This section describes overdraft approval policies and processing requirements formalized by the Board of Directors of Integrity Federal Credit Union on April 28, 2011.
All employees of Integrity Federal Credit Union, herein referred to as the “Institution”, must comply with the terms of this policy immediately. Managers, employees and technical personnel must modify applicable system configurations and procedures, if necessary, to comply with the terms of this plan within 10 business days.
DEFINITIONS An “overdraft” is technically classified as an account in which the balance has been reduced to an amount below zero. This may occur by one of the following reasons:
- A debit presented for payment where the account does not have sufficient funds to pay the item
- A deposited item returned where the account does not have sufficient funds to absorb the charge back
- The establishment of an approved overdraft limit for a specified account group
POLICY STATEMENT Overdrafts are not an encouraged method for extending credit and, as such, should be strongly discouraged. The decision to grant an overdraft within established limits is automatic; exceptions to preassigned limit(s) should be clearly documented and approved by Senior Management.
A report of overdrawn accounts will be reviewed and monitored on a daily basis by a designated manager or overdraft coordinator.
STANDARD OVERDRAFT SERVICE The Board of Directors and Senior Management have established and approved the following standard overdraft service for all share draft accounts in good standing:
Institution will authorize and pay overdrafts up to the assigned overdraft limit for the following types of transactions, unless the member has chosen to opt-out:
- Share Drafts
- ACH transactions
- Recurring debit card transactions
Institution will NOT authorize and pay overdrafts for the following types of transactions, unless the member has chosen to opt-in:
- ATM transactions
- One-time debit card transactions
OVERDRAFT LIMITS The Board of Directors and Senior Management have established a limit of no more than $500.00 in overdraft balances per member. Exceptions to this policy will require approval by an authorized officer. Further, a cap of $500.00 in total dollar amount of all overdrafts (including fees) has been established which is consistent with the credit union’s ability to absorb losses. The credit union retains the right to return or discontinue payment of overdrafts at any time without prior notice to members.
The overdraft limit of $500.00 will be extended to all Share Draft Accounts in good standing according to the follow procedure:
- The overdraft limit will automatically be available beginning 60 days from account open date for share drafts, ACH, other debits and recurring debit card transactions unless the member has opted-out, the account is not in good standing or does not qualify based on other criteria.
- Effective August 15, 2010 for accounts opened prior to July 1, 2010 and new accounts opened on or after July 1, 2010, the member must consent or opt-in to having the overdraft limit activated for ATM and one-time debit card transactions. The member can opt-in by phone, on our website or by providing a signed opt-in agreement. Within one business day of receiving the opt-in request, the credit union will mail a written acknowledgement to the member confirming their election to opt-in and their ongoing right to revoke their opt-in status. The limit will be activated the same day the written acknowledgement is mailed.
ENFORCEMENT Changes to this policy require approval by the Board of Directors of the Institution. Changes in operating procedures, standards, guidelines and technologies, provided they are consistent with this policy and are compliant will all current financial regulations, may be authorized by an officer.
The Board of Directors has the authority to approve this policy, and annually approves the merit thereafter. Senior management is responsible for ensuring the directives are implemented and administered in compliance with the approved policy.
The primary responsibility for enforcement of this policy and its operating procedures rests with management and our employees.
No part of this policy or its supporting operating procedures should be interpreted as contravening or superseding any other legal and regulatory requirements placed upon the Institution. Protective measures should not impede other legally mandated processes such as records retention or subpoenas. Any conflicts should be submitted immediately to Senior Management for further evaluation and/or subsequent submission to the Institution’s legal counsel.
EXCEPTIONS TO POLICY Requests for exceptions to this policy must be very specific and may only be granted on specific items, rather than to entire sections. Institution personnel with exceptions are to communicate their requests by completing an internal memorandum to an officer for consideration by Senior Management.
APPROVAL PROCEDURES All Overdrafts are to be promptly reviewed by an officer before the daily deadline for returning the items which created the overdraft. An overdraft report and NSF item report will be created and initialed by the officer assigned to review and/or approve the overdrafts.
APPROVAL AUTHORITY Overdrafts that are not a result of a systematically approved overdraft limit will require approval within established credit authorities. To determine the necessary level of approval, refer to the Institution’s GENERAL LOAN POLICY for approved lending/overdraft limits.
COLLECTION OF OVERDRAFTS Collections of overdrafts will be primarily performed by mailing system generated collection letters based on consecutive days overdrawn as described below; until the overdraft is either paid or charged off:
- 15 day reminder letter
- 30 day suspension letter
- 45 day account closed and charged off
Collection efforts will also include telephone calls to the member when the account is overdrawn for 30 or more consecutive days.
Accounts that bring their balance positive between 30 and 45 days overdrawn will continue to have their overdraft limit suspended, pending approval of reinstatement by management.
Accounts overdrawn 45 consecutive days will be charged-off and reported or referred to ChexSystem.
PROGRAM REVIEW A review will be conducted by an officer, or their designee, on a periodic basis to determine not only staff compliance with this policy, but also to identify account holders who may be offered alternative means of handling their finances (i.e. – Line of Credit, Automatic Transfer from Other Account, Opt Out of the Program). This review shall be documented, along with correspondence to/from account holders resulting from the review.
