Skip to main content

Excessive Fee Lawsuits in Credit Union Land


Lakeland, FL — Credit unions are increasingly coming under fire for excessive overdraft fees, in the same way that major banks have been taken to task for misdeeds such as reorganizing transactions to maximize fees. In October plaintiff Martha Towner filed a Credit Union Excessive Overdraft Fees lawsuit alleging 1st MidAmerica Credit Union charged overdraft fees improperly.

But that’s just the tip of the iceberg, according to various media reports. Since September, at least a dozen credit unions have been hit with class-action Excessive Overdraft Fees lawsuits in nine states, with various pundits weighing in with the observation that this could be the tip of the iceberg.

Towner, in her class-action lawsuit (Towner et al v. MidAmerica Credit Union, and Does 1-100, case No. 3:15-cv-01162, filed October 20, 2015 in US District Court, Southern District of Illinois), claims that her credit union charged her overdraft fees on various transactions, even though there were sufficient funds in her checking account to cover those transactions.

Tracy Fry is another plaintiff who takes exception to the practices of credit unions. Fry asserts in her Credit Union Lawsuit filed in November that MidFlorida Credit Union based in Lakeland charged overdraft fees based on members’ available balances, rather than actual balances. Not only does Fry assert that such methodology is improper, but also constitutes a breach of MidFlorida’s opt-in agreement and was not consistent with disclosures issued to members.

 MidFlorida, it should be noted, serves 220,000 members and boasts $2.3 billion in assets.
 Plaintiffs assert that credit unions with such assets do not need to be nickel-and-diming their members in such fashion. Pundits and industry watchers, meanwhile, say that what we’re seeing is just the tip of an iceberg that will soon reveal itself.

Numerous Credit Union Excessive Overdraft Fees Lawsuits have alleged that credit unions altered the sequence of transactions to maximize fees. While in some cases this has yet to be proven, other lawsuits - such as those of Fry and Towner noted above - accuse the credit unions of misleading practices while basing fees on available balances, rather than actual balances. Industry watchers assert that such lawsuits are not necessarily alleging the credit union is doing anything blatantly improper, but rather is accusing the credit union of misleading conduct.

Attorneys representing the interests of credit unions are urging such organizations to review their disclosures to ensure everything is buttoned-down, thus avoiding any fee, debit or other activity that might be viewed as misleading.


Plaintiffs, on the other hand, aren’t waiting for credit unions to get their respective houses in order. If they have been misled or wronged with unnecessary fees, the credit union is going to hear about it through the plaintiff’s Excessive Overdraft Fees Lawsuit lawyer. 

To read more like this visit: https://www.lawyersandsettlements.com/articles/Credit-Union-excessive-overdraft-fees/credit-union-excessive-overdraft-fees-lawsuit-5-21198.html#.VpjveMIUWM8 



Comments

Post a Comment

Please no profanity or political comments.

Popular posts from this blog

Why Auto Lending Is Starting To Stand Out As A Real Threat To CUs

  By Ray Birch MILWAUKEE—Auto lending is emerging as one of the biggest areas of risk for credit unions, even as the broader U.S. economy continues to perform better than many expected, according to Bill Handel, chief economist at Raddon, a Fiserv company. Delinquency trends in auto portfolios are now approaching levels last seen during the Great Financial Crisis, Handel said, driven by a combination of high vehicle prices, elevated interest rates and increasing financial pressure on lower-income consumers. “There’s probably still a lot of risk in the auto portfolios,” Handel said. “Our numbers in terms of delinquency behavior in the United States are now rivaling what they were during the Great Financial Crisis.” Economy Holding Up Better Than Expected Despite those pockets of risk, Handel said the broader economy remains surprisingly resilient. “If you look at the U.S. economy, it’s actually performing quite well—probably better than most people would have anticipated,” he said. ...
Post a Comment
Read Complete Article HERE>»

When Cooperation Turns To Competition: A Turning Point For The Firefighter Credit Union Movement

  By Grant Sheehan For decades, firefighter credit unions have stood as a model of what cooperative finance is meant to be—institutions built not to compete ruthlessly, but to serve a shared mission: supporting the financial well-being of those who risk their lives in service to others. That’s what makes the recent actions of Firefighter First Credit Union so concerning. Firefighter First FCU was not just another participant; it was a founding member of the National Council of Firefighter Credit Unions (NCOFCU). It helped shape the very principles of collaboration, mutual respect, and non-encroachment that have long defined our community. Those principles weren’t accidental; they were intentional safeguards to ensure that firefighter-focused credit unions could grow together, not at each other’s expense. But something has changed. Firefighter First FCU’s decision to pursue a nationwide charter marks a clear shift in direction—from cooperation to direct competition. This isn’t simpl...
Post a Comment
Read Complete Article HERE>»

Small Credit Unions Don’t Lack Representation—They Lack Board Education

  By Grant Sheehan Let’s be clear— representation  for small credit unions is not something new that suddenly needs to be invented. For more than 150 years in Europe and 115 years in the U.S., many of us—along with numerous trade groups representing postal workers, schools, hospitals, the military, first responders, electricians, welders, auto workers, and many other sponsor employee groups—have been actively representing and supporting small credit unions. The mission has always been the same: protect these institutions and ensure they have a voice. The real challenge facing small credit unions has never been a lack of organizations claiming to represent them. The challenge has been engagement and education. Many small credit unions operate with extremely limited resources. Their boards are made up of volunteers who already have full-time careers. Even when scholarships, training opportunities, and conferences are offered, the realities of travel costs, staffing shortages, op...
Post a Comment
Read Complete Article HERE>»

