On Tuesday, Bank of America (BAC), the second largest bank in the nation agreed to pay a hefty fine of $250 million after it faced claims of double-charged customer fees, withholding of credit card perks and more were levied by the Consumer Financial Protection Bureau (CFPB) and the Office of the Comptroller of the Currency (OCC). The bank also reportedly opened accounts for customers without their authorization.
The Consumer Financial Protection Bureau (CFPB) said that Bank of America had made tens of millions of dollars by charging customers who did not have sufficient funds in their accounts, multiple fees.
The newsroom of the site also said Bank of America also withheld cash rewards and bonus points that had been promised by the bank to its credit card customers. The bank also opened credit card accounts for customers, without their knowledge and acquiescence. These illegal accounts were reportedly opened by Bank of America employees from 2012.
In a statement, CFPB director Rohit Chopra said, “Bank of America wrongfully withheld credit card rewards, double-dipped on fees, and opened accounts without consent. These practices are illegal and undermine customer trust. The CFPB will be putting an end to these practices across the banking system.”
According to the CFPB newsroom, “The CFPB’s orders require the Bank of America to:
stop to repeat offenses
pay redress to harmed consumers
pay $90 million in penalty to the CFPB.”
The site’s newsroom also described Bank of America as the second largest bank in the nation as its assets included $1.9 trillion in the form of domestic deposits as well as $2.4 trillion in the form of consolidated assets, as per March 31, 2023.
In a statement Bank of America said, “We voluntarily reduced overdraft fees and eliminated all non-sufficient fund fees in the first half of 2022. As a result of these industry leading changes, revenue from these fees has dropped more than 90 percent.”
Bank of America has agreed to resolve the charges against it by paying more than $100 million to consumers who were harmed by its illegal practices. It will also pay fines of $90 million to the CFPB as well as $60 million to the OCC.
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CWEB Business News Letter July 11th 2023
