Meriwest Credit Union is a Bay Area financial institution, located in San Jose, Ca. According to its website, Meriwest focuses on checking, savings, auto, loans, mortgages, and business banking.

However, according to some consumer advocates, significant questions have been raised regarding Meriwest Credit Union’s overdraft fees.

“Overdraft protection” in many different financial institutions, including Meriwest Credit Union, simply means that when a customer makes a transaction that would overdraw his or her bank account, the financial institution would pay the transaction instead of rejecting, essentially loaning the customer the amount of money needed to pay the transaction.

According to Meriwest Credit Union’s website, the bank offers “overdraft protection” as an opt-in policy.

The “overdraft protection” often arises when a customer overdraws on his or her bank account, which may occur during a point of sale transaction or when a check bounces and there are not sufficient funds located in the account.

The drawback for the customer is that the institution typically charges the consumer a fee for each “overdraft protection” transaction paid, and requires each consumer to deposit funds to return their account to an initial good standing.

Meriwest Credit Union currently charges a $35 fee for each overdraft that it covers through overdraft protection. Moreover, this overdraft protection fee is charged each time a transaction goes through once the account in already overdrawn, with no cap on how many overdraft protection fees can be charged per day.

For smaller overdraft transactions, the customer may be charged fees many times the amount of the transaction that caused the consumer’s bank account to be overdrawn.

Meriwest Credit Union Overdraft Fee Policies

According to reports and recent accusations made by consumers of Meriwest Credit Union and many other financial institutions, some banks are accused of posting transactions in the order that suits their own interests.

For example, a financial institution may post a transaction in the order of largest to smallest, instead of the order in which the transaction was made. So if a consumer makes a transaction of a very large amount, which thereby overdraws their account, a bank might want to post that transaction first so that each subsequent transaction made thereafter is charged  a fee for “overdraft protection.”

Meriwest’s overdraft protection does just that. According to Meriwest’s Courtesy Pay overdraft protection policy, “transactions may not be processed in the order in which they occurred; therefore, the order in which transactions are received and processed may impact the total amount of fees incurred.”

It continues to state, “the order of item payment may create multiple overdrafts during a single banking day for which you will be charged our Paid NSF fee of $35 for each overdraft item paid.”

Additionally, the Courtesy Pay Brochure maintains, “We reserve the right to determine the timing and order in which such transactions are posted to your account to the extent permitted by law.”

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