With Graham Signaling New Budget Bill, Credit Unions Brace For Tax Debate

By Ray Birch WASHINGTON— Senate Budget Committee Chairman Lindsey Graham’s comments Wednesday that Republicans will “expeditiously move toward creating a second budget reconciliation bill” are giving new shape to what had been a speculative discussion in Washington—and prompting renewed attention within the credit union industry to whether the movement’s federal tax exemption could again surface as lawmakers look for possible offsets. In a post on X, Graham said that after consulting with President Trump, his team and Senate Majority Leader John Thune, the Senate Budget Committee will move quickly on a second reconciliation package focused on “adequate funding to secure our homeland” and support for the military. The remarks are notable because they offer one of the clearest indications yet that a second fast-track budget measure—previously discussed but far from certain—may now be gaining traction. CUToday.info on Wednesday reached out to House Budget Committee Chairman Jodey Arringto...
Post a Comment
Read Complete Article HERE>»

Sunday Reading - How were the National Parks started?

  America's 'Best Idea'       How were the National Parks started? America's National Park System includes roughly 85 million acres of US territory, equal to the size of Germany, set aside by federal law for preservation. There are 63 areas officially designated as national parks—including the Grand Canyon, the Great Smoky Mountains, and Acadia—and more than 400 additional smaller units ( see map ). In 1872, Yellowstone was established   as the first national park dedicated to public enjoyment and recreation, though its foundation also  displaced several Native American tribes . By 1916, the growing system required the creation of the National Park Service to preserve its lands for future generations. Eventually, hunting and logging were banned in the parks, though regulated extractive activity is still permitted in nati...
Post a Comment
Read Complete Article HERE>»

Celebrating 40 Years Of Credit Union Impact

From shaping the industry’s approach to data to framing the conversation around key industry issues, here’s a look at the impact we’ve made — and what’s to come Aaron Passman Let’s take a trip back in time. It’s Monday, April 1, 1985. You’re headed home from work at the credit union, one of more than 10,000 nationwide. You’re sitting behind the wheel of a Chevy Cavalier — the top-selling car in America at the time — with “We Are The World” piping out of the speakers. Not surprising, as it’s the No. 1 song in the country. You’ve got to make a stop at the grocery store, where the price of eggs has dropped to about 50 cents a dozen — roughly 20 cents cheaper than one month prior — but you’re already starting to think ahead to the weekend. Maybe you’ll head to the theater for “Police Academy 2,” and see what all the fuss is about — after all, it’s the most popular movie in America. But tonight you’re planning to sit down for the NCAA championship game to see whether Villanova can pull off ...
Post a Comment
Read Complete Article HERE>»

Setting & Meeting Your 2018 GOALS - Dan Berger

A new year provides a fresh start and a clean slate and is often the time when resolutions and goals are established. If you are in the process of setting new goals – as I am – know that with an open mindset, achievement of all your goals is possible. "Goals provide clarity," writes Mareo McCracken, revenue leader of Movemedical. He explains that goal setting is about "combining the fortitude to achieve with clear thinking while making sense of your purpose and defining your ability to deliver value to others." However, goal setting and achieving also requires faith – or believing and hoping in something you can't see yet or that doesn't quite exist. For many of us, the No. 1 reason we don't achieve our goals is that we lack belief in ourselves and our abilities. I encourage you to read an article by Inc.com contributor Benjamin Hardy  that details the importance of having this kind of faith in yourself and delivers some tips on how to achie...
Post a Comment
Read Complete Article HERE>»

Embracing ARMs And Battling Members’ Misconceptions

With adjustable-rate mortgages back in fashion, credit unions are educating members about the ins and outs of these products, dispelling misunderstandings along the way. With housing stock low, home prices high, and interest rates showing no signs of coming down, many credit unions are turning to adjustable-rate mortgages to help would-be borrowers find a home. ARM loans gained a bad reputation after the 2008 housing crisis and the Great Recession, but credit union leaders insist that with the right education and a clear understanding of how the product works, adjustable-rate mortgages can be an ideal solution for would-be homeowners. The Big Picture53% of those who don’t own a home believe homeownership is out of reach, according to a study from Northwestern Mutual . 58% of millennials feel this way, but roughly half of baby boomers and Gen X share the sentiment. According to Federal Reserve data, the average price of a home topped $510,000 at the end of 2024. That’s 32% higher than f...
Post a Comment
Read Complete Article HERE>»

Lifesaving Companion Dog Takes On New Role With Injured Firefighter « CBS New York

Lifesaving Companion Dog Takes On New Role With Injured Firefighter « CBS New York : "NEW YORK (CBSNewYork) — A badly injured New York firefighter received a companion dog whose already saved people’s lives from fire. As CBS2’s Dave Carlin reported, disabled firefighter Tom Prin beamed as he was officially presented with his new canine companion Halona inside of a packed ceremony in Suffolk County. The former firefighter was one of 15 people receiving their canine companions. Prin was chosen because of what he’s been through — after fracturing his neck and back while responding to a Brooklyn fire. “When I was going from the third to fourth floor, the steps gave out and I fell through the fire escape,” he said. Prin has endured five spinal surgeries, but the Holtsville man will now be comforted by Halona who has quite the lifesaving resume herself." Click HERE to read full story and see video 'via Blog this'
Post a Comment
Read Complete Article HERE>»