Vystar Credit Union Banking Platform Outage Affects Thousands of Customers

Vystar Credit Union's banking platform experienced a significant outage, affecting thousands of customers.

The outage occurred on a Thursday morning, causing disruptions to online banking services.

Customers reported difficulties accessing their accounts, making transactions, and receiving notifications.

The credit union's website and mobile app were also unavailable during the outage.

VyStar Credit Union, one of the largest credit unions in the country, faced a major banking platform outage in May 2022.

The CFPB took action against VyStar, alleging that the credit union botched the rollout of its new online banking system. VyStar's management and governance failures led to the outage, which made it difficult for members to perform basic banking functions for weeks.

The CFPB found that VyStar rushed to complete the platform conversion despite warnings from its development team, leading to a virtual banking outage and ongoing functionality issues. VyStar's senior management was criticized for their careless errors, which inflicted financial harm on credit union members.

The CFPB ordered VyStar to refund fees to affected consumers, including interest costs imposed on members as a result of the outage. VyStar must also pay a $1.5 million civil penalty to the CFPB's victims relief fund.

Here are the key issues with VyStar's rollout of its new online banking system:

VyStar Credit Union's online and mobile banking platform has been unavailable for a week, causing concern and displeasure among customers.

The outage began on May 13 as VyStar converted to a new system, but "experienced several issues during the conversion process", despite thorough testing.

Some customers expressed concern and displeasure with the outages, while others joked about the issue online throughout the week.

Direct deposits are not impacted by the conversion and are being processed as expected in members' accounts.

VyStar said telephone wait times are somewhat longer than normal, but additional support team members have been brought in to help.

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VyStar denied rumors of a ransomware attack, stating that all funds and personal data remain safe and secure in their core system.

VyStar Credit Union's rollout of its new online banking platform was a disaster. The platform was dysfunctional for weeks, making it difficult for credit union members to perform basic banking functions.

The CFPB found that VyStar brought the new system online prematurely and failed to establish or follow critical processes to ensure its success. This led to a virtual banking platform outage and sustained period of limited functionality.

Credit union members incurred costs as a result of these problems, including being unable to manage their accounts, being charged late fees when their online bill payments did not go through, and being unable to access their funds.

The CFPB's order requires VyStar to develop contingency plans to minimize the impact that future updates to its banking platform will have on members. These plans must provide sufficient customer service resources to address consumer problems.

VyStar was also required to refund fees to affected consumers, including outstanding third-party fees or costs, including interest costs, imposed on members as a result of the outage.