The Top Four Credit Union Member Complaints in 2025

Complaint trends are one of the clearest windows into compliance risk.  

They expose control weaknesses, show where corrective action is needed, and reflect the strength of a compliance management system (CMS).  

Many credit unions lack the resources to spot meaningful complaint trends. Instead, they address isolated issues for individual members without seeing whether they are part of a broader pattern. 

Limited visibility into industry-wide data makes this problem worse. NCUA doesn’t share complaint information in a way that helps peer institutions spot risks or proactively review their own processes. Other federal regulators, such as the FDIC and Federal Reserve, publish complaint trends, but their reports come too slowly. The CFPB provides near-real-time complaint data with analytics, but they skew heavily to large lenders, making it hard to identify emerging risks and issues in products and services relevant to community-sized credit unions.

Without timely industry-wide data, credit unions risk missing early warning signs of emerging issues. Ncontracts’ analysis of recent complaint patterns sheds light on four critical regulatory areas, offering insight to strengthen compliance programs and reinforce member trust. 

These regulations frequently appear in member complaints, highlighting risks that demand proactive attention. Let’s take a closer look at these compliance challenges, their root causes, and practical steps credit unions can consider.  

Related: Transform your FI's complaint management — detect regulatory issues, track emerging trends, and mitigate risks early with complaint management software. Learn more.

Table of Contents

• Regulation V (Fair Credit Reporting Act) 
• Regulation B (Equal Credit Opportunity Act) 
• Regulation Z (Truth in Lending Act) 
• Regulation E (Electronic Fund Transfers Act)   
• Looking Ahead: Proactive Compliance in 2026  

1. Regulation V (Fair Credit Reporting Act) – Credit Reporting Errors and Disputes  

A credit score is one of the most influential factors in a person’s financial life — unlocking opportunities or limiting access to credit, housing, and even employment. Credit reporting errors are the leading source of member complaints at credit unions of all sizes. With fraud on the rise and more companies offering free credit report access, consumers are spotting errors more quickly and turning to their credit unions to resolve them. 

• Inaccurate credit reporting affecting member loan approvals 
• Difficulty in disputing or correcting credit report errors 
• Unauthorized credit inquiries damaging member credit scores  

• Lack of procedures for handling and centralizing credit disputes 
• System error adding polluted or outdated credit data  
• Lack of understanding of when the CU is allowed to pull credit at various credit stages 

• Implement automated dispute workflows to ensure timely resolutions  
• Regularly test credit reporting practices and systems to align with FCRA standards  
• Provide clear guidance and training to staff involved with pulling credit (from solicitations to line increases) 

What's the risk of getting it wrong?

FCRA generally requires that a furnisher (i.e., a credit union) not furnish inaccurate consumer information to a credit reporting agency (i.e., Equifax, TransUnion) and that furnishers investigate a consumer's dispute that the information is incorrect or incomplete. In addition, CUs are expected to have a permissible purpose before pulling credit. The prudential banking regulators, the CFPB, and state attorney generals have supervisory or enforcement authority, and private plaintiffs have the right to file lawsuits. Having reasonable procedures and processes is essential to ensure credit unions provide accurate data, promptly correct it when they get it wrong, and avoid pulling credit without a permissible purpose. 

2. Regulation B (Equal Credit Opportunity Act) – Loan Denials and Discriminatory Lending Practices

Discrimination is a loaded word in banking. Numerous laws and regulations protect consumers at every stage of lending, and even unintended missteps can land credit unions in headlines, lawsuits, settlements, or enforcement actions—damaging their reputations in the communities they serve. 

Members often question the reasons behind loan denials and depend on accurate reasons for denial to improve their future chances of obtaining credit or dispute incorrect information. While a single complaint may be an isolated case, patterns of fairness-related complaints can point to deeper concerns about discrimination. Analysis of credit union complaint data shows that lending practices are a frequent source of member complaints. 

Key Complaint Issues

• Members experiencing vague reasons for denial in the adverse action notice 
• Perceived discrimination in lending decisions  

Root Causes

• Policies allowing discretion in the lending process 
• System failures when producing an adverse action notice 
• Job-specific Fair Lending and Regulation B training deficiencies  

Mitigation Strategies

• Standardize underwriting criteria and ensure transparency in loan decisions
• Identify, review, and understand disparities in loan data 
• Conduct regular lending disclosure audits to identify and resolve potential issues
• Train staff on Reg B requirements (such as specific denial codes) and Fair Lending 

What's the risk of getting it wrong?

The Equal Credit Opportunity Act and its implementing regulation, Reg B, provide a "private right of action," meaning that an aggrieved applicant can sue a creditor directly if they believe their credit union denied their loan based on a prohibited factor. Furthermore, Regulation B is more than just a statement on anti-discrimination; it is also a rule that mandates disclosures when prospects are not given the loan terms requested or are denied a loan, also known as an adverse action notice. Credit unions can face findings, fines, and penalties for violating Regulation B when they fail to provide accurate denial reasons.   

