Suit Charges Inadequate Fee DisclosuresAt CU ATMs

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PAWTUCKET, R.I. - (04/13/05) -- In an action that could have broadramifications among credit unions and banks, a local attorney fileda purported class action suit here Monday claiming Pawtucket CUviolated the Electronic Funds Transfer Act by failing to properlydisclose the fees it charges non-members on its ATMs. The suit wasfiled in state court on behalf of a local resident, Minoska Pena,but is expected to be joined by others as part of a class action,according to Christopher Lefebvre, the attorney representing Pena.Lefebvre said that the state's second largest credit union failedto make proper disclosures on fees charged to non-credit unionusers on its 12 ATMs, despite a requirement under the EFT Act, alsoknown as the Federal Reserve's Reg E, that fees must be disclosedconspicuously and prominently both on the front of the machines andon screen. "It's going to be up to the courts to determine whatthat means," Lefebvre told The Credit Union Journal. Credit unionofficials refused to comment Tuesday, saying they had not seen thesuit yet. "At this point, without having been served, it'spremature to really say what is, or what isn't going on," saidTimothy Germaine, vice president of the $800 million credit union.Violation of the EFT Act could bring a fine of up to $500,000, aswell as reimbursement of fees charged to consumers. Lefebvre, alsofiled similar suits against three national banks in federal courtin Boston Monday; Bank of America, Sovereign Bank and CitizensBank, and claimed that lack of adequate disclosure is prevalentamong both credit unions and banks. "If you took a survey, youwould be surprised how many banks and credit unions fail miserablyat complying with the law," he said.

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