Heritage Federal Credit Union Settlement: $635K

Current and former Heritage Federal Credit Union checking account holders who were charged one or more overdraft fees between Dec. 20, 2012 and April 8, 2025.

No documentation is required. Eligible members will be identified through credit union records and will receive payments automatically.

Heritage Federal Credit Union has agreed to pay $635,000 to settle a lawsuit claiming it charged members overdraft fees they shouldn't have owed.

The case alleged the credit union assessed fees even when accounts had enough money to cover transactions at the time they were made.

Heritage Federal Credit Union operates branches in Indiana and Kentucky, serving members in both states. The lawsuit took issue with how the credit union calculated and applied overdraft charges to checking accounts over more than a decade.

According to the complaint, the credit union charged overdraft fees in two questionable situations.

First, members said they were hit with fees on transactions that never actually caused their accounts to go negative.

Second, the lawsuit alleged that when members swiped their debit cards with sufficient funds available, they were still charged overdraft fees if the transaction later posted to a negative balance, even though the purchase was approved when the account had money in it.

These practices, plaintiffs argued, violated the terms of their account agreements and left members paying fees they didn't legitimately owe. For customers living paycheck to paycheck, unexpected overdraft charges can trigger a cascade of additional fees and financial hardship.

Heritage Federal Credit Union has not acknowledged any wrongdoing and maintains it acted appropriately. The credit union agreed to the settlement to resolve the dispute without further litigation.

How Payments Will Be Distributed

Members who qualify for this settlement don't need to do anything to receive their money. There's no claim form to fill out—the credit union will use its own records to identify who was charged overdraft fees during the eligibility period and calculate what each person is owed.

Payment amounts will vary based on how many fees you were charged. Those who racked up more overdraft charges over the years will receive a larger share of the settlement fund than those who were hit with just one or two fees.

How you get paid depends on your current status with the credit union. If you still have an active account, expect to see your payment show up as a credit. If you've closed your account or moved on to another financial institution, the settlement administrator will mail you a check.

The deadline to opt out or object to the settlement is Dec. 24, 2025. A final approval hearing is scheduled for March 6, 2026, after which payments will be distributed to eligible members.