Credit union trade associations are praising legislation introduced Tuesday by House Financial Services Committee members Rep. Blaine Luetkemeyer (R-Mo.) and David Scott (D-Ga.) that would protect credit unions from frivolous lawsuits that occur when required physical fee disclosures are removed from ATMs.
Regulation E requires ATM operators to provide two separate fee notices to consumers: electronic and physical. If a physical placard is not attached to the ATM, class action plaintiffs can recover huge settlements plus attorneys' fees and costs.
As a result, some have removed the physical placard and sued the ATM operator for noncompliance, or sued when the placard disclosure didn't match the charged fee.
The threat of lawsuits has caused many credit unions to go to extraordinary steps to document compliance, increasing the cost of operating ATMs to the detriment of credit unions' member-owners, said CUNA President/CEO Bill Cheney.
“This legislation will protect credit unions and other ATM operators from frivolous lawsuits while at the same time maintaining important consumer protections,” Cheney said. “This is a common sense piece of legislation that will reduce regulatory burden without harming ATM users.”
NAFCU President/CEO Fred Becker said repealing the dual signage provision will help consumers by putting a stop to baseless lawsuits that ultimately result in higher costs and less convenience due to increased fees and fewer ATMs.
Complete your profile to continue reading and get FREE access to CUTimes.com, part of your ALM digital membership.
Your access to unlimited CUTimes.com content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Breaking credit union news and analysis, on-site and via our newsletters and custom alerts
- Weekly Shared Accounts podcast featuring exclusive interviews with industry leaders
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the commercial real estate and financial advisory markets on our other ALM sites, GlobeSt.com and ThinkAdvisor.com
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
