Ent Credit Union will refund some fees for overdrafts and insufficient funds transactions under a class-action lawsuit settlement announced this week by the Colorado Springs-based financial giant.
Azar & Associates, the law firm headed by high-profile personal injury lawyer Frank Azar, and a Washington, D.C., law firm filed the suit in March in Denver federal court on behalf of two Ent members in El Paso County and Tarrant County, Texas. The suit alleges that the $6 billion credit union improperly charged overdraft fees on debit card transactions that didn’t overdraw accounts.
While the exact terms of the settlement weren’t disclosed, Ent said in a news release that it will refund “all the identifiable overdraft fees and insufficient funds fees raised in the lawsuit, an action all parties felt was in the best interest” of Ent’s nearly 370,000 members. Ent didn’t estimate how many members were affected or how much it will refund, and a spokeswoman didn’t respond to a call or email seeking comment.
Ent’s statement attributed the “excess” fees to software issues that it wasn’t aware of until the suit was filed. One issue resulted from a default hold setting in its transaction processing software that allowed for a debit card transaction that triggered a “courtesy pay charge” even though the account had a positive balance at time (but was negative when Ent later processed the charge). The second issue resulted from multiple attempts by merchants to collect charge payments, triggering multiple fees.
“We are truly sorry for the inconvenience this has caused our members and are grateful to both our members and their attorneys for bringing it to our attention,” Ent CEO Chad Graves said in the statement. “While we believe our member agreement allowed for the charges in question, the way the fees were assessed isn’t consistent with our values, nor were they policies we would have ever intentionally created. That’s why we are refunding all of the fees in question, plus interest to members” who were charged the fees during the past three years.
Ent said in the statement that it has changed both processes to avoid a reoccurrence of the issues. Since the processes were modified, the credit union has been searching its transaction data to determine all members affected by the issues. While internal and external experts are continuing to assess the impact of the issues, Ent said it expects to contact all affected members with refunds by year’s end.
Azar & Associates is one of Colorado’s largest law firms, employing 45 lawyers along the Front Range. It advertises extensively on television, portraying Azar as “The Strong Arm.”