Overdraft compliance that tests every fee against the balance the member had when they paid, with a named person signing every finding and refund
Every overdraft and NSF fee tested, not a sample, and refunds sized before the exam.
See one case, screen by screen ↓Overdraft compliance is the testing a credit union's or bank's compliance team does to show that courtesy pay and NSF fees are charged fairly, as disclosed and with the consent Regulation E requires. Overdraft Compliance replays 12 months of posting for every member, tests every fee for authorize positive, settle negative (APSN), repeat fees on re-presented items and opt-in consent, and sizes the refund. The Compliance Officer approves each finding, and a second person checks every refund plan.
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Overdraft compliance starts with how each courtesy pay and NSF fee was decided: by the core's posting engine, often on settings left at the vendor's default, and each fee can become a refund. A member buys groceries on Saturday with $61.40 available; on Monday a car payment posts first, and when the purchase settles that night a $29.00 fee is charged on money the member had. A merchant re-presents a returned ACH debit as RETRY PYMT, and each return charges another NSF fee. A phone opt-in taken before the notice was sent leaves every ATM and one-time debit card fee without a valid Reg E opt-in.
Compliance tests this today with a sample of 25 to 60 accounts a quarter: a report request to Deposit Operations, a card processor extract matched to settlements in a spreadsheet, re-presented items found by eye, and the core's opt-in flag trusted instead of the record behind it. A sample finds the pattern but never the population. The refund is rebuilt by hand, the core setting is changed without a record of why, and the examiner asks for the look-back anyway.
Estimated split for one quarterly test of courtesy pay and NSF fees at a credit union the size of the sample one, by hand on a sample of accounts and with the agents on every fee. Our estimate, kept modest.
Eight agents replay every member's balance, test every fee and size the refund; a Compliance Officer approves, a second person checks.
Overdraft compliance at Norrell Federal Credit Union, a fictional $6.8 billion credit union with 520,000 members and about 41,000 courtesy pay and NSF fees a month. Here is Renée Castellanos's Wednesday, October 21, 2026, screen by screen, in the working solution.
Overnight the agents replayed 12 months of posting for all 410,284 checking accounts and tested every one of 492,316 courtesy pay and NSF fees; 7,664 failed a test. Five items need a person, each with its clock: finding F-2026-031 with 9 business days left, refund plan RP-2026-07, practice change PC-2026-04, two held items past their SLA and member notice NT-2026-07. The core posting file for October 20 has not arrived, and the home screen says so, with Retry now.
“Nightly watch of repeat fees on re-presented items: 0, 0 since the change on October 19.”
Run TR-2026-1021 read 61.8 million transactions and 214 fee settings, then ran eight tests on every fee from October 20, 2025 to October 19, 2026, each with the rules behind it. Authorized positive, settled negative: 4,920 fees, 3,912 members, $142,680.00, waiting for approval. Repeat fees on re-presented items, opt-in consent and the daily fee cap are approved findings; three tests passed.
Settlement test agent: 96 fees held for a person because an authorization file is missing.
Account ending 4417, Keisha Monroe, September 30 to October 6, 2026, drawn as two lines: available balance and ledger balance. Her $38.12 purchase at Brightwater Grocery on Saturday at 5:48 PM was authorized with $61.40 available. On Monday a $250.00 ACH debit to Fairmont Auto Finance posted first, so when the purchase settled that night the account was negative and a $29.00 courtesy pay fee was charged.
“Authorized positive, settled negative: covered by $61.40 when authorized on Saturday.”
The fee on the car payment is labeled “Allowed: the ACH debit itself overdrew the account”, so the refund is targeted, not blanket. A second member, account ending 6052, bought $91.33 at Sunrise Market with $729.50 available; rent check 2210 for $725.00 cleared first. An ACH debit posted first in 61% of these fees, a check in 22% and another card settlement in 17%.
“The same pattern hit 3,912 members: 4,920 fees, $142,680.00 in 12 months.”
Finding F-2026-031, drafted by Marcus Bell, says why it happened: the core decides card and ATM fees at settlement, the vendor default, and section 14 of the member agreement says so. It cites the unfairness test, FDIC FIL-19-2023 and the NCUA's January 2025 letter on overdraft and NSF fee practices, shows confidence 0.97 against a 0.90 threshold, and lists what the agents set aside, such as 1,204 card transactions on February 11–12, 2026 with no authorization file. Renée approves with FA-01, Pattern confirmed by the replay and the rule.
“Marcus Bell prepared this finding. You may approve it; he may not.”
The Refund agent adds the 3,912 members to refund plan RP-2026-07, which grows to 5,307 members, 7,664 fees and $222,256.00 across four findings; 436 members in more than one finding are counted once. It splits how members are paid (5,005 credits, 288 official checks, 14 estates) and drafts the general ledger entries. Renée sends the plan; Priya Raman verifies a sample of members against their replays and approves as checker with RA-01.
