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Credit Union 1 Multiple Non-Sufficient Funds Fees on One Item Class Action

Credit Union 1 (CU1) is the second-largest credit union in Alaska. The complaint for this class action alleges that CU1 has improperly been charging additional fees on a single item if it gets presented for payment more than once. Until it changed its disclosures, the complaint says, the multiple charges on single items violated its agreements with customers.

The class for this action is all CU1 checking account holders who, during the applicable statute of limitations up until February 2020, were charged more than one NSF fee on a single item or transaction on a CU1 checking account.

In February 2020, the complaint says, “CU1 amended its Account Documents to inform accountholders that they may incur an NSF fee each time a previously returned item is presented for payment against insufficient funds.”

However, the complaint alleges that CU1 has been following this practice for quite some time, even before its agreements allowed it to do so. Before this change, the account documents indicated it would only charge one NSF or overdraft (OD) fee per item.

The plaintiff in this case, Kamiesha Calhoun, claims she was charged multiple fees on a single item before the bank changed its agreements.

For example, Calhoun attempted to make an ACH payment on July 19, 2019 for the amount of $109.06. Because she did not have enough money in her account to pay this transaction, CU1 rejected it and charged her a $22 NSF fee. This first fee was permitted by the account documents, the complaint claims.

She did not ask CU1 to process the item again, but on July 23, without her knowledge, CU1 did try to process it again. Because her account still did not have the funds to pay the transaction, CU1 again returned the item. It also charged her a second NSF fee of $22.

Two days later, on July 25, without Calhoun’s knowledge, CU1 again undertook to process the item. Again, the account did not contain sufficient funds to pay the transaction, so CU1 charged Calhoun a third NSF fee, bringing the total fees it had charged her on this single item to $66.

The complaint quotes the Member Service Agreement in effect at the time CU1 charged Calhoun these fees: “If the available balance of funds in a spending account [is] not sufficient to pay a check or other item presented on the account, we may return it for insufficient funds, and require a service charge for the dishonored check or item…”

The complaint argues, “The same ACH payment is not a new ‘item’ each time it is rejected for payment then reprocessed, especially when—as here—[Calhoun] took no action to resubmit the item.” It claims that CU1 thus breached its agreements when it charged more than one fee on a single item.

Article Type: Lawsuit
Topic: Consumer

Most Recent Case Event

Credit Union 1 Multiple Non-Sufficient Funds Fees on One Item Complaint

April 9, 2021

Credit Union 1 (CU1) is the second-largest credit union in Alaska. The complaint for this class action alleges that CU1 has improperly been charging additional fees on a single item if it gets presented for payment more than once. Until it changed its disclosures, the complaint says, the multiple charges on single items violated its agreements with customers.

Credit Union 1 Multiple Non-Sufficient Funds Fees on One Item Complaint

Case Event History

Credit Union 1 Multiple Non-Sufficient Funds Fees on One Item Complaint

April 9, 2021

Credit Union 1 (CU1) is the second-largest credit union in Alaska. The complaint for this class action alleges that CU1 has improperly been charging additional fees on a single item if it gets presented for payment more than once. Until it changed its disclosures, the complaint says, the multiple charges on single items violated its agreements with customers.

Credit Union 1 Multiple Non-Sufficient Funds Fees on One Item Complaint
Tags: Excessive Fees, Insufficient or Non-Sufficient Funds Fees, More Than One Fee Assessed on a Single Item/Transaction, Your Bank