Consumer complaint received 2025-12-03 00:00:00
Product: Checking or savings account — Checking account
Issue: Managing an account — Deposits and withdrawals
Company: UNITED SERVICES AUTOMOBILE ASSOCIATION
State: TX

Complaint narrative:
Subject : Complaint Against USAA FSB for Improper Denial of Fraud Claim, Reversal of Provisional Credits, and Wrongful Use of VA XXXX  Benefits To Whom It May Concern, I am filing this complaint regarding USAA Federal Savings Bank ( USAA ) for its handling of my fraud dispute, its reversal of provisional credits without proper notice, and its subsequent use of my VA XXXX benefits to cover a negative balance created by those reversals. I am a 100 % Unemployable Veteran, and these actions have caused serious financial hardship. 

Summary of Events I disputed two unauthorized or theft-by-services transactions on my USAA account in the following amounts : {$150.00} {$3900.00} USAA initially issued provisional credits for these two transactions while it conducted its investigation. On XXXX XXXX XXXX USAA reversed both provisional credits. This caused my account balance to fall to {$3900.00}. USAA then re-applied only the {$150.00} provisional credit, bringing my account balance to {$3700.00}. 

At the time of these reversals, I did not receive any advance notice. I later learned that USAA had placed letters in the secure inbox inside the USAA app. My app notifications were not enabled, and I was unaware of these messages. Only after USAA had already reversed the provisional credits and created the large negative balance did a USAA representative assist me in turning on app notifications. USAAs own recorded phone calls will confirm that I was not notified prior to the reversal of the provisional credits. 
Improper Use of VA XXXX Benefits On XXXX XXXX XXXX, my VA XXXX Compensation in the amount of {$3800.00} was deposited into my USAA account. Because USAA had previously reversed the provisional credits and driven my account to a large negative balance, USAA immediately absorbed this entire VA XXXX payment into that negative balance. After this deposit, I was left with only {$34.00} in my account. 

On XXXX XXXX XXXX USAA then allowed an insurance payment of {$200.00} to process against my account and also charged a {$29.00} overdraft fee. As a result, my account balance became {$220.00}. 

My VA XXXX benefits are federally protected. Under 38 U.S.C. 5301 ( a ), VA benefits are exempt from levy, attachment, seizure, or setoff. USAAs use of my VA XXXX compensation to cover a negative balance created by the reversal of provisional credits appears to violate this protection. 
Regulation E and Investigation Concerns USAA denied my fraud claim and justified its decision by stating that the transactions were outside the depository agreement date. This explanation is vague and does not demonstrate that the disputed transactions were authorized. Under Regulation E ( 12 CFR 1005 ), a financial institution must conduct a reasonable, good-faith investigation, provide clear written notice of its findings, and meet strict timing and notice requirements before reversing provisional credits. 

In my case, USAA reversed the provisional credits on XXXX XXXX XXXX, without providing effective prior notice. Placing letters into an in-app inbox that I was not configured to receive notifications for does not meet the spirit of Regulation E notice requirements, particularly where the reversal of those credits would drive my account deeply negative and lead to the seizure of my VA XXXX compensation. 
Requested CFPB Action I respectfully request that the Consumer Financial Protection Bureau : 1. Investigate USAAs handling of my fraud dispute and its compliance with Regulation XXXX, including its investigation, its notice practices, and its reversal of provisional credits. 
2. Determine whether USAA improperly used my VA XXXX benefits to offset a bank-created negative balance in violation of 38 U.S.C. 5301 ( a ).

3. Require USAA to reinstate the removed provisional credits or refund the disputed amounts of {$150.00} and {$3900.00}.

4. Require USAA to return any VA XXXX funds that were improperly applied to the negative balance. 
5. Require USAA to provide a full, transparent written explanation of its findings, its procedures, and the basis for its denial of my fraud claim. 

Conclusion I am a 100 % Unemployable Veteran and rely on my VA XXXX compensation for basic living expenses. USAAs actions have caused severe financial hardship and appear to conflict with both consumer protection laws and federal protections specific to veterans benefits. 

I appreciate the Bureaus attention to this matter and request a thorough review and corrective action as appropriate.

Company public response: Company has responded to the consumer and the CFPB and chooses not to provide a public response
Company response to consumer: Closed with explanation