Consumer complaint received 2025-02-28 00:00:00
Product: Checking or savings account — Checking account
Issue: Problem caused by your funds being low — Overdrafts and overdraft fees
Company: NAVY FEDERAL CREDIT UNION
State: MD

Complaint narrative:
I am writing regarding the mishandling of an ACH and POS transaction by Navy Federal, which caused my account to become overdrawn. I joined Navy Federal in the beginning of XXXX and was not eligible for overdraft protection, as Navy Federals rules require a member to be with the bank for XXXX XXXXs before they can opt into overdraft protection. 

Despite this, Navy Federal mishandled both the ACH and POS transactions, which I believe is a violation of Regulation E, NACHA, and CFPB rules. 

ACH Payment for XXXX : XX/XX/year> : I called Navy Federal regarding an ACH payment for rent. I was informed that if there were insufficient funds, the transaction would be rejected. 

XX/XX/year> : I called again and Navy Federal told me that they rejected the ACH payment. I explicitly asked if the payment would be retried, and the representative assured me that it would not be. However, when I later withdrew the funds using my card to make the payment, my account became overdrawn because Navy Federal decided to recycle the ACH transaction. They allowed me to pull the funds through a POS transaction, even though my account was not in good standing, and I was not enrolled in overdraft protection. 

Unauthorized Dispute : XX/XX/year> : I called Navy Federal again, explicitly stating multiple times that I did not want to file a dispute. I called to request a credit to my account due to the illegal actions from the bank. However, a representative still initiated a dispute without my consent. He also falsely claimed that the merchant had not received the funds, which I never said. The representative told me the claim was auto-approved and that it was too late to cancel. I then spoke to a supervisor, who informed me I would hear from case management within XXXX hours. It has now been past the deadline, and I have not received any resolution. 

Key Issues : POS Transaction and ACH Retry Processed While Account Was Not in Good Standing : Navy Federal violated its own overdraft rules by allowing the POS transaction to go through even though I was not enrolled in overdraft protection and my account was not in good standing. Then provided misinformation by saying they wouldn't reprocess the ACH payment, only for it to be recycled later. 

Unauthorized and Fraudulent Dispute : Navy Federal illegally initiated a dispute without my consent, which I did not authorize, and falsely claimed that the merchant had not been paid. 

I have XXXX representatives involved on voice recordings : XXXX stating the ACH payment was rejected and wouldnt be retried. The other apologizing for initiating the dispute and acknowledging that it was done without my consent. Another XXXX saying the ACH transaction was initiated/posted before the POS transaction, giving me timestamps for the POS transaction, and other information that further supports my case regarding the improper handling of the transactions and the overdraft. 

I wanted to get this fixed as soon as possible to avoid ongoing issues with my XXXX XXXX, now that they have illegally pulled back the funds from my XXXX XXXX. Neither I nor the merchant should be responsible for the consequences of Navy Federals mistake. I've explained the urgency of this situation and still have not had these problems resolved.

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