Feds Order Bank of America to Pay $250M in New Scandal

Bank of America must pay more than $100 million to customers for doubling up on some fees, withholding reward bonuses, and opening accounts without customer consent, reports the AP. Bank of America will pay $90 million in penalties to its organization and $60 million in penalties to the Office of the Comptroller of the Currency, the Consumer Financial Protection Bureau said Tuesday. The OCC found the bank's double-dipping on fees was illegal. CNN notes that the fake accounts allegation is similar to the Wells Fargo scandal that saw it pay billions in fines. Bank of America, based in Charlotte, North Carolina, serves 68 million individual and small-business clients. The bank had $2.4 trillion in consolidated assets and $1.9 trillion in domestic deposits as of March 31, making it the second-largest bank in the US. The bank didn't immediately respond to requests for comment.

Bank of America had a policy of charging customers $35 after the bank declined a transaction because the customer didn't have enough funds in their account, the CFPB said. The agency determined that the bank double-dipped by allowing fees to be repeatedly charged for the same transaction. Bank of America also offered people cash rewards and bonus points when signing up for a card, but the CFPB said the bank illegally withheld promised credit card account bonuses. Since at least 2012, Bank of America employees illegally applied for and enrolled consumers in credit card accounts without their knowledge or authorization, 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 in a statement. "These practices are illegal and undermine customer trust." In 2014 the CFPB ordered Bank of America to pay $727 million for illegal credit card practices. Last year it was ordered to pay a $10 million civil penalty over unlawful garnishments. Also in 2022, the CFPB and OCC fined Bank of America $225 million and required it to pay hundreds of millions of dollars in redress to consumers for botched disbursement of state unemployment benefits at the height of the COVID-19 pandemic.

(More Bank of America stories.)