SAN DIEGO—Following Sen. Elizabeth Warren’s (D-MA) request that the Department of Defense freeze a contract between the U.S. Marine Corps and $1.5-billion Frontwave Credit Union here due to what she called “excessive” overdraft fees, the Marine Corps has renewed its contract with the CU.
KPBS said it has confirmed the Marine Corps renewed the contract with Frontwave, but the news outlet stated a Marine Corps spokesperson declined to provide a copy of the new agreement.
As CUToday.info reported, Warren, ranking member of the Senate Armed Services Subcommittee on Personnel, wrote to Secretary of the Department of Defense Pete Hegseth last week making the request.
Warren’s letter to the DoD asked for a freeze on contracts between the DoD and all banks and credit unions operating on military bases until perceived issues with overdraft practices are addressed.
After learning about the KPBS report, Defense Credit Union Council President and CEO Anthony Hernandez told CUToday.info that military installation commanders have the authority to renew all operating agreements in accordance with DoD regulations.
“I am very confident Frontwave Credit Union has met and/or exceeded all standards just as they have for decades,” Hernandez said.
America's Credit Unions Chief Advocacy Officer Carrie Hunt said ACU appreciates that the Department of Defense continues to recognize the value credit unions bring to servicemembers by ensuring uninterrupted access to financial services on base.
"Defense credit unions, including Frontwave, take great pride in providing financial services to those who need it most, including active military members, veterans, and their families. We look forward to continuing our work with our defense credit union members and the DoD to further strengthen the services provided," Hunt said.
Last week America’s Credit Unions and the Defense Credit Union Council each responded to the move by Warren.
DCUC’s Hernandez said the trade association is working to address any potential issues with Frontwave’s operating agreement with the Marine Corps Recruit Depot in San Diego.
"DCUC is working on this issue in accordance with DoD regulations and long-standing practices," Hernandez said. “In fact, we have a meeting set with DoD officials to resolve any potential issues pertaining to Frontwave’s operating agreement with the military installation. Sometimes it’s best just to pick up the phone and call. We look forward to resolving any potential base access issues on behalf of Frontwave.”
America’s Credit Unions President/CEO Jim Nussle wrote to Hegseth and Warren.
In ACU’s letter to Hegseth, Nussle reminded that credit unions have provided financial services on U.S. military bases since 1928, and on overseas military installations since 1967.
“And this commitment was affirmed with a 2006 amendment to the Federal Credit Union Act providing the Department of Defense discretionary authority to provide facilities at nominal costs to credit unions that meet certain requirements,” Nussle stated.
KPBS said Warren declined to comment through a spokesperson.