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Attorney General Josh Stein Fights to Protect North Carolinians from Overdraft Fees

For Immediate Release:
Thursday, August 17, 2023

Contact: Nazneen Ahmed
919-716-0060

(RALEIGH) Attorney General Josh Stein urged the North Carolina Supreme Court to prevent a credit union from unilaterally changing a North Carolinian’s contract so she couldn’t sue when they charged overdraft fees. In a friend-of-the-court brief filed in Canteen v. Charlotte Metro Credit Union with the North Carolina Supreme Court, Attorney General Stein argues that the credit union should not be allowed to change its contract with a customer by adding new and unexpected contract terms to gain a legal and financial advantage.

“Every dollar matters for North Carolinians working to pay bills and provide for their families,” said Attorney General Josh Stein. “This person alleges that her credit union unfairly charged her extra fees. She deserves to have her case heard in court; companies cannot unilaterally change their contracts to strip their customers of their substantive rights.”

In this case, Pamela Phillips, a customer with Charlotte Metro Credit Union, sued the credit union for charging unauthorized overdraft fees on her account. The credit union tried to block the lawsuit from being heard in court by adding two new pages of terms to its original contract with Phillips. The credit union argued that those new terms required her to arbitrate her claims to privately resolve them instead of allowing a court to hear the case.

Attorney General Stein argues that the law limits the credit union’s ability to change a contract with a customer after a customer accepts the original contract and that the credit union exceeded those limits in this case.  As a result, Attorney General Stein argues that the customer’s claims about being charged unauthorized overdraft fees should be heard in court.

A copy of the brief is available here.

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