TD Bank customers in Maine and around the country saw the shiny “Penny Arcade” coin counting machines unplugged, covered up and eventually carried away from the lobbies of their local branches last summer.

In recent weeks, they’ve received cards in the mail hinting at why: a notice that they were eligible members of a class action settlement against the bank over the Penny Arcades, which had allegedly been shortchanging customers for years.

The problem with the festive machines was first uncovered by NBC television’s “Today” show, which in April 2016 tested machines at five New York City TD Bank branches and found all of them were undercounting, some by a penny or two on the dollar, one by 15 percent. “Today” also tested rival Coinstar machines and found those to be completely accurate.

Before the segment even aired, the Toronto-based bank – whose U.S. subsidiary is headquartered in New Jersey – announced it was pulling all Penny Arcades from service to be evaluated. They never returned to operation.

That’s in part because of a class action lawsuit filed shortly thereafter at a federal court in New Jersey by attorney Stephen DeNittis, who already had notoriety for his role as co-lead counsel in a class action suit against Subway alleging its footlong subs were shorter than advertised. The settlement he helped negotiate with Subway was thrown out by a federal appeals court on Aug. 25 after the judge deemed it was “no better than a racket” because it benefited only the plaintiff’s attorneys, who would have collected $525,000.

The Penny Arcade settlement, however, has proved enduring and awards $7.5 million to people who used the machines between April 11, 2010, and July 12, 2017. The attorneys received $1.9 million and plaintiffs named in the suit $65,000.


TD Bank’s New Jersey-based spokesman, Matthew Doherty, declined to discuss the settlement or what went wrong with the Penny Arcades. “We don’t comment on litigation,” he said by email.

DeNittis did not respond to interview requests.

The class action payments will be made automatically to those who were TD Bank account holders at the time, but non-customers who used the Penny Arcades have to submit a claim form online (at by Oct. 27.

Most claimants will receive a refund of 0.26 percent of their Penny Arcade transactions during the period, likely a dollar or less for a casual user or a child cashing out a piggy bank.

The original suit alleged TD Bank’s machines “continuously undercounted coins placed in them by consumers for years and resulted in the loss of millions of dollars for consumers.”

TD Bank subsequently tested more than 1,000 Penny Arcades twice and found net undercounts of between 0.117 percent and 0.090 percent, according to court documents.

TD purchased Portland-based Banknorth in 2008, and it began introducing the Penny Arcades throughout Maine. The counting machines were free for bank customers, but an 8 percent fee was levied on non-customers.


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