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My main credit union (Credit Union A) recently upgraded their ACH software. I have a car loan with Credit Union B.

Every month for over a year, the car loan payment has debited from my savings account, which is exactly what I've requested.

Yesterday my loan payment was debited from my checking account. Prior to the payment being finalized, the pending transaction for this payment was showing in my saving account as desired.

I contacted Credit Union A who provided a screenshot that confirms the ACH request contains the savings account number. Credit Union A claims that Credit Union B is using the incorrect ACH label, they state it should be labeled a "savings payment" (it was labeled a "demand payment") and have stated they will continue to pull the funds from the account the label specifies (vs the account number). Credit Union A suggested I contact Credit Union B to make them use the proper label, credit union B confirmed the account number and said its listed as a savings payment.

Is it legal for Credit Union A to debit my checking account, when I've specified I want this payment to come from my savings account?

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    Is your CU member number at A part of the account numbers? At my credit union my checking account number is <member #>1 and my savings is <member #>2. This could have added to the confusion if you only provided B with your member # and not the last digit.
    – Nosjack
    Sep 26, 2023 at 16:58
  • yes, same scheme. Credit Union B has only ever been provided the full savings account number. CU A confirmed they were using the full Savings account number on the ACH request.
    – rogerdeuce
    Sep 26, 2023 at 16:59
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    Have you marked it as "checking" at B? If so, A may be following that. Account numbers are pretty meaningless in credit unions, it's all membership numbers + account types. What do you mean "Credit Union B laughed"? Why would they not agree to label it correctly?
    – littleadv
    Sep 26, 2023 at 17:17
  • CU B has only ever been given permission to use the savings account. This was given in writing. CU B laughed and stated the account number is what determines which account to use, not the label. They do not plan to update the way they label their payment requests.
    – rogerdeuce
    Sep 26, 2023 at 17:20
  • @rogerdeuce I suggest you ask CU B again. Any time I give someone an ACH permission, I need to state whether it's a checking or a savings account. If you incorrectly told them that the account in A is checking - they should have a way to correct that. If they keep laughing ask to escalate to someone more knowledgeable.
    – littleadv
    Sep 26, 2023 at 17:24

3 Answers 3

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I can't really speak to the legality of this, but the Transaction Code (02-03) is a required field as part of the ACH request. If you confirmed with B that the request had the correct account number and type (savings), then it sounds like a computer glitch on the backend, most likely with A.

Have you ever made a payment from your Checking at A to an account at B? Usually ACH requires account verification through micro-deposits or a service like Plaid. I would be (only mildly) concerned if you have never verified your Checking account with B yet the payment was still pulled from there.

In this case, the best course of action is to delete the recurring payment with B and recreate it. Hopefully that refreshes something on the backend and this won't happen again.

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  • I have never made a payment (physical or electronic) from my checking account to CU B, aside from this incident.
    – rogerdeuce
    Sep 27, 2023 at 15:04
  • @rogerdeuce Really sounds like one of the CU is having a problem in their system. Either A is "pushing" payments from the ACH instead of letting B "pull", or B is actually sending the wrong Transaction Code in their "pull". Maybe call again and hope to get ahold of a different representative from each? Support people sometimes aren't the best at troubleshooting.
    – Nosjack
    Sep 27, 2023 at 20:48
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    confirmation came today that CU A has a bug and will be fixing their system.
    – rogerdeuce
    Sep 28, 2023 at 20:14
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It would certainly be legal for CU A to decline the ACH because there is no account of the specified type with the specified account number. Presumably, you would not be happy if your payment failed to post at all and CU B applied late fees and reported missed payments to the credit bureaus. So CU A is trying to do you a favor by resolving the mismatch and making the payment.

They happen to be resolving the mismatch by prioritizing one attribute of the request over another. It is very unlikely that someone bothered to codify into law "in case you receive an incorrect ACH request, you are legally required to honor attribute A over attribute B". You could certainly speak with a lawyer if you are really concerned about legality. If you are really just interested in having the payment come from the account you want it to come from, you'd need to tell CU B to send the correct request. That may require re-creating the ACH with the correct account type specified.

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  • It's slightly more complex than "attribute A over attribute B" if one of the pieces is not its own attribute, but part of the account number. Obviously they aren't discarding the entire account number in favor of the account type attribute.
    – Ben Voigt
    Sep 27, 2023 at 16:46
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    @BenVoigt - True. But CU A is still in a position of trying to figure out how to reconcile to incompatible attributes of the request and trying to do their best to discern the intention. Potentially, they were resolving the discrepancy one way for a while, something changed on their back end, and now they resolve it a different way. I doubt either approach violates a law. Sep 27, 2023 at 17:10
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You're asking "whether this is legal" - that's a question for a lawyer in your home jurisdiction, not a random anonymous web forum.

As to how things work - CU identifies you by your membership number and account type. It is very likely that internally that's all they know about you - member X, checking acct #1, #2, savings acct #1, #2, and so on. I've seen that with my own credit union - the account type is just a prefix/postfix to the membership number + running number per type.

When the ACH request comes, it says "take $X from checking acct Y". The CU then goes through your list of checking accounts, finds the (only?) one you have, and takes the money from there.

So far it sounds to me as working as intended. If you wanted to take the money out of your savings account - tell the bank B to send an ACH request that says "take $X from savings acct Y". The selection between checking and savings should be at the account linking page/payment settings page.

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  • I don't understand how this relates to the question. The following details are included up there: There are 2 separate account numbers, and CU A has confirmed that CU B is using the account number associated with the savings account.
    – rogerdeuce
    Sep 26, 2023 at 18:30

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