Recently, NCUA Board Member Debbie Matz, speaking to a meeting of the American Association of Credit Union Leagues, cautioned against offering “bounce protection programs through third parties which charge very high fees.” It has been my experience, as counsel for a large provider of these services, that the fees charged for bounce protection are set by the credit union and not the vendor. The member suffers no disadvantage regardless of whether the overdraft program was created and administered “in house” or through a vendor. The overdraft fees are, in fact, the same as the credit union’s fees for returning checks unpaid in order to maintain their exemption under Regulation Z, and meet other legal requirements. Richard S. Schulman Attorney Northampton, Mass. (Editor’s Note: Schulman offers legal services to overdraft protection firm BancServices Group, which is marketed to CUs by Allied Solutions.)

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