The Consumer Financial Protection Bureau (CFPB) announced on Thursday (Jan. 3) that it had reached a settlement with USAA Federal Savings Bank over allegations that the bank violated the Electronic Fund Transfer Act, among other transgressions.
USAA, which is headquartered in San Antonio, Texas, was accused of not properly honoring customers’ requests to stop payments on preauthorized electronic fund transfers. It also failed to start and complete reasonable error resolution investigations, the Bureau said.
In addition, USAA violated the Consumer Financial Protection Act of 2010 by reopening previously closed deposit accounts without authorization from customers, or prior notice.
Under the terms of a consent order, USAA must pay an estimated $12 million in restitution to customers who didn’t get a reasonable error resolution investigation, as well as $3.5 million in civil money penalty.
In an email to the San Antonio Express-News, USAA said it was acting in the best interests of its customers. “None of these issues reflect an intention to take advantage of our members,” Matt Hartwig, USAA spokesman, told the newspaper. “In fact, we believed our processes would help resolve matters faster. We take responsibility [for] this situation.”
Last year, USAA debuted a new augmented reality (AR) mobile app to help its customers buy cars. The app uses Blippar technology that allows users to point their phone at any vehicle that is a 2000 model or newer to immediately see the car’s info, including price, insurance costs and similar vehicles for sale in the area. It also allows users to quickly access USAA’s Car Buying Service to find dealers, rates for loans, and cost and availability information.
“Since 1922, USAA’s goal has been to provide great service through exceptional experiences,” said Chris Cox, chief digital officer at USAA, in a press release. “We welcome the opportunity to explore a variety of augmented reality use cases that are ultimately meant to make our members’ lives easier and facilitate their financial security.”