On January 27, the U.S. District Court for the District of Maine granted in part and denied in part a credit union’s motion to dismiss in a case involving alleged violations of the Electronic Fund Transfer Act (EFTA), the Fair Credit Reporting Act (FCRA), and the Fair Credit Billing Act (FCBA). The dispute began after the plaintiff — a member of the credit union — claimed to have fallen victim to an overpayment scam in spring 2024. According to the court’s order, a fraudster persuaded the plaintiff to install remote access software and set up online banking, then transferred funds between her home equity line of credit, savings, and checking accounts. The plaintiff was later convinced to withdraw large sums of cash and deposit them into an ATM. After discovering the fraud, the plaintiff reported the unauthorized transactions.
The court considered three main claims. First, under the EFTA, the plaintiff alleged the credit union failed to investigate unauthorized electronic fund transfers and did not provisionally recredit her account. The court found the transfers were unauthorized under the EFTA but ruled the statute does not cover losses from the plaintiff’s own cash withdrawals and ATM deposits. The claim was allowed to proceed only on the issue of whether the credit union failed to recredit the account provisionally within ten business days, as required by the EFTA’s error resolution process. Second, the court dismissed the FCRA claim, finding no factual inaccuracy in credit reporting and determining the dispute instead concerned “legal questions” regarding who was responsible for the loss. Third, the court dismissed the FCBA claim, reasoning that the extensions of credit were made to the plaintiff’s own account in the correct amounts.
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