Related: 7 Fair Lending Risks Every Financial Institution Needs to Know

3. Regulation Z (Truth in Lending Act) – Loan Disclosures and Billing Errors  

Consumer lending is among the highest-risk areas for consumer protection violations. Credit unions must navigate dozens of federal and state laws — and thousands of individual requirements — when offering credit and servicing loans. It’s no surprise, then, that lending issues rank as the third most common source of complaints, particularly around consumer credit cards and residential mortgages. 

Many credit unions pride themselves on precise underwriting, but that doesn’t always mean members leave with a clear understanding of their obligations. Complaints often cite unexpected differences between loan estimates and closing disclosures for costs or payments, as well as frustrations with third parties involved in billing disputes. 

Key Complaint Issues

• Misunderstandings regarding loan terms and fees 
• Billing disputes and unclear payment obligations 
• Unexpected changes in interest rates or repayment structures  

Root Causes

• Inaccurate loan disclosures 
• Inconsistent fee structures and communication 
• Failure to promptly correct billing disputes  

Mitigation Strategies

• Ensure loan disclosures are clear, concise, and easy to understand  
• Regularly review loan disclosures to ensure compliance with TILA  
• Review loan fees and agreements for clear language and consistency 
• Actively monitor third parties involved in billing dispute resolution  

What's the risk of getting it wrong?

Misunderstandings, lack of accurate disclosures, and not promptly correcting mistakes identified by a member can lead to enforcement actions and trigger mandatory fee reimbursements that can affect the credit union's bottom line.  

Meanwhile, most members don’t distinguish between a credit union and its third parties, so poor vendor performance — especially around billing errors — can damage the credit union’s reputation and draw regulatory scrutiny. 

Related: What is Vendor Management? Processes, Best Practices, and Challenges

4. Regulation E (Electronic Fund Transfers Act) - Unauthorized Transactions and Excessive Fees

Regulation E covers a range of account issues, from debit card fraud to overdraft fees, and both areas saw an increase in member complaints last year. Credit unions are facing unprecedented levels of fraud, while members expect quick, low-friction resolutions. Efforts to limit fraud losses have, at times, led credit unions to delay investigations by requesting extra documentation or by not providing timely provisional and final credits. 

Regulators have increasingly focused on account fees in recent years, issuing dozens of enforcement actions against institutions for charging authorized positive, settled negative (APSN) overdrafts. This scrutiny has pushed several national banks to announce the elimination of overdraft fees altogether. More credit union members are questioning the fairness of account charges. 

Key Complaint Issues

• Member disputes over unauthorized debit card transactions 
• Delays in resolving fraud claims 
• Unclear or excessive overdraft fees  
  

Root Causes

• Inadequate fraud detection and monitoring systems 
• Training and process deficiencies regarding Reg E error resolution requirements 
• Lack of system functionality to prevent APSN and excessive overdrafts  

Mitigation Strategies

• Test fraud rules to ensure appropriate prevention and enhance real-time transaction monitoring 
• Straightforward and streamlined dispute resolution processes to ensure prompt member reimbursement and communication 
• Eliminate APSN overdraft fees and implement fee limits 
• Review all fees to ensure they are competitive and transparent  

What's the risk of getting it wrong?

Members who experience fraud and fail to recover their funds through their credit union often turn to the courts, fueling a wave of class action lawsuits. Overdraft practices have also sparked litigation and multimillion-dollar UDAAP enforcements. And while the CFPB may be quieter, state attorneys general continue to target what they see as excessive or misleading account fee practices. 

Looking ahead: Proactive compliance in 2026

As credit unions navigate an evolving regulatory landscape, proactively addressing heightened risk areas is critical to protecting member trust and ensuring compliance. Leadership changes at the CFPB and other federal agencies do not signal a free pass. Regulators at every level continue to monitor for consumer protection risks.  

Deregulation never means no regulation.  

Complaint data provides valuable, data-driven insight into systemic issues that, if ignored, can lead to reputational harm, financial penalties, and heightened scrutiny. By prioritizing compliance with key regulations — Regs V, B, Z, and E — and logging and analyzing complaints to uncover trends, credit unions can reduce consumer harm while strengthening member satisfaction. Leveraging technology to prevent errors, investing in targeted employee training, monitoring third parties, and promoting transparency all contribute to a stronger compliance management system (CMS). 

Ultimately, a proactive approach to compliance is not just about meeting regulatory expectations — it’s about protecting member relationships, ensuring resilience, and positioning credit unions as trusted partners in their communities. In 2026 and beyond, the credit unions that thrive will be those that treat compliance as a strategic advantage, fueling both growth and long-term sustainability.

Learn more about complaint management software and join our webinar to discover the top compliance risks facing credit unions and other FIs.