VIENNA, Va.—Navy FCU has agreed to a $1.7 million settlement in a class action lawsuit that alleged it had violated the Electronic Fund Transfer Act.
The settlement still requires approval from Judge William Q. Hayes of the United States District Court for the Southern District of California.
The now nearly two-year-old case, file by plaintiffs Jeffrey Stephenson and Billy Smith II, alleges that Stephenson reported unauthorized charges made on the debit card of Billy Smith II, who is Stephenson’s son, to Navy FCU and that the credit union’s policy is to “deny” consumers claims with “letters stating “no error occurred.”
The plaintiffs said they provided documentation to the world’s largest CU.
Additional Allegations
That practice, the plaintiffs allege, violates the EFTA and also breaches the “express terms of its Account Disclosures, including the Debit Card Disclosure, and violates the implied covenant of good faith and fair dealing.”
As court documents state, Navy FCU has denied the allegations.
“But given the risks, uncertainties and burdens of continued litigation, the Parties agreed to settle, according to the terms of the Agreement,” the court documents state.
