Consumer complaint received 2023-04-04
Company: UNITED SERVICES AUTOMOBILE ASSOCIATION
State: NC
Product: Vehicle loan or lease
Sub-product: Loan
Issue: Getting a loan or lease
Sub-issue: Fraudulent loan

Complaint:
I am the owner of a small vehicle dealership in XXXX XXXX, North Carolina ; All City Auto Sales. On XXXX, a customer came to purchase a vehicle for {$41000.00} and presented loan approval documentation from USAA Federal Savings Bank. We contacted USAA, and their representative verified the validity of the loan. USAA even stated that this customer is eligible to add a warranty onto the loan. 

On XXXX, when we contacted USAA to notify that that we had not been funded, and they indicated that they would not be moving forward with the loan. USAA stated that they could not give us any details as to why or what had changed, citing member privacy. One representative eventually acknowledged that this was due to fraud, then stated that we were not supposed to be informed of that. 

In the days following, I learned that XXXX XXXX XXXX has scammed multiple local dealerships, using USAA paperwork and under his same name.

He has been arrested and charged with a number of felonies, including ( but not limited to ) obtaining property from by false pretenses, firearms charges, uttering, and receiving stolen property. I spoke with several people representing other local car dealers ( XXXX XXXX XXXX, XXXX XXXX, and XXXX XXXX XXXX XXXX and they expressed a shared frustration with USAA for lack of transparency and cooperation each time this has happened, as well as USAA verbally validating loans over the phone, then refusing to take accountability for the financial loss incurred, leaving the auto dealer at a loss. 

On XXXX, we learned that the vehicle was being held at an impound lot due to being crashed the day after the customer took possession. We retrieved the vehicle and brought back to our lot. 

XXXX we contacted USAA and were again told that they would not be moving forward with the loan. USAA rep, XXXX, declined to share information, citing confidentiality of company policies and procedures as well as customer confidentiality. I offered to unilaterally share information that we have gathered ( we have spoken to multiple other dealerships in our area- XXXX XXXX XXXX XXXX XXXX  XXXX XXXX XXXX XXXX XXXX ) and learned that XXXX XXXX has done the same thing at those dealerships, using his same identity as well as the same USAA loan paperwork ). I told XXXX that we share a common interest with USAA in halting this person from doing this again. XXXX stated that she declined for me to give her any details regarding this situation or individual. 
I am concerned that USAAs conduct is at best, negligent, and at worst, demonstrates complicity in this scheme, by withholding key information when dealerships call to validate the loans made by XXXX XXXX XXXX. Dealerships have been left with no recourse and USAA has yet to take accountability by being evasive, rather than cooperative. To our knowledge, USAA has yet to take legal action or steps to attempt to flag XXXX XXXX in their own systems as not being eligible for a loan.

Company public response: Company believes it acted appropriately as authorized by contract or law
Company response to consumer: Closed with explanation