CUNA MUTUAL GROUP: Court Says Lawsuit Can Continue Against DCU Over Overdraft Fees

CUNA Mutual Group issued the following announcement on Nov. 13.

MARLBOUGH, Mass.—The $8.5-billion Digital Federal Credit Union here must face a lawsuit accusing it of charging overdraft fees to thousands of customers based on an artificially low “available balance” when they had ample money in their accounts, a federal judge in Massachusetts has ruled.

In a decision last week, U.S. District Judge Timothy Hillman in Worcester, Mass. said the customers could proceed with claims that the credit union breached its agreements with customers, which said an overdraft would occur only when customers did not have enough money in their account to cover a transaction. Digital instead based overdrafts on an available balance, calculated in a way that excluded some deposits and other transactions that had not settled, he said, according to Reuters.

The judge allowed counts dealing with breach of contract, breach of the implied duty of good faith and fair dealing, and violation of the Electronic Funds Transfer Act (only for claims that occurred on or after June 15, 2017) to stand, while dismissing the count dealing with unjust enrichment.

Original source can be found here.

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