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ESSA Bank & Trust negotiates settlement of repossession lawsuit

Stroudsburg, Pa.-based ESSA Bank & Trust has reached a tentative settlement with the plaintiff in a September 2016 lawsuit over repossessed motor vehicles.

The lawsuit claimed that the ESSA Bancorp Inc. subsidiary had sold the repossessed vehicles and tried to collect deficiency balances in a way that did not comply with Pennsylvania code.

The parties are now negotiating an accord that will resolve the claims on a class-wide basis. The bank may pay $1.3 million as part of the deal, with its insurance carrier covering the amount in excess of a $125,000 retention.

Any settlement reached will still be subject to court approval.