The Refund agent never posts a refund: two signatures first.
The Configuration agent read the fee settings of the core banking system and the card processor and names the one behind the finding: the courtesy pay fee basis for card and ATM items is SETTLEMENT, the vendor default since the 2024 conversion. Practice change PC-2026-04 moves it to AUTHORIZATION from November 2, 2026. The what-if replay shows about 410 fewer fees a month and $11,890 a month less fee income, estimated, before Priya approves with PA-01.
“Renée Castellanos proposed it. You approve it as checker.”
The Notice agent drafts a notice for each of the 5,307 members in the language on file: 611 in Spanish, 345 by mail and 18 in large print. Keisha's says the credit union charged a $29.00 fee for a purchase her balance covered when she made it, and refunds it on or before November 6, 2026. Only Jordan approves the wording, and nothing is sent before the refund plan is checked.
Never in a member notice: a finding number, a rule or the word “violation”.
For the NCUA exam on January 11, 2027, the agents build nine sections from the record: the fee testing program and its 8 tests, findings F-2026-027 to F-2026-031, 40 replays, the refund plan, 4 practice changes, 188,412 consent records tested, 5 promises compared, the audit trail and the governance of 8 agents. Member names are masked, account numbers show their last four digits, and any suspicious activity report or case is always left out.
“I need who decided, why, on what evidence, in one pack.”
The same finding, seen by the five people who carry it from the replay to the exam: what their quarter looked like, and what it looks like now.
Eight agents replay every member's balance, test every fee and size the refund; a Compliance Officer approves, a second person checks.
Rebuilds every member's available and ledger balance, minute by minute, for 12 months, in the order items posted, from posting history, card authorizations and ACH returns.
Tests each card and ATM courtesy pay fee: was the available balance enough when the member authorized the item? Names the item that posted in between.
Links every re-presented ACH debit (RETRY PYMT, same originator and amount, within 180 days) and every re-deposited check to its first return, and tests repeat NSF and courtesy pay fees.
Opens the Regulation E opt-in record behind every ATM and one-time debit card fee: the notice, the opportunity, the consent and the written confirmation, in that order.
Turns each promise in the fee schedule, the member agreement and the Truth in Savings disclosures into a test on the replayed postings, and reads ATM receipts and app balances.
Reads the fee settings of the core banking system and the card processor every night, names the setting behind each finding, and replays 12 months under a proposed change.
Sizes the refund across approved findings, removes overlaps and fees already refunded, splits credits, checks and estates, and drafts the general ledger entries.
Drafts a short notice for every member in the refund plan, in English or Spanish as on file: the amount, the dates and what changed.
Approves every finding with a reason. The agents propose; a named person decides.
Ask about any fee, member, finding, setting or rule, or say what to draft. Every answer cites its record and opens the screen it is about.
Why is the fee on account ending 4417 a problem?
Keisha Monroe bought groceries for $38.12 on Saturday, October 3, with $61.40 available. On Monday a $250.00 ACH car payment posted first, so when the purchase settled that night the account was negative and a $29.00 fee was charged. The FDIC calls this authorize positive, settle negative. The fee on the ACH itself stays. The same pattern hit 3,912 members.
Which core setting caused the repeat NSF fees?
NSF_FEE_ON_REPRESENTED_ITEM = CHARGE, the vendor default. Examiners have found exactly that default unfair. The change went live on October 19, and the nightly watch shows 0 repeat fees since.
How big is the refund with a 24-month look-back?
With all four findings and 24 months: an estimated 7,018 members, 9,684 fees and $280,836.00, against 5,307 members and $222,256.00 for 12 months. It needs the card processor's archive for the older authorizations, which has been requested. The plan stays at 12 months until the Supervisory Committee decides.
Draft the Supervisory Committee summary
Drafted for November 18, two pages: what we tested (492,316 fees), what we found (four practices, 7,664 fees, $222,256.00), what we did (one refund plan, three settings changed, a nightly watch) and one decision for the committee: the look-back. Renée Castellanos signs before it goes.
13 screens from the working solution, on its sample data. Pick one to see it large.
The tests, thresholds, approvers and clocks are settings. A change by the administrator waits for the Compliance Officer, and every version is on the audit trail.
| Setting | Default | Choose from |
|---|---|---|
| Findings are approved by | VP & Compliance Officer | VP & Compliance Officer · Chief Risk Officer |
| Refund plans and core changes are checked by | Deposit Operations Manager | Deposit Operations Manager · COO |
| Look-back | 12 months | 12 months · 24 months |
| Confidence below which a person decides | 0.90 | Any value; per-agent thresholds override it |
| Daily fee cap | 4 | From your fee schedule |
| Small-overdraft threshold | $5.00 | From your fee schedule |
| Keep test evidence and refund records | 5 years after a finding closes | 5 years · 7 years |
| Decide a finding | 10 business days from the draft | Any number of business days; escalates at the SLA |
Every figure is labelled: a target the solution is built to, an estimate, a typical published result, or a proven one.
