Bank of America has officially been ordered to pay $250 million for charging illegal fees to its users and opening up credit-card accounts without customer consent. Indeed, the Consumer Financial Protection Bureau (CFPB) has ordered a financial penalty for actions taken by the bank.
The Wall Street Journal reported the penalty and restitution payments levied against the financial institution. Moreover, the regulator has collected the fine in connection with a host of different infractions, including false accounts that were opened, and various wrongful fees.
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Bank of America to Pay $250 Million by Regulator
One of the largest banks in the country has been issued a host of fees in connection with various infractions it has committed. Specifically, Bank of America has been ordered to pay $250 million by the CFPB due to illegal fees, and opening credit-card accounts without customer consent.
The CFPB Director, Rohit Chopra, discussed the fines that have been issued to the bank. “Bank of America wrongfully withheld credit card rewards, double-dipped on fees, and opened accounts without consent,” he stated. “These practices are illegal and undermine customer trust. The CFPB will be putting an end to these practices across the banking system.”
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The bank had instituted a policy that charged customers $35 for a declined transaction. This was supposedly enacted because the customers didn’t have enough money in their accounts. However, the CFPB states that the bank has “double-dipped” by repeatedly charging fees. Moreover, the action has taken place for years.
Last year, Bank of America reduced its overdraft fees to $10. Additionally, it had eliminated all non-sufficient fund fees, according to the report. Conversely, the CFPB states that it withheld credit-card account rewards from “tens of thousands of customers.” Moreover, employees had been illegally applying to customers for credit card accounts without their consent.
Now, Bank of America will pay more than $100 million to customers, to make things right. Additionally, they will pay $90 million in fines to the CFPB, and $60 million to the Office of the Comptroller of the Currency.