Consumer complaint received 2025-03-18 00:00:00
Product: Checking or savings account — Checking account
Issue: Managing an account — Deposits and withdrawals
Company: NAVY FEDERAL CREDIT UNION
State: CO

Complaint narrative:
Dear Navy Federal Credit Union Funds Availability Department, I am writing to formally challenge the legality of the extended hold placed on my state tax refund check in the amount of {$14000.00}, which was deposited into my account at Navy Federal Credit Union ( NFCU ). Despite my deposit meeting the necessary criteria for next-business-day availability as outlined under Regulation CC ( 12 CFR Part 229, Expedited Funds Availability Act ), NFCU is going withheld my funds for five business days, only making {$250.00} available upon deposit. Furthermore, I was not provided with a written, detailed explanation outlining the specific reasoning for this hold, as required by federal regulations. Violation of Regulation CC Next-Day Availability for Government Checks Under Regulation CC, state and local government checks that are : Payable to the account holder ( which mine is ), and Deposited in person with a credit union employee ( not an ATM ) are required to be made available the next business day following the deposit. Additionally, according to the Expedited Funds Availability Act ( EFAA ), if a government check deposit exceeds {$5500.00}, the first {$5500.00} must be made available the next business day, while any remaining balance may be subject to an extended hold only if justified under specific circumstances. Given that my check is a state tax refund, it qualifies under this rule, meaning NFCU is legally obligated to release at least {$5500.00} of my funds by the next business day, which has not been done. Instead, only {$250.00} was made available, which does not comply with Regulation CC. Failure to Provide a Written Hold Notice with a Valid Justification As per 12 CFR 229.13 ( g ) of Regulation CC, if NFCU places a hold that extends beyond the standard availability timeframe, it is legally required to provide me with : A written notice that includes : The specific reason for the hold The exact date when the remaining funds will be available Information on how to dispute the hold This notice must be provided at the time of deposit or mailed by the next business day if the determination is made after the deposit. I was not given this written notice, which is a direct violation of federal banking regulations. If NFCU intends to justify this five-business-day hold, it must provide documentation showing why my deposit is classified under an exception hold category. Potential Unlawful Justifications for This Hold According to NFCUs Funds Availability Policy, a five-business-day hold may only apply if : The deposit was made at a nonproprietary ATM ( not owned by NFCU ) The check is deposited into a new account ( less than 30 days old ) There is a history of overdrafts, fraud, or returned checks The check deposit is deemed high-risk due to suspected fraud There is a national emergency or system failure Since none of these exceptions apply to my deposit, this extended hold appears to be an unjustified and arbitrary restriction on my funds. Immediate Action Requested I am formally requesting the following actions from NFCU : Immediate release of the required {$5500.00} from my deposit as per federal regulations. A detailed, written explanation of the exact legal grounds under which NFCU is holding my check for five business days. A confirmation that NFCU is in full compliance with Regulation CC and the Expedited Funds Availability Act regarding state tax refund checks. If these concerns are not resolved immediately, I will have no choice but to escalate this matter by : Filing a formal complaint with the Consumer Financial Protection Bureau ( CFPB ) Submitting a regulatory grievance to the National Credit Union Administration ( NCUA ) Seeking legal counsel to review whether NFCU is engaging in unlawful banking practices I expect an immediate response to this inquiry. If my funds are not released in accordance with Regulation CC, I will take further action. Please respond to this request in writing within 24 hours. Sincerely, XXXX XXXX XXXX

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