AFP – United States (US) regulators ordered Bank of America to pay USD250 million in fines and restitution for unfair fees and other banking violations that harmed consumers, authorities said.
Bank of America “double-dipped” on fees on customers for holding insufficient funds, repeatedly charging them a USD35 penalty for the same transaction, said the Consumer Financial Protection Bureau (CFPB).
The US bank also withheld promised cash and points to consumers who signed up for credit cards, the CFPB said.
In a third violation listed by the agency, Bank of America employees illegally applied for and enrolled consumers in credit card accounts without the consumer’s knowledge; these actions were tied to “now disbanded sales-based incentive goals and evaluation criteria,” the CFPB said.
“Bank of America wrongfully withheld credit card rewards, double-dipped on fees, and opened accounts without consent,” said CFPB Director Rohit Chopra.
“These practices are illegal and undermine customer trust. The CFPB will be putting an end to these practices across the banking system.”
Under the orders, Bank of America will pay USD90 million in penalties to the CFPB, USD60 million in fines to the Office of the Comptroller of the Currency and USD100 million in customer restitution.
Bank of America eliminated non-sufficient fund fees in the first half of 2022 and reduced overdraft fees from USD35 to USD10.
As a result of the changes, Bank of America saw a more than 90-per-cent drop in revenue from these fees, said an e-mail from a Bank of America spokesperson that did not address the other issues in the enforcement.
