iQ Credit Union $1M Overdraft & NSF Fee Class Action Settlement

Current and former account holders who were charged certain overdraft fees or NSF fees by iQ Credit Union between Dec. 12, 2018 and July 31, 2023, may be eligible to receive a cash payment or account credit from a class action settlement.

iQ Credit Union has agreed to pay over $1 million in cash and waived fees to settle a class action lawsuit alleging the credit union improperly charged overdraft fees on signature-based debit card transactions and non-sufficient funds fees on multiple presentments of the same item.

Who are the class members?

Class members must meet the following criteria:

• They are a current or former account holder who was charged at least one of the following fees by iQ Credit Union between Dec. 12, 2018 and July 31, 2023:
• An overdraft fee on a signature-based debit card transaction that was authorized when their account had sufficient funds and settled in the authorized amount, referred to as APSN fees
• A non-sufficient funds fee on the second or third presentment of an item that had previously been returned for insufficient funds, referred to as retry fees

• They received a postcard or email notice of the settlement.

How much are settlement payments?

• Pro rata cash payment: Eligible class members will receive a pro rata cash payment from the net settlement fund. The payment amount will be determined by the amount of qualifying fees paid.
• Debt forgiveness: Former account holders who were assessed qualifying fees that were not paid when their account was closed will no longer owe the fees. iQ will forgive a total of $58,947 qualifying fees.
• Cease future fees: iQ Credit Union has agreed to cease the assessment of qualifying ASPN and retry fees for no less than three years from the settlement final approval date. This benefit to the class has an estimated value of $195,000

No claim form required

Class members do not need to submit a claim form to receive a settlement payment.

Payout options

• Current account holders will receive a credit to their iQ Credit Union account
• Former account holders will receive a check mailed to their last known address

Settlement fund breakdown

The settlement fund will include

• Settlement administration costs: To be determined
• Attorneys’ fees: Up to $334,649 plus reimbursement of expenses
• Service award to class representative: Up to $5,000
• Payments to eligible class members: Remainder of $750,000 cash settlement fund
• Debt forgiveness: $58,947
• Fee practice changes for at least three years: Valued at $195,000

Important dates

• Exclusion deadline: Aug. 19, 2026
• Final approval hearing: Sept. 25, 2026

When is the iQ Credit Union overdraft fee settlement payout date?

Payments, account credits and debt forgiveness will be issued to eligible class members within 65 days of the final approval date.

Why was there a class action settlement?

This class action lawsuit was filed because iQ Credit Union was accused of improperly charging overdraft fees on certain debit card transactions and non-sufficient funds fees on multiple presentments of the same item. The plaintiff alleged these practices violated account agreements and state law.

iQ Credit Union denies the allegations, however agreed to settle to avoid the cost and uncertainty of continued litigation and a possible trial.

Sources

1. Class notice
2. Settlement website FAQ page
3. Settlement agreement