The lawmakers called the Oceanside-based credit union’s overdraft practices “unconscionable” and urged the company to change its fee policies.
In this Sept. 28, 2021 file photo, Sen. Elizabeth Warren, D-Mass., speaks during a Senate Armed Services Committee hearing on Capitol Hill in Washington.“Frontwave owes service members and the American public an explanation for its deeply exploitative overdraft practices that harm service members and their families,” the letter states.
Marines make up the majority of Frontwave’s members, and the credit union relies on overdraft fees as a key source of income. In 2022, the company collected about $8 million in overdraft penalties, according to data collected by the state The letter demanded answers in response to more than a dozen questions about the credit union’s reliance on overdraft fees for income, its enrollment of Marine recruits and the safeguards it affords customers.Frontwave CEO Bill Birnie declined an interview request. In an email, he said the company would respond to the lawmakers’ questions by their May 10 deadline.
“This letter is a big deal, and it's tough,” he added. “This is going to get some senior brass on the military side quite focused — I suspect that this exclusive arrangement doesn't have much longer to go.” In an email Thursday, the Marine Corps said it is working with recruiters to ensure recruits understand how to enroll in the bank of their choice when they enter boot camp.
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