SALT LAKE CITY—One credit union’s migration to a new checking account structure has led to some member complaints—including one member who has taken to Facebook—and local media attention.
Some members of America First Credit Union complained to KSL-TV and KSL.com over the move to a new premium paid option on checking. According to the report, the rollout plan was intended to show members the benefits of the new premium option, which incurs a $6 monthly fee, a credit union spokesperson told the news outlet.
But the report also quoted 30-year member Kyle Brokaw as saying, “he felt deceived.”
The report cited an email sent by America First to Brokaw in which he was notified his account would automatically be switched over to a premium option and would be charged a $6 monthly fee — “something he didn't want to happen. Nowhere in the email did it clarify he had the choice to opt-out of the new program, a choice he only learned about after getting in contact with a customer service representative, he said,” according to KSL.com.
‘Kind of Underhanded’
"I felt like it was kind of an underhanded thing to do," he told KSL.com. "I know it's not a ton of money, but … I'm sure older people are on a fixed budget — that would also severely impact them. It seems like a lot of people aren't even going to read that email.”
Brokaw said the email notified him in bold lettering his account would be automatically converted, but the information about the cost was buried in the middle of a paragraph, KSL.com reported.
Nicole Cypers, a spokesperson for America First, told KS.com every single America First checking account will be discontinued and converted to a new system, which offers a classic free version and a premium paid version.
The premium account is free if members maintain a checking balance of at least $1,500, have a direct deposit in the account of at least $500, and complete 20 or more transactions with their credit or debit card monthly.
Benefits Offered
The new premium checking account offers several benefits, according to America First’s website, including no low-balance fees, unlimited monthly transactions, access to a nationwide network of more than 35,000 free ATMs, a mobile phone protection option, and a rewards payback plan.
“Minors' accounts, or those owned by someone under the age of 18, will automatically be switched over to the classic free version and all adult accounts, regardless of the amount of money in them, will be automatically transitioned to the premium paid version,” the news outlet reported. “If a member has multiple checking accounts, only their main account will be switched to premium, with the rest transitioned to the new classic, or free, option. Business accounts will also not be converted to the premium account.”
Cypers told KSL.com that at some point all members who meet the above criteria will be notified either by email or by letter that their account is eligible and will be moved over to the new system within 30 days of receiving the notice. Notices are being sent out in waves, with the first batch sent out last week, Cypers told KSL.com.
America First has approximately 1,159,000 members and Cypers was quoted as saying the CU’s call center wouldn't be able to handle a large number of calls at once without the gradual rollout.
"They're being sent out in waves so that questions that are coming into our call center, we're able to manage that and help members so we don't have long wait times for them," Cypers told KSL.com. "We're able to help them answer questions, talk them through it, convert them maybe if they choose (they don't want premium)."
‘Allowing Them to Try It’
Cypers further told the news outlet that if action isn't taken before the 30 days, the account will be converted into a premium account, but members won't be charged right away. The credit union offers the first two months free, after which they will be charged a monthly $6 fee, KSL.com reported.
"We're allowing them to try it so that they can see what a benefit this will be to them," Cypers told KSL TV. "So that's why everyone's being converted to premium and then they have a choice that they can make — switch back to classic if they choose to."
Brokaw told KSL-TV there's nothing wrong with the plan itself, but he takes issue with the way they chose to automatically sign members up regardless of what they wanted.
"I don't have any problem with them offering a service at all, but I probably would have looked into it a little more and see if it was advantageous for me; but the fact that they did it the way they did it, I wouldn't even sign up to it now — just out of principle," Brokaw told KSL.
According to the report, “regardless of the credit union's intentions, Brokaw said it felt like a ploy to make money off of unsuspecting members.”
A Warning on Facebook
"I don't see how they could start charging somebody a fee for something that costs more when they're also offering the previous service that originally was signed up for without that person's authorization,” he told the news outlet.
Brokaw said that in an effort to warn people of the upcoming change to the checking program, he has penned a Facebook post informing members of the premium switch.
"I would expect this from banks, but not member-based credit unions," he wrote. KSL reported that others also reached out to the credit union on social media, voicing their concern with the new system.
Cypers told KSL America First doesn’t have plans to change its rollout method, adding "We are so confident in the benefits that come along with this, we want individuals to look into it to see. It's a great way to research and try a new product with no cost for a couple of months.
CU Issues Statement
Following the KSL report, the credit union issued a statement reading:
"America First Credit Union has always worked hard to provide the best service and products for our members and their families. Our intent and values have always been and will continue to be doing what is in our members' best interest.
"Responding to members, we launched Premium Checking, which provides a multitude of services, savings and protections. Members can choose to convert to Classic Checking, which has no fee. However, we are confident members will see the value and benefits of Premium Checking that we are giving all members 60 days to try it for free.
"Premium Checking will give members access to more than $135 worth of additional services, savings and protections each month. Benefits include identity theft protection, mobile phone insurance coverage for every mobile phone you own, credit and dark web monitoring, premium account payback, ATM fee offsets, attractive coupon programs for discounts at local and national retailers, and more.
"While Premium Checking is now the preferred checking account because of the benefits it offers, those who would prefer to utilize our free Classic Checking account can do so by contacting a member service representative through our dedicated Premium Checking hotline at 1-888-476-2143, through online banking chat, or by stopping by their local branch.
"America First will continue communicating with our membership to offer the best products and service to our members. "