A whistleblower recently filed a defamation lawsuit against the United Services Automobile Association (USAA), specifically its indirect wholly owned subsidiary, USAA Federal Savings Bank (USAA Bank). The case, which a judge in Florida dismissed, revealed that the USAA had about 400,000 violations of the Military Lending Act (MLA).
A former USAA director of compliance, Lenn Ferrer, stated in 2022 that senior executives at the company disregarded warnings from third-party consultants and compliance staff for years. These executives purposely ignored notices of violations of federal banking legislation and regulatory authorities. The USAA hid its illegal practices, including violations of the Servicemembers Civil Relief Act (SCRA) and MLA, as well as other consumer lending laws.
Ferrer said that he has been all about the right thing and telling the truth from the start. Since Compliance Week released its investigative series in 2022, other third-party contractors and USAA risk and compliance insiders shared their own experiences with the company. These people were fired from the company days or weeks after reporting the violations internally.
