Consumer complaint received 2025-03-27 00:00:00
Product: Checking or savings account — Checking account
Issue: Managing an account — Deposits and withdrawals
Company: NAVY FEDERAL CREDIT UNION
State: SC

Complaint narrative:
Formal Complaint to CFPB : Navy Federal Credit Union Fraud Dispute Mishandling I am submitting this formal complaint to the Consumer Financial Protection Bureau ( CFPB ) regarding Navy Federal Credit Unions mishandling of multiple fraud disputes on my checking account. Navy Federals actions constitute multiple violations of Regulation E ( Electronic Fund Transfer Act ) and have caused me severe financial hardship. Despite my repeated efforts to resolve this matter directly with the bank, Navy Federal has failed to comply with its legal obligations, and I am now requesting CFPB intervention to correct these violations and provide appropriate relief.

1. Provisional Credit Violations and Ongoing Unauthorized Charges Navy Federal failed to provide provisional credits during its prolonged fraud dispute investigations, violating 12 CFR 1005.11 ( c ) ( 2 ) ( i ). Some of my appeals dragged on for up to 60 days, yet no provisional credit was issued. Regulation E mandates that if an investigation can not be resolved within 10 business days, the financial institution must provisionally credit the consumers account for the disputed amount within those 10 days. Navy Federal ignored this requirement, depriving me of access to my stolen funds for months.

Failure to Secure the Account and Prevent Further Unauthorized Charges Even after I formally reported the fraud, Navy Federal continued allowing charges to post to my account, knowing that these transactions were disputed and would cause further overdraft fees.

I explicitly informed Navy Federal that I would not be clearing the negative balance until my fraud case was resolved.

I repeatedly requested that they block transactions, freeze my account, or even cancel my account to prevent further unauthorized charges, but they refused to do so.

Instead, Navy Federal knowingly allowed merchants to continue processing transactions, which they knew would bounce, leading to repeated overdraft fees that further deepened my financial hardship.

This lack of action is completely unacceptable. A financial institution has an obligation to protect a customers account from ongoing fraudulent activity. By failing to secure my account, Navy Federal amplified the damage to my finances, allowing unauthorized transactions to drain my account and pile up unnecessary fees.

2. Failure to Provide Documentation as Required by Regulation E When Navy Federal denied my fraud disputes, they refused to provide me with documentation or evidence supporting their decision. I repeatedly requested copies of the investigation results, transaction details, and any proof the bank relied upon, but I was told that Navy Federal used proprietary tools and would not share this information.

This violates 12 CFR 1005.11 ( d ), which states that if a financial institution determines that no error occurred, it must provide a written explanation of its findings and notify the consumer of their right to request the documents relied upon. Upon request, the institution is required to provide these documents.

By withholding all evidence and citing proprietary tools as an excuse, Navy Federal has directly violated this regulation and deprived me of the ability to challenge their decision or understand how they reached it. This lack of transparency is unlawful and unacceptable.

3. Improperly Shifting the Burden of Proof to the Consumer Throughout this process, Navy Federal has improperly shifted the burden of proof onto me, the consumer, rather than conducting a legitimate investigation to determine whether the transactions were authorized.

Under Regulation E and the Electronic Fund Transfer Act ( EFTA ), the burden of proof is on the financial institution to establish that a transaction was authorized. Specifically : 12 CFR 1005.11 states that if a consumer disputes a transaction as unauthorized, the bank must provide evidence proving that the transaction was legitimate.

Section 909 ( b ) of the EFTA confirms that the financial institution, not the consumer, bears the burden of proof in such cases.

Navy Federal, however, ignored these legal protections and instead insisted that I prove the transactions were fraudulent, even though they provided no evidence to support their denial. This approach is completely backwards and fundamentally unfair. The burden never falls on the consumer to prove they did not authorize a transaction it is the banks responsibility to prove that they did.

By refusing to present any proof, while simultaneously rejecting my dispute, Navy Federal violated federal law and left me with no recourse.

4. Criminal Charges Confirm the Transactions Were Unauthorized Since Navy Federal denied my fraud disputes, additional evidence has emerged confirming that the disputed transactions were, in fact, unauthorized. Law enforcement has conducted an investigation, and a warrant for the arrest of the individual responsible for unauthorized use of my account has been issued.

This development confirms that the transactions in question were not conducted by me and were not authorized. Even though law enforcement has determined that a crime occurred, Navy Federal has continued to deny my disputes and has refused to refund the stolen funds.

5. Severe Financial Hardship and Urgent Need for Resolution Navy Federals failure to comply with Regulation E has caused me severe financial hardship. Due to their negligence, I have : Been deprived of access to my stolen funds for months Accumulated overdraft fees and penalties caused by unauthorized transactions they refused to block Struggled to pay essential bills, rent, and utilities Suffered significant financial stress and uncertainty The financial and emotional toll of this ordeal has been devastating. This is an urgent matter. I can not continue to endure these financial hardships while Navy Federal continues to ignore my rights. I am requesting immediate action from the CFPB to ensure that Navy Federal complies with the law and resolves this issue.

Requested Resolution Given the serious violations outlined above, I am requesting that the CFPB compel Navy Federal Credit Union to follow the protections enforced by this agency and reimburse my funds immediately. I would also state that due to the extreme hardship this has caused me and my family retuning the stolen funds would be the bare minimum and not even begin to cover all that I have lost.

Navy Federals repeated violations of federal consumer protection laws are unacceptable. Their actions have harmed me financially and emotionally, and I am simply seeking the resolution I am legally entitled to under the law.

I respectfully request the CFPBs immediate intervention to hold Navy Federal accountable and ensure I receive the full relief I am owed.

Thank you for your time and attention to this matter. I trust that the CFPB will investigate these issues and enforce the necessary corrections to prevent further harm to me, my family and other Vets who have laid their life down for this country.

I acknowledge the request for transaction details and dates. I will attach an Excel sheet with the identified transactions ; however, the exact amounts and specific transaction details are maintained by Navy Federal. Unfortunately, I have been unable to obtain a copy of the disputed transactions. I am willing to provide any additional information I have, should it be required. Below are the case numbers provided by XXXX XXXX : - XXXX - XXXX - XXXX - XXXX - XXXX - XXXX - XXXX - XXXX

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