Consumers will receive $7.9 million from a recent class action settlement with Equifax Check Services, a company that collects dishonored checks.

A major class action lawsuit alleged Equifax charged consumers $20 "bad check fees" that were not authorized by law. The case, which lasted more than seven years, resulted in a $7.9 million settlement that compensated thousands of consumers for illegitimate fees charged by the check processing company.

Debt collectors often take advantage of consumers by levying unauthorized charges, said O. Randolph Bragg, a consumer class action attorney with Horwitz, Horwitz & Associates of Chicago, who handled the case. Corporations may rely on the fact that individual consumers are unaware of the illegal charges and often cannot afford to attain legal help, Bragg said.

"Equifax Check Services fought tooth and nail trying to prove it was okay to bilk millions of dollars from hundreds of thousands of consumers," Bragg said. "But the legal system and the Fair Debt Collection Practices Act worked in favor of consumers. I'm glad I could help bring this problem to light."

The plaintiff filed suit under the Fair Debt Practices Act, or FDCPA, a federal law that protects consumers from debt collection companies. The FDCPA sets limits on what tactics debt collectors can use and establishes procedures to consumers from illegal debt collection practices.

Equifax alleged the $20 "bad check fees" were legitimate and allowed by the Uniform Commercial Code, or UCC. However, the court held that California law did not allow the fees.

Class action lawsuits enable an individual consumer to represent the interests of many people in the same situation. Without class action lawsuits, it would be often be impractical for consumers to protect themselves. For instance, it would not be feasible for a single consumer to hire an attorney to sue over a $20 charge.

Bragg said consumers who feel they are being ripped-off by debt collectors or financial transaction companies should contact an attorney who specializes in that area. If filing a lawsuit is not feasible, consumers can take other steps. For instance, consumers can contact the Federal Trade Commission, their state's Attorney General or the Consumer Protection Division of their local District Attorney's Office.