Apple Federal Credit Union in Fairfax, Va., has agreed to pay $2.7 million to settle a class action lawsuit over its overdraft practices.
As a result of the settlement, the CU issued revised disclosures in April 2019 for consumer checking accountholders to clarify its policy regarding authorization and settlement procedures for debit transactions, according to the settlement. That includes non-recurring debit card transactions.
The settlement includes restitution from the institution for applying overdraft fees to deposit accounts that allegedly were never overdrawn and for accounts where non-recurring debit transactions were made. The settlement was approved by the court on Dec. 6.
Apple Federal Credit Union declined to comment.
The institution claimed that it complied with applicable law and regulations in addition to terms of member account agreements.
“Apple FCU does not admit any liability or wrongdoing of any kind, by this agreement or otherwise,” the settlement said.
The credit union argued that it entered into the agreement to avoid incurring further expenses, inconveniences and distractions of “burdensome and protracted litigation,” according to the settlement.
The settlement class includes current and former members with checking accounts at the $3 billion-asset credit union. Roughly $943,000 of the $2.7 million settlement went toward paying the plaintiff's attorneys' fees and expenses.
Several credit unions have faced overdraft litigation in recent years. More recently,
