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Thursday, October 15, 2020

Federal regulators fine San Antonio's USAA Federal Savings Bank $85 million

Posted By on Thu, Oct 15, 2020 at 9:52 AM

click to enlarge TWITTER / USAA
  • Twitter / USAA
Federal regulators have hit San Antonio's USAA Federal Savings Bank with a $85 million penalty for violations of federal banking laws that constitute a "pattern of misconduct."

In a federal consent order made public Tuesday, the Office of the Comptroller of the Currency said the bank’s internal controls and IT systems failed to meet federal guidelines and that its risk management system was inadequate given its size. The company is in the process of fixing those violations under a legal agreement with the feds, according to the agency. 



USAA Bank is a subsidiary of San Antonio-based financial services giant USAA, which offers services to members of the military and their families. The company is one of the city's largest private employers.

In a statement supplied to the Express-News, USAA CEO Wayne Peacock said the bank failed to make the investments needed to meet federal requirements during a decade of quick expansion.

“We have been working diligently and investing substantial resources to address the gaps," he said. "This is our most urgent and fundamental priority and is essential to serve members with excellence, now and in the future."

Earlier this month, the OCC lowered USAA Federal Savings Bank’s grade from "satisfactory" to "needs to improve," saying it found evidence of 600 legal violations, including wrongfully repossessing vehicles and filing inaccurate affidavits in court cases.

The trouble with federal regulators comes after USAA Federal Savings Bank faced a social media backlash for pulling money out of federal pandemic stimulus checks deposited into some customers' accounts to cover overdrafts. The company ultimately discontinued that policy.

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