Bank of America fined for consumer abuses including fake accounts, bogus fees

Bank of AmericaThe second-largest U.S. bank by assets has committed fraudulent practices that have harmed hundreds of thousands of customers in recent years, Consumer Financial Protection Bureau said Tuesday.

The CFPB said in a statement that the bank charged a $35 overdraft fee multiple times for the same transaction, failed to properly issue incentives to credit card users, and registered credit card accounts for customers without their consent. statement.

Charlotte, North Carolina-based Bank of America was ordered to pay a total of $150 million in fines to the CFPB and another regulator, the Office of the Comptroller of the Currency. In addition to the $23 million it has already paid out to customers who were improperly denied card incentives, the company must pay about $80.4 million to customers who were unfairly charged bogus fees.

“These practices are illegal and undermine customer trust,” CFPB Director Rohit Chopra said in a news release. “The CFPB will end these practices across the banking system.”

In response, Bank of America spokesman Bill Halldin said the bank “voluntarily reduced overdraft fees and eliminated all insufficient funds fees in the first half of 2022,” resulting in a 90% drop in revenue from those fees.

Tuesday’s announcement is the latest sign of some of the practices the agency has uncovered FuGuo bank The 2016 fake accounts scandal was not limited to the bank.

Regulators penalized Wells Fargo for a sales culture that led to the creation of 3.5 million fake accounts. But other lenders have made similar missteps, include Bank of AmericaLast year, the company paid $37.5 million in fines for depositing customers into unauthorized accounts.