Bank of America Fined Hundreds of Millions Due to Consumer Violations

Bank of America Fined Hundreds of Millions Due to Consumer Violations

Date:

As of Tuesday morning, Bank of America (BofA) bears an unfavorable image after agreeing to a $250 million settlement, which includes $150 million in penalties and an additional $100 million in consumer compensation. Complaints of using credit cards without authorization, charging excessive fees, and unfairly withholding incentives led to the settlement. US regulatory agencies made these assertions. The Consumer Financial Protection Bureau (CFPB) levied the sanction in retaliation for the bank repeatedly and consistently charging fees on accounts with inadequate cash. In addition, the CFPB claimed that the bank had signed up consumers for new cards without getting their permission or knowledge and had failed to deliver the promised credit card reward bonuses.

The $150 million penalty is divided into two parts: the CFPB will receive $90 million and the Office of the Comptroller of the Currency will receive $60 million. According to Bloomberg, the bank did not admit or deny the accusations when the matter was settled. The director of the Consumer Financial Protection Bureau (CFPB), Rohit Chopra, stated in a statement on Tuesday that Bank of America had wrongfully held back credit-card incentives, charged double fees, and created new accounts without the required authorizations. Such actions, according to Chopra, are illegal and undermine client trust. According to their statement, the CFPB showed that Bank of America charged customers a $35 overdraft fee and permitted numerous charges for the same transaction, a practice known as “double-dipping.” In response, Bank of America said that during the first half of 2022, it voluntarily decreased overdraft fees and altogether eliminated all non-sufficient fund fees. BofA did not, however, address the circumstances or the claims leveled against the bank.

U.S. Senator Elizabeth Warren (D-MA) criticized the procedures, commenting that the practices  “snatch billions from struggling families” along with other negative remarks. After all of the negative feedback that BofA received, the bank agreed to reduce the fees assessed to customers for not having enough money to clear check and debit-card charges in the early months of 2022.

Liam Fegan
Liam Fegan
Lockheed Martin Financial Analyst since June of 2018. If you want a better life, raise your standards and don't compromise them.
- Sponsor -spot_img
- Sponsor -spot_img

Week's Top Stories

More In This Category
Related

Russian Warships Dock at Libyan Port Tobruk

Two ships belonging to Russia's Pacific Fleet—the Varyag missile...

Tensions Mount as IDF Prepares for Potential Lebanon Offensive

Hezbollah Secretary General Hassan Nasrallah has declared that in...

Identifying a Correlation Between Economic Downturn and Rising Populism

The Economics of Populism Over the past decade, there has...

American Soldier Sentenced to Nearly Four Years in Russian Penal Colony

A United States Army staff sergeant, Gordon Black, has...