POUGHKEEPSIE, N.Y.–Hudson Valley Federal Credit Union has agreed to pay $95,000 to resolve allegations it violated the Servicemembers Civil Relief Act.
The U.S. Attorney’s Office for the Southern District of New York said the credit union violated the Act by illegally repossessing seven vehicles owned by members of the military who were protected by the SCRA. The U.S. Attorney’s Office said that under the terms of the agreement Hudson Valley Credit Union will pay approximately $65,000 to seven individuals and also pay a civil penalty of $30,000 to the U.S. government.
The agreement resolves all claims and causes of action contained in the U.S. complaint filed against the company, according to the U.S. Attorney’s Office.
In a statement, the $4.8-billion Hudson Valley FCU said the settlement is not an admission of liability, adding “no legal determination was made as to whether” the seven instances constituted violations of the Act.
“The men and women of our military deserve our unwavering support, so when we learned of the (U.S. Department of Justice) inquiry in 2016, we immediately reviewed our procedures to ensure compliance with the SCRA,” said Mary D. Madden, president and CEO of the credit union.
The Alleged Violations
According to the U.S. Attorney, the credit union allegedly had not obtained required court orders before repossessing the seven vehicles. The investigation further found HVFCU lacked “written policies or procedures that addressed the SCRA's protections against non-judicial auto repossessions."
Under terms of the agreement, Hudson Valley FCU is paying $10,000 to six of the affected service members, in addition to any lost equity in the vehicle with interest. It is also paying $5,000 to another service member whose vehicle was repossessed but returned within 24 hours.
The credit union has also taken steps to fix the credit of these service members, according to the U.S. Attorney’s Office.