“demo” = seen in the working solution, on its sample data · “target” = the design goal, measured in the live solution · “estimated” = our estimate · “typical” = published figures (CFPB Supervisory Highlights, Issue 37: about $184 million refunded for APSN fees and $66 million for re-presentment NSF fees since 2022; NCUA: about $3.8 billion in overdraft and NSF fees at reporting credit unions in a year; Congressional Research Service IN12513: 9% of accounts pay 79% of the fees). Rules named on this page: Regulation E, 12 CFR 1005.17; the Dodd-Frank Act and FTC Act unfairness standard (UDAAP); FDIC FIL-19-2023; NCUA letter to credit unions on overdraft and NSF fee practices, January 2025; Truth in Savings for credit unions, 12 CFR 707; Nacha reinitiation rules. The CFPB's 2022 circular on unanticipated overdraft fees was withdrawn on May 12, 2025 (90 FR 20084), and the FDIC rescinded its re-presentment guidance on April 10, 2026 (FIL-14-2026); neither is relied on. Norrell Federal Credit Union and the people, members, merchants, accounts and records named on this page are fictional: characters and sample data in the working solution.
Overdraft compliance is the testing a credit union's or bank's compliance team does to show that courtesy pay and NSF fees are charged fairly, as disclosed and with the consent Regulation E requires. Overdraft Compliance replays 12 months of posting for every member, tests every fee for authorize positive, settle negative (APSN), repeat fees on re-presented items and opt-in consent, and sizes the refund. The Compliance Officer approves each finding, and a second person checks every refund plan.
An overdraft fee on a debit card or ATM item that the available balance covered when the member authorized it, charged later because other items posted first and the account was negative when it settled. The FDIC (FIL-19-2023) sees heightened risk under both the available and the ledger balance method, and the NCUA's January 2025 letter to credit unions says examiners pay particular attention to these fees. Under the unfairness test, a disclosure alone does not make the fee avoidable when the member had the money at the moment they paid. The CFPB's 2022 circular on these fees was withdrawn in May 2025. The Settlement test agent judges each fee at the moment the member authorized the item, and labels the fee that stands as allowed.
Nacha rules let a merchant re-present a returned ACH debit up to two times within 180 days, labeled RETRY PYMT, but it is still one item. The NCUA's January 2025 letter names NSF fees on re-presented items as an exam focus, and CFPB examiners have cited them as unfair (Supervisory Highlights, Issue 37). The FDIC withdrew its own re-presentment guidance in April 2026 (FIL-14-2026) and expects disclosures to match practice, so the agent also tests each fee against the fee schedule's "per item" promise. The Re-presentment agent links every re-presented ACH debit and re-deposited check to its first return by its match keys, never on amount alone: the first NSF fee stands, and the later ones are tested for refund.
The Consent agent opens the record behind every ATM and one-time debit card fee instead of trusting the core's flag, and reads it in the order 12 CFR 1005.17 requires: the notice, a reasonable opportunity, the consent, the written confirmation. On the sample data it read 188,412 records and found 162 phone opt-ins taken before the notice was sent and 52 records lost in a core conversion.
When a finding is approved, the Refund agent adds its fees to the refund plan, removes overlaps and fees already refunded, splits credits, checks and estates, and drafts the general ledger entries. The Compliance Officer prepares the plan, the Deposit Operations Manager verifies a sample of members against their replays and approves it as checker, and only then does it go to the member remediation program.
Yes. After a practice change goes live, the same replay runs every night on the day's fees and tells the analyst only about fees that fail a test. On the sample data the watch has shown 0 repeat fees on re-presented items since the setting changed on October 19.
Yes. The agents test, cite and draft; they never approve a finding, post a refund, change a core setting or send a notice. The person who prepared an item can never approve it, every decision carries a reason code, and anything below the confidence threshold goes to a person with an owner and a due date.
The Agentic Solution Engine builds and deploys it from your requirements and documents, such as your fee schedule, member agreement, fee settings and a sample of posting history, and it goes live once every quality gate has passed. We will walk you through it on your own fees first.
Every community development activity qualified from its source document, then signed.
1-min demoConsumer Compliance TestingEvery item tested, not 60, and every exception evidenced before the exam.
1-min demoCustomer RemediationEvery affected customer found and paid, and every dollar traced to its end.
1-min demoWe'll run Overdraft Compliance on a sample of your own posting history, fee settings and fee schedule.