WHAT YOU NEED TO KNOW ABOUT THE $64M USAA CLASS ACTION LAWSUIT PAY OUT


By bblouin
The USAA building in light of the USAA class action lawsuit.

Service members have protections from the federal government to help protect their finances through the Servicemembers Civil Relief Act (SCRA). This applies to fees and interest rates on loans aimed at preventing compound interest from charging our military who are busy performing their duties. While they didn’t admit to violating the SCRA, a settlement involving the USAA class action lawsuit is coming to pass. This is after allegations were made against the financial institution.

USAA Class Action Lawsuit Settlement of $64M for Those Affected

A USAA class action lawsuit has finally come to a settlement agreement to pay $64.2 million. This is after allegations of their banks not adhering to the SCRA. Subsidiaries USAA Federal Savings Bank and USAA Savings Bank didn’t say that they were responsible for charging high-interest fees; however, they would settle to providing millions of dollars back to the military community. The case began in November 2021 after 210,000 members filed the class-action suit with four plaintiffs alleging lower interest rates and fees were not implemented following SCRA. Those filing the class action lawsuit against USAA alleged that failing to provide lower rates caused an inflated balance for service members, elevating interest even further and creating higher balances as a result.

Bulls et al. v. USAA Federal Savings Bank et. al.

Compounding the issues alleged within the USAA lawsuit is the claim that the banks hid the overcharges from their customers, who are made up of the military community. Not only are the claimants saying that USAA violated federal law but also its own Military Benefits Program. The USAA lawsuit would show 546 violations of the SCRA by the U.S. Treasury's Office of the Comptroller of the Currency and another 54 violations of the Military Lending Act. Additionally, it was alleged that reservists ended up having to pay not only high fees but also deal with their vehicles being repossessed wrongfully. All of this happened while USAA got a $85 million fine in 2020. This is because it didn’t have anything in place to ensure compliance to operate within the law.

Disagreements About the USAA Class Action Lawsuit

While those who filed the lawsuit feel strongly in their position, USAA “strongly disagrees” with the situation. However, the settlement is a quicker solution that is going to move along the legal process. It will help the company put everything behind them, and turn over a new leaf of providing service to the bank’s members. There are reports that before the settlement, USAA was already reversing the issues that affected its members. However, those with allegations against the bank said that the reimbursement was misleading in their labeling. This was causing some to throw them away. If a judge approves the USAA lawsuit settlement, each plaintiff is going to receive just north of $200. The four named members will receive around $20,000 each. It’s unclear who would be notified. However, anyone who was a troop either receiving or depositing checks with a USAA bank are eligible. What did or didn’t happen is in the past but the allegations involving USAA are still noteworthy. Hailing from San Antonio, Texas, the insurance carrier has around 14 members with almost 9 million as a part of the USAA Bank specifically. The millions of customers are all part of the military community. Maintaining integrity while providing a quality service is important for all especially those sacrificing for our freedoms. Hopefully, the USAA class action lawsuit settlement will rectify the alleged issues brought up in the case for all parties involved. Suggested reads:


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