Consumer complaint received 2025-11-17 00:00:00
Product: Checking or savings account — Checking account
Issue: Managing an account — Deposits and withdrawals
Company: NAVY FEDERAL CREDIT UNION
State: OH

Complaint narrative:
This is not a fraud dispute. 

This is a regulatory complaint alleging : XXXX. Final payment violation under UCC 4-214 XXXX. Wrongful dishonor under UCC 4-402 XXXX. Unauthorized right of setoff XXXX. Regulation XXXX violation for denial of account access and failure to comply with provisional credit mandate XXXX. Abusive practices under CFPB UDAAP standards ( PDF version of this full complaint is attached ) NFCU failed to meet mandatory ACH reversal deadlines, resulting in a statutory operational loss of {$180000.00}, then unlawfully seized more than {$950000.00} of settled funds from my accounts to force collection of a third-party civil claim. 

Evidence of Legal Entitlement and Good-Faith Reliance XX/XX/XXXX -- Union grievance filed demanding all money lost be recouped * * Establishes right to back-pay XX/XX/XXXX -- Signed Disposition : Pay as written, settle + close * * Confirms this was a settlement award XX/XX/XXXX -- Net {$950000.00} deposit labeled Adjusted Deposit appeared legitimate and intentional for discrimination grievance awared. 

XXXX XXXX XXXX -- Funds fully settled for XXXX days ; {$880000.00} transferred to savings ; {$110000.00} spent in good faith and reliance on funds. 

NFCU missed UCC reversal deadline -- Critically : No written notice of error, overpayment, repayment demand, or reversal warning was issued by XXXX at any time before Navy Federal seized my funds. 
The first written notice of any alleged overpayment was the XXXX demand letter dated XX/XX/XXXX ( Exhibit attached ). 

Navy Federals Unlawful Reversal & XXXX On or around XX/XX/XXXX : NFCU executed an untimely reversal exceeding $ XXXX, which does not appear on the statements provided. 

XX/XX/XXXX XX/XX/XXXX : NFCU liquidated all remaining assets using Adjustment-DR and Sav Adjustment-DR, including : {$890000.00} Membership Savings {$7000.00} Checking Additional internal withdrawals Total seized : more than {$950000.00} ( Exhibit attached ) NFCU had no lawful right of setoff because the alleged loss resulted from its own missed reversal deadline. 

Continuing Wrongful Dishonor NFCU also seized : Regular XXXX payroll deposits ( XX/XX/XXXX, XX/XX/XXXX, XX/XX/XXXX ) Multiple electronic transfers A {$65.00} XXXX deposit ( later returned ) This is Wrongful Dishonor under XXXX XXXX, because the bank seized legitimate income unrelated to the alleged deficit. 

Regulation E & UDAAP Violations Immediately after the reversal, NFCU revoked all online access, preventing me from : Seeing the reversal entry Identifying unauthorized debits Exercising Regulation E dispute rights within XXXX  days The mailed statements omitted the {>= $1,000,000} reversal entry entirely. 

This is : A Regulation E material interference violation Abusive conduct under CFPBs UDAAP Manual A deliberate concealment of operational liability The later return of only the {$65.00} XXXX proves NFCU knew at least XXXX XXXX was improper, yet refused to reverse the much larger unlawful debits. 

Because Navy Federal failed to act within the UCC reversal window, it lost its legal right to unilaterally charge back or seize the funds. At that point, any recovery should have occurred through civil process initiated by XXXX not through self-help account XXXX by the credit union XXXX 

Pending Civil Action XXXX has confirmed : They recovered {>= $1,000,000} The remaining disputed amount is {$180000.00} They are preparing litigation to collect it Under UCC 4-214, Comment 3, the tardy bank bears the loss once reversal deadlines are missed. The alleged {$180000.00} deficit therefore shifted legally to Navy Federal, not the consumer. 

Once Navy Federal allowed the deposit to fully settle, its statutory remedy was civil litigation, not unilateral XXXX. The credit union instead attempted to shift the loss to the consumer through internal debits and account freezes, which is NOT authorized under UCC 4-214.

Company public response: Company believes it acted appropriately as authorized by contract or law
Company response to consumer: Closed with explanation