PARCHMENT, Mich.–Advia Credit Union here is asking a Washington, D.C. court to order the Consumer Financial Protection Bureau to turn over records the credit union said it needs to defend itself as part of a $40-million lawsuit related to its overdraft practices.
Advia is one of about a dozen credit unions nationally, including two in Michigan, being sued for allegedly using an “available balance” method rather than “actual balance” and then charging overdraft fees when members’ accounts are overdrawn. The credit union has denied there is anything wrong with how it processes members’ transactions.
In its response to the suit, which is filed in U.S. District Court for the District of Columbia, Advia Credit Union said it will provide evidence showing it disclosed its overdraft policies using a model form that is approved by the CFPB. Using the CFPB form, the credit union is arguing, means Advia is immune from the plaintiffs’ claims that it violated the U.S. Electronic Fund Transfer Act (EFTA) by failing to make proper disclosures about its overdrafts.
Advia is being represented by Shearman & Sterling.
The lawsuit comes as one law firm has been running newspaper ads headlined, ““Attention Credit Union Members: Has your credit union assessed multiple overdraft charges when you believed you had a sufficient balance?"
The newspaper ads in Detroit are being run by the Birmingham, Mich.-based Michael B. Serling law firm, which said it is seeking people who have been the victims of "multiple overdraft charges.” The Serling firm has been running similar ads seeking victims of mesothelioma and lung cancer caused by asbestos exposure.
"You're unaware and you're being deceived into what circumstances can put you into overdraft status," Philip J. Goodman, counsel with the Michael B. Serling law firm told the Detroit Free Press.
The full story on the law firm leading the suits, as well as how other lawyers view what is taking place on overdrafts, can be found here.