Consumer complaint received 2019-12-16
Product: Checking or savings account — Other banking product or service
Issue: Managing an account — Funds not handled or disbursed as instructed
Company: UNITED SERVICES AUTOMOBILE ASSOCIATION (IL)

My first contact with USAA was on XX/XX/2019 to their Survivor Relations Department after I had spoken to my Aunt who informed my brother and I that my recently deceased Uncle had named us as beneficiaries on three USAA accounts. I contacted USAA to advise of this and they were awaiting our calls. Contact was needed in order to have USAA send us the paperwork to transfer the funds to each of us. In this phone call, I indicated that I was going to be transferring this money to an IRA with my financial institution because it did not want to pay taxes on the funds. They advised that they would mail the forms ( 100 + pages ) and I needed to fill out and return the Inherited IRA form to USAA. I received the paperwork on or around XX/XX/2019. The funds had to leave my uncle 's account, go into a USAA Inherited IRA in my name, then close that account immediately out because I was not an eligible USAA account holder. I faxed my paperwork to USAA at the fax number given on XX/XX/2019. I did not hear anything for some time. I called the Survivor Relations Department in the beginning of XXXX after we hadnt heard anything. All three of us beneficiaries had to have our paperwork in before they would move any funds. When I called, mine and my brothers paperwork was lost. The representative found it and placed it in the correct department. My brother and I were communicating with each other after this point because we were getting different explanations of what was going to happen and when and how the funds would be moved. My brother was advised that we would only be getting checks sent to us and we assumed the check would be in some form that I could deposit with XXXX XXXX without a tax penalty. On or about XX/XX/2019 I received a phone call from XXXX in the survivor relations department wherein she stated that the record had shown from a previous phone call that I had wanted to transfer the funds to another account and she asked me if that was still accurate. I immediately replied yes that was still accurate but you guys told my brother who had spoken to a representative at USAA just days prior and said that they could only issue checks to us. She said OK and the phone call ended. If I was incorrect in any part of my description to her on what I wanted to happen with my funds, she should have corrected me right then and there. She should of advised that a transfer form was still needed in order to move this money to another Inherited IRA at my financial institution, XXXX XXXX. At this point, I was still assuming that my check will be in a form wherein it will be a tax-free transfer/rollover. After a long time and many phone calls between my brother, aunt and I, we were finally notified that the checks were going to be sent out on XX/XX/2019. I still had not received any information on the Inherited IRA that USAA said they had to open for me. I had no account number, date it was opened, or the amount that was in that account. That was later sent to me by US Mail and dated XX/XX/XXXX, which I did not receive until almost two weeks later and well after we found out that the checks sent to us were taxable. Once the checks were received, my brother and I took our checks to our financial institution, XXXX XXXX, to be deposited into our Inherited IRA 's. We were then notified that these were taxable distributions. We did not deposit the checks and immediately contacted USAA of the mistake. They told us the transaction could not be reversed because the accounts were closed. We both filed complaints with USAA. My complaint was called in to the USAA survivor relations department, along with letters I mailed and faxed to USAA CEO, CEO of the bank, and USAA Legal Department on XX/XX/2019. I received a call back from the USAA Survivor Relations Escalation Department XX/XX/2019 and have gone back and forth many times up until a final decision was made by USAA not to reverse the transaction on, XX/XX/2019 at XXXX because there was no bank error. I asked for a written letter as to why they would not reverse the transaction since my check was not cashed and XXXX advised that it would take 1-2 months for this letter to be written. This was unacceptable. My brother also filed a complaint with USAA. He never received a phone call from his advocate, XXXX in the CEO office. I had a representative, XXXX, in the survivor relations escalation department who communicated through me. I then communicated to my brother because he was still not receiving any phone calls on the status of the matter. This is totally improper. I was told that if they reverse one account they would reverse them both. I also had an advocate in the CEO office who I only learned of on XX/XX/2019, XXXX, who NEVER called me, even though the record reflected she did. I did not hear from her until XX/XX/2019, when a call was requested via XXXX in the same department via my brothers phone call on Friday, XX/XX/2019. The lack of continuity in this USAA department is stifling. Myself and my brother both had the same intentions with regard to the money and it was voiced many times, we spoke separately to USAA and we both ended up with the same outcome. No one in that department could accurately tell us that they needed a transfer form from my financial institution, and it did not come from USAA. When I finally spoke to XXXX, she said she didnt need to speak with me since XXXX was speaking to me. After I pressed XXXX on why the account couldnt be reversed she said it was because it was against regulation. I asked what regulation specifically and she said that since USAA got in trouble about a year ago for closing and opening accounts for its customers. I told her this situation was not the same. I believe that if we were USAA account holders we would have been treated differently. Every time we called USAA they advised that they would be recording the call. My intentions are accurately reflected in the phone calls leading up to them issuing the checks. This check is for about {$230000.00}. I am now out the interest I could have been making in my new Inherited IRA which was opened at XXXX XXXX on XX/XX/2019. We have also hired an attorney on this matter and sent a letter to the USAA Legal Department. I also had two other accounts with USAA, one savings account and one mutual fund. I had no problems communicating my intentions to them. In fact, they asked for more information on these smaller accounts then they did on this large IRA account. They, of course, were different departments within USAA.