The Consumer Financial Protection Bureau (CFPB) ordered Bank of America to pay more than $250 million after the company “wrongfully withheld credit card rewards, double-dipped on fees, and opened accounts without consent,” according to CFPB Director Rohit Chopra.
“Bank of America employees illegally applied for and enrolled consumers in credit card accounts without consumers’ knowledge or authorization,” the CFPB said.
Employees “illegally used or obtained consumers’ credit reports, without their permission, to complete applications” and “consumers were charged unjustified fees, suffered negative effects to their credit profiles, and had to spend time correcting errors,” the CFPB described.
These practices are illegal and undermine customer trust. The CFPB will be putting an end to these practices across the banking system,” Chopra continued.
Consumers affected by the practices are owed more than $100 million.
Bank of America will also pay $90 million in penalties to CFPB and $60 million to the Office of the Comptroller of the Currency.
The bank released a statement saying it “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 offered no comment on the idea that it opened fake accounts.
Reporting from Fox Business:
The CFPB also accused the bank of illegally withholding "promised credit card account bonuses, such as cash rewards or bonus points to tens of thousands of consumers" who submitted applications over the phone or in person. Regulators also accused the bank of denying "sign-up bonuses to consumers due to the failure of Bank of America’s business processes and systems."
