At 06.11 hours on 12 Mar, 1942, the unarmed and unescorted Olga (Master William Dewey Graham) was hit by one torpedo from U-126 about 20 miles north of Nuevitas Light, Cuba in the Old Bahama Channel, while steaming on a nonevasive course at 10.5 knots. The torpedo struck on the port side at the #4 hold, destroying the fireroom bulkhead, blowing away the #4 hatch cover and wrecking the wheelhouse and radio room. A lookout had spotted the torpedo wake but it was too late to take avoiding action. The crew of eight officers and 25 crewmen abandoned ship in one lifeboat and two rafts, while the ship stopped and sank at 06.40 hours.
The first mate Arthur Wilder was picked up by the U-boat, questioned and was then allowed to swim to the nearest raft containing three other men. When the U-boat got underway, its wake swamped the raft and washed the men from it. The second cook died in the water from shock and exposure. The survivors were picked up by a US Naval craft and taken to Guantanamo Bay, Cuba.