit accounts” that supposedly appeared on his credit report within the past year. The plaintiff says he checked the report and discovered that the defendant had inaccurately noted that the accounts were “closed by consumer.” Upon contacting the bank and demanding that the accounts be reported as unauthorized and deleted, the plaintiff claims the defendant promised yet again to send the aforementioned letters acknowledging that the accounts were unauthorized. When the letters finally came, the suit alleges, First Citizens had “omitted that the accounts were unauthorized entirely.”

“To date,” the complaint reads, “(while acknowledging verbally that the accounts were unauthorized) Defendant has failed and refused to put same in writing or, apparently, to address the larger issue of its Sham Account openings.”

Originally filed in state court, the lawsuit has recently been removed to federal court in South Carolina.