According to a recent NSF fee class action lawsuit filed by several plaintiffs against Patelco Credit Union, the financial institution may be violating member contracts and laws in order to make a profit.
About the Patelco Credit Union NSF Class Action Lawsuit
Plaintiffs Roxanne W., Claudine S., and Barbara B. claim that Patelco, a California-based credit union serving more than 360,000 members, routinely engages in predatory practices regarding the collection of NSF and other fees.
The plaintiffs claim that Patelco has assessed overdraft fees on transactions even when the member had enough money in their account to cover the cost of the purchase, as well as charging multiple non-sufficient fund (NSF) fees for single transactions. According to them, these practices may not only be in violation of the credit union’s own member contracts, but may also be illegal.
According to the NSF class action lawsuit complaint, Patelco immediately reduces the “available balance” in a member’s account at the moment that a debit card transaction is authorized, in order to show the new accurate account balance, minus the cost of the purchase. However, the credit union often does not process these transactions until days later. At this point, the credit union allegedly may assess an overdraft fee if the current balance of the account is too low to cover the cost of the purchase, despite the transaction having been made several days before.
Additionally, the plaintiffs report that Patelco often improperly assesses NSF fees. According to them, Patelco charges a $28 NSF fee when a member attempts to make a transaction and the credit union determines that they do not have enough funds to cover the cost. At this point, Patelco denies the transaction and assesses a fee. However, the plaintiffs claim that the credit union may attempt to process the transaction a second time, without the knowledge or authorization of the account holder. These additional attempts to process the transactions may result in multiple $28 NSF fees being applied to the same initial denied purchase.
The plaintiffs claim that overdraft and NSF fees are a major source of profit for banks and credit unions, generating tens of billions of dollars every year. Due to the amount of revenue generated by NSF and overdraft fees, the plaintiffs claim that credit unions such as Patelco may be incentivized to continue collecting these fees, even when they are not assessed accurately.
According to a Pew study from 2016, the profit made from these fees may be coming from the poorest and most vulnerable consumers. Less than 20 percent of account holders pay more than 90 percent of overdraft and NSF fees. Additionally, these same consumers are more likely to have incomes below the average, and may pay around a full week’s worth of wages in overdraft fees each year.
Many of these fees may also be assessed due to deceptive or predatory practices. According to the Pew study, more than 40 percent of the largest financial institutions in the U.S. reorder transactions. Rather than processing these purchases chronologically, these institutions may move the charges around and process them from largest to smallest. In addition to making it difficult for account holders to determine their account balance, this practice may also result in multiple fees being assessed for a single transaction.
If you believe you have been assessed predatory overdraft or NSF fees by your credit union, you may qualify to speak with an experienced attorney about your legal rights. You may be eligible to join an NSF class action lawsuit and pursue compensation and reimbursement for any inappropriate charges.
Roxanne, Claudine, and Barbara’s NSF Class Action Lawsuit is Case No: 4:20-cv-4586, filed in the U.S. District Court for the Northern District of California.
Join a Free NSF Fee Class Action Lawsuit Investigation
You may qualify to join this NSF fee class action lawsuit investigation if you were unfairly charged NSF fees by one of these banks:
I am too a victim of the abuse of authority at patelco Bank. The don’t process my purchases in a timely manner they wait days and days then loop purchases together their online app that’s supposed to help the customer never is accurate then I get fees . I’m tired of being taken advantage of . Also I get 2 direct deposits each month they hold my deposit until they access fees . I’m tired of the madness
I am too a victim of the abuse of authority at patelco Bank. The don’t process my purchases in a timely manner they wait days and days then loop purchases together their online app that’s supposed to help the customer never is accurate then I get fees . I’m tired of being taken advantage of . Also I get 2 direct deposits each month they hold my deposit until they access fees . I’m tired of the madness
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One thought on NSF Class Action Lawsuit Accuses Patelco Credit Union of Unfair Fees
I am too a victim of the abuse of authority at patelco Bank. The don’t process my purchases in a timely manner they wait days and days then loop purchases together their online app that’s supposed to help the customer never is accurate then I get fees . I’m tired of being taken advantage of . Also I get 2 direct deposits each month they hold my deposit until they access fees . I’m tired of the madness