Another Wave of ATM Fee Lawsuits Hitting Credit Unions

As another rash of lawsuits are filed against financial institutions for failing to properly disclose ATM fees, CUNA Mutual Group reminds credit unions simple preventative steps can help you avoid costly fines and legal fees. When credit unions charge a fee to a consumer using a non-credit union ATM network card or debit card, section 205.16 of the regulation requires:

  • Posting a sign in a prominent and conspicuous location on or at every ATM owned or operated by the credit union stating that a fee will (or may) apply, and
  • Disclosing the fee on the terminal screen or paper notice before the consumer is committed to paying the fee. It is not necessary to include the amount of the fee on the sign.

The lawsuits typically involve missing signage on or at the ATM and incorrect fees disclosed on the sign at the ATM. In addition, many of the lawsuits involve remote ATMs serviced by third-party vendors. Many credit unions involved in the lawsuits erroneously believed the fee notice sign was not necessary since the fee was disclosed on the terminal screen.

Credit unions must be vigilant in ensuring their ATMs satisfy the fee disclosure requirements. Lawsuits can be avoided simply by inspecting the ATMs periodically to ensure the fee sign is intact. Another way to avoid lawsuits is to not place the fee amount on the sign. The regulation does not require the amount of the fee to be included on the sign.

CUNA Mutual Bond policyholders, who represent more than 90 percent of U.S. credit unions, can visit CUNA Mutual’s Protection Resource Center at to access a webinar and other risk prevention tools that can help credit unions prevent further losses.

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Posted in Compliance News, CUNA, Events.