Compensation for Consumers
Out of the total settlement amount, Bank of America has agreed to pay over $100 million to the consumers who suffered as a result of these activities. The CFPB and OCC have both condemned the bank’s practice of “double-dipping on fees,” deeming it illegal. Consequently, Bank of America will pay $90 million in penalties to the CFPB and an additional $60 million to the OCC.
A Breach of Trust
CFPB Director Rohit Chopra has strongly denounced Bank of America’s actions, stating that the bank wrongfully withheld credit card rewards, engaged in fee manipulation, and opened accounts without customer consent. These unlawful practices not only harm customers but also erode trust in the banking system as a whole. Chopra has assured that the CFPB will take firm action to halt such practices across the industry.
Reforms from Bank of America
In response to these allegations, a spokesperson from Bank of America has highlighted the bank’s proactive measures. They have voluntarily reduced overdraft fees and completely eliminated all non-sufficient fund fees in the first half of 2022. As a result, revenue stemming from these fees has decreased by more than 90%.
Despite these legal troubles, Bank of America’s stock has shown resilience, with a 0.3% increase in premarket trades.