Trump CFPB Cancels $95 Million Settlement With Credit Union Accused of Charging Illegal 'Junk Fees'

According to an order published Tuesday, the country's top financial protection watchdog nixed a $95 million settlement reached in 2024 with Navy Federal Credit Union, which serves military servicemembers, veterans, Department of Defense employees, and their families. The President Joe Biden-led Consumer Financial Protection Bureau last year accused the bank of illegally charging overdraft fees to customers and ordered the credit union to refund consumers and pay a civil penalty.

Multiple observers, including a former Consumer Financial Protection Bureau (CFPB) employee, said that the move appears to run counter to the CFPB's stated priority of focusing "its enforcement and supervision resources on pressing threats to consumers, particularly service members and their families, and veterans."

The Tuesday order means that Navy Federal will not have to pay $80 million to impacted customers, or a $15 million civil penalty.

In November 2024, the CFPB under then-President Joe Biden said that from 2017 to 2022, the credit union charged customers "surprise overdraft fees on certain ATM withdrawals and debit card purchases, even when their accounts showed sufficient funds at the time of the transactions," in a statement announcing the $80 million refund and the civil penalty.

Then-CFPB Director Rohit Chopra accused the credit union of "illegally harvested tens of millions of dollars in junk fees, including from active duty servicemembers and veterans."

The order on Tuesday is not the first time the Trump administration has canceled enforcement actions brought under the Biden-led CFPB. The Trump administration has sought to drastically cut personnel at the CFPB, which is currently led by Office of Management and Budget Director Russell Vought.

Adam Rust, director of financial services at the Consumer Federation of America, a non-profit association of pro-consumer organizations, wrote on X on Tuesday that "it doesn't square when the CFPB gives a free pass to Navy Federal for charging illegal overdraft fees AND claims it cares about servicemembers."

"How many millions did this CFPB just take from servicemembers?" he asked.

Allison Preiss, a former senior advisor to the director at the CFPB, reacted to the news by writing on X that "for months, Trump's CFPB has insisted it is focusing its efforts on protecting servicemembers and veterans," and included some screenshots of statements from the CFPB, such as a statement from May 2025 announcing that the bureau will not prioritize enforcement action related to Buy Now, Pay Later loans.

"The bureau takes this step in the interest of focusing resources on supporting hard-working American taxpayers, servicemen, veterans, and small businesses," according to that statement.