Navy Federal Credit Union ordered to pay $95M for ‘illegal surprise’ overdraft fees

by Pensacola News Journal

Navy Federal Credit Union will pay $95 million in fees and refunds for charging illegal overdraft fees to its customers, the Consumer Financial Protection Bureau announced Thursday.

According to the CFPB, from 2017 to 2022 Navy Federal charged customers surprise overdraft fees on certain ATM withdrawals and debit card purchases, even when their accounts showed sufficient funds at the time of the transactions.

The CFPB is ordering Navy Federal to refund more than $80 million to consumers, stop charging illegal overdraft fees, and pay a $15 million civil penalty to the CFPB’s victims relief fund, according to a Bureau news release Thursday. This is the largest amount the CFPB has ever obtained from a credit union for illegal activity.

“Navy Federal illegally harvested tens of millions of dollars in junk fees, including from active duty servicemembers and veterans,” CFPB Director Rohit Chopra said in a statement. “The CFPB’s work to rid the market of illegal junk fees has saved American families billions of dollars.”

 

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