Hanscon FCU Unlawful Imposition of Fees Class Action

Hanscom Federal Credit Union, claims the complaint for this class action, seeks “to maximize the fees it imposes on members.” It does this, the complaint says, by charging overdraft (OD) or nonsufficient funds (NSF) fees on accounts that had enough money to cover the transactions, and by imposing more than one NSF fee on a single item. The complaint claims that this violates Hanscom’s own agreements as well as federal law.

Regulation E

Under Regulation E, a financial institution may only charge OD fees on ATM or one-time debit transactions if the customer has opted in to its OD program. Also, the financial institution may not give customers different terms according to whether they opted in or not.

APPSN

Some institutions use what the complaint calls an “accounting gimmick” known as Approve Positive, Post Supposedly Negative (APPSN). It works this way: A debit or ATM transaction is approved. The money for the transaction is then set aside, and the customer cannot use it for any other purpose. However, this transaction does not settle immediately. If other transactions are made in the meantime which leave insufficient funds in the account, the institution then charges an OD or NSF fee when the first transaction comes up for settlement.

Multiple Fees on a Single Item

If an account does not have sufficient funds for a transaction, the institution may reject it and charge an NSF. Such items may be presented again for payment a few days later, without the knowledge of the accountholder. The complaint claims that Hanscom may then charge another NSF fee and reject it again, or may pay it and charge an OD fee. The complaint alleges that these multiple NSF fees on a single item are not permitted by Hanscom’s account agreements.

Three classes have been defined for this class action:

  • The APPSN Class is all US residents with accounts with HFCU who incurred an OD fee on a transaction that was authorized into a positive account balance, between August 31, 2014 and the date the binding arbitration clause in the September 1, 2020 HFCU Account Agreement becomes effective.
    The Repeat NSF Class is all US residents with accounts with HFCU who incurred more than one NSF on the same item, or an NSF fee and then an OD fee on the same item, between August 31, 2014 and the date the binding arbitration clause in the September 1, 2020 HFCU Account Agreement becomes effective.
    The Regulation E Class is all US residents with accounts with HFCU who incurred an OD fee for ATM or non-recurring debit card transactions between August 15, 2010 and the date the binding arbitration clause in the September 1, 2020 HFCU Account Agreement becomes effective.
Article Type: Lawsuit
Topic: Consumer

Most Recent Case Event

Hanscon FCU Unlawful Imposition of Fees Complaint

August 31, 2020

Hanscom Federal Credit Union, claims the complaint for this class action, seeks “to maximize the fees it imposes on members.” It does this, the complaint says, by charging overdraft (OD) or nonsufficient funds (NSF) fees on accounts that had enough money to cover the transactions, and by imposing more than one NSF fee on a single item. The complaint claims that this violates Hanscom’s own agreements as well as federal law.

Hanscon FCU Unlawful Imposition of Fees Complaint

Case Event History

Hanscon FCU Unlawful Imposition of Fees Complaint

August 31, 2020

Hanscom Federal Credit Union, claims the complaint for this class action, seeks “to maximize the fees it imposes on members.” It does this, the complaint says, by charging overdraft (OD) or nonsufficient funds (NSF) fees on accounts that had enough money to cover the transactions, and by imposing more than one NSF fee on a single item. The complaint claims that this violates Hanscom’s own agreements as well as federal law.

Hanscon FCU Unlawful Imposition of Fees Complaint
Tags: Additional charges in breach of contract, More Than One Fee Assessed on a Single Item/Transaction, Overdraft Fees, Your Bank