many people are really closely scrutinizing which credit card they sign up for based on rewards, whether it's cash, bonuses at enrollment, or airline points, or other proprietary point systems," Chopra said. ![]() However, according to the CFPB, Bank of America illegally withheld those bonuses from tens of thousands of customers.Ĭhopra said Bank of America has been ordered to follow through on those promises. The CFPB said Bank of America targeted potential-customers by offering special cash and point rewards if they signed up for a credit card, a common signing bonus used by competing credit card companies. Withholding credit card cash and point rewards The bank also dropped the overdraft fee from $35 to $10 in May 2022. She said the changes have resulted in a drop in revenue from these fees of over 90%. Patton told NPR that the bank voluntarily reduced overdraft fees and eliminated "all non-sufficient fund fees" in the first half of 2022. We expect banks to conduct their activities in compliance with all applicable laws and standards, and when they don't, we will act accordingly."īank of America Senior Vice President of Media Relations Naomi R. "Today's action demonstrates the OCC's commitment to protecting consumers and promoting fairness and trust in banking. ![]() "Overdraft programs should help, not harm, consumers," Acting Comptroller of the Currency Michael J. The OCC said it found that the bank charged "tens of millions of dollars" in fees in resubmitted transactions, in violation of Section 5 of the Federal Trade Commission Act, which prevents financial institutions from using unfair or deceptive acts and practices. It did so by charging people $35 whenever they didn't have enough funds available, but repeatedly charged customers for the same transaction, which the CFPB said generated "substantial additional revenue".Ĭhopra told NPR Business Correspondent David Gura, "Building a business model by double dipping on fees is simply not legal, and that's why we've sanctioned Bank of America and ordered them to pay back the customers they cheated." Bank of America's "double-dipping scheme"Īccording to the CFPB, Bank of America utilized a "double-dipping scheme" to "harvest junk fees" from customers. A separate $60 million fine has been ordered by the Office of the Comptroller of the Currency for violating laws around overdraft fees.ĬFPB Director Rohit Chopra said in a news release that Bank of America's double-dipping on fees, opening accounts without customer consent and withholding rewards "are illegal and undermine customer trust," practices he said the CFPB will put an end to across the banking system. As a result, Bank of America was ordered to pay over $100 million to customers and another $90 million in penalties. The Consumer Financial Protection Bureau announced Tuesday that an investigation found that Bank of America harmed hundreds of thousands of customers across multiple product lines over a period of several years through a series of illegal practices. The bank is also on the hook for an additional $150 million in penalties for the same violations. ![]() Bank of America, one of the nation's largest banks, is being ordered to pay more than $100 million to customers and $150 million in fines for illegally charging customers for junk fees, fake accounts and withholding rewards.īank of America, the nation's second largest bank, has been ordered to pay more than $100 million to customers for double charging insufficient fund fees, withholding reward bonuses and opening accounts without customers' knowledge or permission.
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