Being charged twice for not having enough money has an almost eerie poetic quality. That is essentially what thousands of Canadians are alleged to have experienced in the CIBC NSF fee class action; years after the lawsuit was initially filed, the bank has now agreed to pay $10 million to resolve the issue.
The Canadian Imperial Bank of Commerce and the Toronto-based legal firm Koskie Minsky LLP, which initiated the class action in September 2022, are parties to the proposed settlement, which was reached on June 24, 2026. A court hearing to approve the settlement is set for October 19. The Ontario Superior Court of Justice certified the case in 2024.
Even though the banking mechanics underlying it are complex, the fundamental accusation is simple. CIBC assessed a $45 non-sufficient funds (NSF) fee when a customer’s pre-authorized debit transaction—such as a utility payment or subscription service—failed due to insufficient funds. Really, standard procedure. This is what banks have always done. However, the lawsuit alleges that CIBC assessed an additional $45 NSF fee for the same unsuccessful payment when the same merchant re-presented the same transaction a day or two later.
A plaintiff in one case mentioned in the class action ultimately had to pay $90 in fees for a single $7.90 charge. Less than a tenth of the penalties they paid was the initial amount owed.
It’s difficult to ignore how well this arrangement worked against those who were already having difficulties. NSF fees “fall disproportionately on low-income Canadians”—those who, by definition, are living on the edge of their account balance—according to the lawsuit itself. A person who carefully manages their money on a daily basis might not even be aware that a merchant has resubmitted a payment that was unsuccessful. They would simply lose an additional forty-five dollars. Then one more.
Customers of CIBC who were assessed these alleged “Second NSF Fees” on pre-authorized debit transactions between September 21, 2020, and May 31, 2024 are covered by the class action. Customers of Simplii, CIBC’s no-fee banking subsidiary, are also covered, albeit with a marginally earlier deadline of December 18, 2022. Koskie Minsky says qualified consumers won’t have to submit a claim. In the event that the settlement is accepted, CIBC will use its own records to identify the impacted accounts and immediately transfer funds to those accounts.
For its part, CIBC has denied any misconduct. The language used in these kinds of settlements is fairly standard: “The bank denies liability.” Courts and consumers alike have become accustomed to overlooking a company’s decision to pay $10 million while maintaining that nothing went wrong. The actual impact on customers was the same regardless of whether CIBC thought it was acting within its contractual rights, which the lawsuit indicates it most likely did.
The precise number of clients who will be eligible and the size of each payout are still unknown. Given that $10 million is spread across a potentially sizable class, some refunds might only total a small amount. However, this is not just a financial matter. Situations such as this one send a message to the larger banking industry. A $10 million settlement, even if it includes a denial of liability, tends to focus attention in boardrooms. In recent years, Canadian banks have come under increasing scrutiny regarding fee structures.
The proposed settlement’s formal approval will be decided at the October court hearing. Affected clients are urged to check Koskie Minsky’s website for updates or keep an eye out for notifications from CIBC until then. Regardless of the payout’s perceived significance, there is something noteworthy about the result: a system that was covertly billing individuals twice for the same error was finally called into question in public.
