PHILADELPHIA–Another lawsuit has been filed alleging a credit union acted illegally in its overdraft practices. The suit seeks class action status.
The lawsuit was filed by the firm Cohen, Placitella & Roth on behalf of plaintiff Aliesha Dailey of Upper Darby, Penn. against Philadelphia Federal Credit Union.
The suit seeks monetary damages and restitution as the result of what it alleges was the “unfair and unconscionable assessment and collection of multiple $28 “insufficient funds fees.” Similar to other suits filed against credit unions, the action alleges “unfair, and unconscionable” practices in breach of “promises made in PFCU’s adhesion contracts.”
“Specifically, PFCU unlawfully assesses multiple NSF Fees on a single Automated Clearing House (“ACH”) transaction or check,” the lawsuit alleges. “In PFCU’s sole and undisclosed view, each time PFCU processes an ACH transaction or check for payment after a having been rejected for insufficient funds, it becomes a new, unique item or transaction that is subject to another NSF Fee. But PFCU’s Account Documents never even hints that this counterintuitive result could be possible. PFCU’s Account Documents indicate that only a single NSF Fee will be charged for however many times the request for payment is reprocessed. An electronic item reprocessed after an initial return for insufficient funds cannot and does not fairly become a new, unique item for NSF fee assessment purposes. PFCU breaches its contract when it charges more than one $28 NSF fee on the same item, since the contract states—and reasonable consumers understand—that the same item can only incur a single NSF Fee.”
‘Victimized Plaintiff’
The lawsuit goes on to allege “Defendant’s improper scheme to extract funds from accountholders already struggling to make ends meet has victimized Plaintiff and thousands of other accountholders. Unless enjoined, PFCU will continue to engage in these schemes and cause substantial injury to Pennsylvania citizens.”
The $1.2-billion Philadelphia Federal has approximately 120,000 members. As CUToday.info has reported, several other credit unions have recently announced settlements of more than a million dollars in similar lawsuits.