U.S. Office of the Comptroller of the Currency reprimands USAA for persistent issues in various sectors that remain unaddressed
The Office of the Comptroller of the Currency (OCC) has issued a comprehensive cease-and-desist order against USAA Federal Savings Bank, effective as of March 16, 2022. The order, which stipulates a range of measures to address regulatory concerns, was announced in mid-2025.
The exact details of the restrictions imposed on USAA's operations are not fully detailed in the available sources. However, the order represents a formal regulatory action typically used to compel a financial institution to stop certain practices that have raised regulatory concerns.
The order against USAA Federal Savings Bank comes as a result of significant regulatory issues that the bank has faced in recent years. While the specific violations or regulatory shortcomings that triggered the order are not explicitly detailed, they likely involve concerns regarding compliance failures, operational deficiencies, or unsafe and unsound banking practices.
Under the terms of the order, USAA is prohibited from making any incentive-based compensation payments to any covered individual effective April 1, 2025. The bank is also required to implement a fraud risk management program commensurate with its risk profile and appetite.
In addition, the OCC has directed USAA to fix a range of deficiencies in areas such as management, earnings, information technology, consumer compliance, internal audit, and suspicious activity reporting. The bank is also investing in additional systems, training, and reinforcing a strong risk management culture.
Within 90 days, the bank must submit an annual plan that details a proposed payment review process to ensure that any incentive-based compensation payments to any covered individual reflect any adverse risk outcomes. The OCC reserves the right to assess penalties or take further enforcement actions if USAA fails to address the issues identified in the most recent order.
The OCC's latest order replaces the 2019 and 2022 actions against the bank, which resulted in penalties of $85 million in 2020 and $140 million in 2022. The bank, which provides banking and insurance products to military members, veterans, and their families, is also prohibited from adding new products or services or expanding its membership criteria without evaluating and documenting the associated risks.
As part of the order, USAA Federal Savings Bank is also required to establish a unifying enterprise risk management framework. The OCC's latest order is aimed at advancing USAA's risk and compliance management.
In a related development, USAA CEO Wayne Peacock has announced that he will step down from his post in the first half of 2025. The exact date of his departure has not been disclosed.
For a complete understanding of the regulatory issues and the exact terms of the cease-and-desist order, official regulatory releases or statements from the bank’s regulators (such as the FDIC or OCC) would be required.
Despite the lack of explicit details, the cease-and-desist order issued by the Office of the Comptroller of the Currency (OCC) against USAA Federal Savings Bank in 2025 is believed to involve concerns related to finance and business, particularly compliance failures, operational deficiencies, or unsafe and unsound banking practices. USAA is obligated to implement a fraud risk management program aligned with its risk profile and appetite, as well as establish a unifying enterprise risk management framework to enhance its risk and compliance management.
