A suburban Atlanta financial services firm has sued Suncoast Credit Union, alleging the Tampa credit union reneged on a contract.
Suncoast is aware of the lawsuit, and strongly denies the allegations, said Patti Barrow, a spokesperson for the credit union.
“They simply have no merit and we will aggressively defend our organization against the charges,” Barrow said in a statement.
Suncoast is the largest credit union in the Tampa Bay area, with $10.4 billion in total assets and 844,897 members as of June 30. The credit union serves anyone who lives, works, worships or attends school in 40 Florida counties, including Pinellas and Hillsborough.
Econ-O-Check filed the lawsuit July 3 in federal court in Tampa, alleging breach of contract and fraudulent inducement. The breach cost at least $2 million in damages, the lawsuit said.
Econ-O-Check, based in Stockbridge, Georgia, provides checking account enhancement services to financial institutions. The company says on its website that it has helped thousands of financial institutions deepen customer relationships and achieve their revenue goals.
Econ-O-Check and Suncoast signed an agreement in January 2018, under which Suncoast said it would establish and promote Econ-O-Check’s secure checking program in its branches beginning on April 1, 2018, according to the complaint. The initial term of program was for three years. Suncoast was obligated to report to Econ-O-Check the total number of secure checking program accounts monthly, and pay the company a monthly fee of $1.95 per enrollee, with a minimum monthly payment of $1,000, the complaint said.
Suncoast failed to establish the program on April 1, and on Sept. 11, Darlene Johnson, Suncoast’s chief operating officer, confirmed to Econ-O-Check that Suncoast decided not to launch the program, the complaint said.
On Oct. 1, after months of informal discussions, Econ-O-Check formally notified Suncoast that it was in breach of the contract, according to the complaint. Econ-O-Check proposed a forbearance agreement in November, giving Suncoast time to cure its breach, but the parties negotiated for seven months without reaching a final agreement, the complaint said.
Econ-O-Check is asking for a jury trial, and that it be awarded damages and legal fees.