Credit Union refusal to release funds to nominee

[Demac98]

My father died recently, leaving me as his nominee to receive his savings in the Credit Union.
The Credit Union is refusing to release the funds to me, as I have an outstanding debt to the Credit Union.
They say they are entitled to offset the monies against my debt.
Can anyone please provide guidance on the legal basis for they doing this?
Thank you.

 

[Dr Strangelove]

I have an outstanding debt

Is this a normal loan that you are paying off on time?

Or is it a loan in arrears?