OVERDRAFT AND RETURN ITEM CHARGES Overdraft and Return Item Charges shall be set at $31.00 with subsequent changes requiring prior board approval and a minimum 30 day notification to account holders prior to implementation. Refunds of these fees will require approval of an officer or supervisor after an initial “one time” courtesy refund and re-education of the consumer on the policies for overdrafts.
OVERDRAFT NOTICES TO ACCOUNT HOLDERS Account holders will be mailed at the earliest possible time a notice for each instance of overdraft or increase in overdraft. This notice will disclose the amount of the overdraft, the debit(s) which created the overdraft, the fee assessed for the overdraft and contact information should they desire to discuss the overdraft.
Additionally, a reminder notice will be mailed after 15 consecutive calendar days of overdraft. This notice shall note the date and amount of the overdraft outstanding, and remind the account holder of the time limit to resolve the overdraft.
RETENTION OF DOCUMENTATION Correspondence received from account holders, documentation of opt-ins to include any staff documentation of verbal correspondence, shall be maintained for a period of no less than three (3) years. This correspondence shall be logged and filed such that retrieval during examinations is accomplished with ease.
Retention of system generated overdraft reports shall be maintained in accordance with existing guidelines.
You are responsible for all transactions you authorize using your EFT services under this Agreement. If you permit someone else to use an EFT service, your Card or your access code, you are responsible for any transactions they authorize or conduct on any of your accounts. However, TELL US AT ONCE if you believe your Card and/or access code has been lost or stolen, if you believe someone has used your Card or access code or otherwise accessed your accounts without your permission, or if you believe that an electronic fund transfer has been made without your permission using information from your check. Telephoning is the best way of keeping your possible losses down. You could lose all the money in your account (plus your maximum overdraft line of credit).
You are not liable for an unauthorized MasterCard debit card transaction that was not conducted at an ATM if you can demonstrate that you exercised reasonable care in protecting your Card from loss or theft, you have not reported two (2) or more incidents of unauthorized use in the past twelve (12) months, and your account is in good standing.
Otherwise your liability for an unauthorized MasterCard debit card transaction that was not conducted at an ATM will be no more than $50.00.
For all other EFT transactions involving access devices, including transactions conducted at ATMs, your liability for unauthorized transactions is determined as follows. If you tell us within two (2) business days, you can lose no more than $50.00 if someone used your Card or code without your permission. If you do not tell us within two (2) business days after you learn of the loss or theft of your Card or code, and we can prove that we could have stopped someone from using your Card or code without your permission if you had told us, you could lose as much as $500.00.
Also, if your statement shows transfers that you did not make including those made by card, code or other means, TELL US AT ONCE. If you do not tell us within sixty (60) days after the statement was mailed to you, you may not get any money lost after the sixty (60) days if we can prove that we could have stopped someone from making the transfers if you had told us in time. If a good reason (such as a hospital stay) kept you from telling us, we will extend the time periods. If you believe you Card has been lost or stolen or that someone has transferred or may transfer money from your account without your permission, call:
Or write to: INTEGRITY FEDERAL CREDIT UNION
971 Wooster Rd W.
Barberton, OH 44203
(330) 825-4877 Fax
You should also call the number or write to the address listed above if you believe a transfer has been made using the information from your check without your permission.
In case of errors or questions about electronic funds transfers from your share and share draft accounts or if you need more information about a transfer on the statement or receipt, telephone us at the following number or send us a written notice to the following address as soon as you can. We must hear from you no later than sixty (60) days after we sent the first statement on which the problem appears.
Call us at:
Or write to:
INTEGRITY FEDERAL CREDIT UNION
971 Wooster Rd W.
Barberton, OH 44203
- Tell us your name and account number.
- Describe the electronic transfer you are unsure about, and explain as clearly as you can why you believe the Credit Union has made an error or why you need more information.
- Tell us the dollar amount of the suspected error.
If you tell us orally, we may require that you send us your complaint or question in writing within ten (10) business days.
We will determine whether an error has occurred within ten (10) * business days after we hear from you and will correct any error promptly. If we need more time, however, we may take up to forty-five (45) ** days to investigate your complaint or question. If we decide to do this, we will credit your account within ten (10)* business days for the amount you think is in error, so that you will have the money during the time it takes us to complete our investigation. If we ask you to put your complaint or question in writing and we do not receive it within ten (10) business days, we may not credit your account.
We will tell you the results within three (3) business days of completing our investigation. If we decide that there was no error, we will send you a written explanation. You may ask for copies of the documents that we used in our investigation.
*If you give notice of an error within thirty (30) days after you make the first deposit to your account, we will have twenty (20) business days instead of ten (10) business days.
**If you give notice of an error within thirty (30) days after you make the first deposit to your account, notice of an error involving a point of sale transaction, or notice of an error involving a transaction initiated outside the U.S. its possessions and territories, we will have ninety (90) days instead of forty-five (45) days to investigate.