Consumers across America are complaining about rising overdraft fees that are not only found in big banks but also credit unions.

While credit unions have a more friendly reputation than banks, as they are run by members rather than a corporation, a number of them have been accused of enacting the same unfair overdraft fees practices as banks. First Technology Federal Credit Union is one of the credit unions facing these allegations, with the financial institution’s overdraft fees being as high as $28.

The specific information of First Technology Federal Credit Union overdraft protection services can be found on the credit union’s website, stating that the overdraft protection is for the customers’ benefit.

Specifically, First Technology Federal Credit Union overdraft protection works by first linking a member’s First Tech checking account with a secondary account like savings or line of credit. Once the primary checking account becomes insufficient, available funds from the secondary account are transferred to cover the transaction.

The fee for First Technology Federal Credit Union overdraft protection is $28 per insufficient fund transaction.

Overview of First Technology Federal Credit Union Overdraft Protection

Overdraft fees occur when a bank or credit union has to transfer money from a secondary account to the primary checking account when the checking account becomes insufficient to cover a transaction.

Also called insufficient fund fees, each bank and credit union offers their own overdraft protection programs. However, as of August 2010, it became illegal for banks and credit unions to implement overdraft protection to customers unless if the customers specifically sign up for the service.

When opening a new account at First Technology Federal Credit Union, there is overdraft protection section that allows new members to authorize overdraft protection. However, members must reportedly order in preference what they prefer to use a secondary line of money for overdraft purposes including consumer line of credit, savings account, or another account.

It is important to note that new members are not provided instructions or information of how to decline First Technology Federal Credit Union overdraft protection, which may appear to indicate that this service required rather than optional.

Not only is overdraft protection supposed to be optional, but credit unions and banks must also index transactions based on date and not amount. Customers have previously complained that banks and credit unions would do this out of chronological order to allegedly maximize on overdraft fees.

Customers who believe they were unfairly charged overdraft fees may be able to file legal action against their respective credit union or banks. Potential claimants should contact a specialized lawyer to determine their eligibility for an overdraft protection lawsuit.

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