Navy Federal Credit Union Class Action: Did They Secretly Record Your Calls?

Navy Federal Credit Union, the nation's largest credit union with over 13 million members, is facing a new class action lawsuit alleging it  allows artificial intelligence (AI) bots to monitor and record customer service calls without their consent.

Customer Conversations Captured Without Consent, Lawsuit Alleges

Avner Paulino, a Navy Federal member, filed the lawsuit on May 31, 2024, in a California federal court. The lawsuit names both Navy Federal and Verint, the AI company providing the call monitoring technology, as defendants.

Paulino alleges that he made multiple calls to Navy Federal's customer service line, disclosing sensitive personal and financial information during these conversations. He contends that Navy Federal deceived him by failing to disclose that their calls were being intercepted and analyzed by Verint's "Real-Time Agent Assist" software.

How AI Listens In and Analyzes Your Calls

Paulino alleges the credit union allows artificial intelligence (AI) bots to monitor and record customer service calls without their consent. The lawsuit details the inner workings of Verint's "Real-Time Agent Assist" software:

• Real-time monitoring: The software listens to customer conversations with call center agents as they happen.
  
  
• Speech-to-text transcription: Verint Da Vinci, the underlying technology, transcribes conversations in real-time.
  
  
• Emotion detection: The AI analyzes the tone, pitch, and pace of customer speech to determine their emotional state.
  
  
• Call center agent assistance: Based on its analysis, the AI suggests actions and talking points for call center agents to address the customer's perceived emotions.

According to the complaint, this practice violates California privacy laws by failing to obtain explicit consent from customers before monitoring their calls. It further raises concerns about how Verint might be using the collected data:

• Product development: The lawsuit alleges Verint may be using customer conversations to improve and develop its AI models and speech analytics products.
  
  
• Profit motive: The lawsuit suggests Verint may be using the data for its own financial gain by developing and selling more customer call monitoring and analysis products.

Not a First for Navy Federal Credit Union

This lawsuit isn't the first time Navy Federal has faced legal action in 2024. Earlier this year, the credit union agreed to pay $5.5 million to resolve a separate class action lawsuit concerning deceptive International Service Assessment (ISA) fees.

That lawsuit alleged Navy Federal charged customers a 1% ISA fee for debit card purchases made online from overseas merchants, even when the customer was physically located in the U.S. at the time of the transaction.

Paulino seeks to represent all California residents whose calls to Navy Federal were monitored by Verint's technology without their consent. The lawsuit seeks certification as a class action, financial compensation for damages, legal fees, and a jury trial. Additionally, it seeks to compel Navy Federal to implement stricter data privacy practices and obtain explicit consent from customers before monitoring their calls.

Case Details

• Lawsuit: Avner Paulino v. Navy Federal Credit Union et al
• Case Number: 3:24-cv-03298
• Court: U.S. District Court for the Northern District of California

Plaintiffs' Attorneys

•  Stephen Andrews and Christian Cho (Dovel & Luner LLP)