By Dean Lyle | Guest Commentary, Rocky Mountain Voice
Veterans are pillars of our society, honored for their sacrifices and service. Companies like USAA and Navy Federal Credit Union have built their brands around serving military families, often positioning themselves as trusted allies.
However, recent legal actions reveal troubling alleged practices that seem to exploit veterans rather than support them.
From overcharging to surprise fees, these institutions have faced serious accusations of prioritizing profits over their commitment to the military community.
USAA: A pattern of failures and violations
USAA, founded to serve military members and their families, has faced mounting scrutiny for failing to uphold its promises. In addition to the $64.2 million settlement in 2023 for allegedly overcharging customers by failing to refund unearned premium payments, the Office of the Comptroller of the Currency (OCC) recently levied an $85 million civil money penalty against the company.
The OCC’s penalty stems from USAA’s alleged failure to implement and maintain effective compliance and information technology risk management programs. These alleged deficiencies led to violations of several laws, including the Military Lending Act and the Servicemembers Civil Relief Act. These laws are specifically designed to protect service members from predatory financial practices and undue hardship, making USAA’s alleged violations particularly egregious.
The OCC noted that USAA is working to address these issues under the terms of a 2019 consent order, but the penalty serves as a stark reminder of the company’s obligations. The $85 million fine, paid to the U.S. Treasury, underscores the severity of the lapses in governance and compliance.
Navy Federal Credit Union: Surprise overdraft fees
Navy Federal Credit Union (NFCU), another organization claiming to champion military families, faced its own significant penalties in 2023. The Consumer Financial Protection Bureau (CFPB) fined NFCU $15 million and ordered it to return $80 million to members affected by alleged “surprise” overdraft fees.
These fees were allegedly charged without adequate warning or consent, catching members off guard and disproportionately affecting those living paycheck-to-paycheck. The CFPB accused NFCU of repeatedly engaging in practices that caused unnecessary financial strain on its members — many of whom are veterans.
This case highlighted a fundamental betrayal of trust. NFCU, like USAA, markets itself as a dedicated ally to military families, yet its actions revealed a stark disconnect between its brand promises and its business practices.
The impact on veterans and military families
Veterans face unique financial challenges, from navigating civilian financial systems to managing transitions in employment and housing. Institutions like USAA and NFCU, which explicitly target this community, are supposed to ease these burdens. When they fail, the consequences are deeply personal and financial.
Violations of trust by these institutions do more than harm individual veterans — they erode confidence in organizations designed to protect and support military families. For service members and their loved ones, financial stability is crucial, and unexpected fees, overcharges or noncompliance with protective laws can lead to cascading hardships.
The recent actions against USAA and Navy Federal Credit Union reveal a troubling reality: even companies that claim to champion veterans can fall short of their promises. While financial penalties and settlements may address immediate violations, they cannot undo the alleged harm caused to the trust and financial stability of veterans and their families.
It is incumbent upon these institutions to recommit to their core mission of serving those who served. For veterans, advocacy, transparency and accountability are essential to ensuring they are treated with the respect and dignity they deserve. It’s time for these companies to truly live up to the ideals they promote.
Editor’s note: Opinions expressed in commentary pieces are those of the author and do not necessarily reflect the opinions of the management of the Rocky Mountain Voice, but even so we support the constitutional right of the author to express those opinions.