BOULDER, Colo.–Elevations Credit Union has become the latest to be hit with a lawsuit over its overdraft practices. The suit was filed by a law firm that has targeted other credit unions.
The 19-page suit filed in Boulder District Court was officially filed by plaintiff Kendall Carson, a member of the CU who is alleging Elevations’ overdraft fees have been assessed on purchases that didn’t actually draw accounts into a negative balance, according to the Daily Camera.
The suit alleges when Elevations authorizes a debit card transaction from an account holding enough balance to cover the full purchase, the credit union immediately reduces accounts for the amount of the purchase, sets aside funds in a checking account to cover the transaction and the members available balance reflects the subtracted amount, the Daily Camera reported.
“As a result, customers’ accounts will always have sufficient available funds to cover these transactions because Elevations has already sequestered these funds for payment,” the suit states, as cited by the Daily Camera. “However, Elevations still assesses crippling $31 overdraft fees on many of these transactions and misrepresents its practices in its account documents.”
The lawsuit goes on to allege that when a later purchase is made and draws the account into negative territory due to the unavailability of the previously sequestered funds for the earlier purchase, “Elevations charges overdraft fees even on the initial transaction,” the Daily Camera stated. Denver-based law firm Franklin D. Azar and Associates, which has led similar lawsuits seeking class action status against other credit unions, is representing the plaintiff. Azar & Associates has also filed a similar lawsuit against Colorado-based Canvas Credit Union.
A spokesperson for Elevations Credit Union declined comment on the lawsuit, but added, “We do however want to assure our membership that we will fully investigate and respond to the claim, in the manner required by applicable law.”