Bank of America Slammed With $250 Million Fine for Opening Fake Accounts, Double-Dipping Charges — Here's How to Find Out If You Qualify for Payment At least as far back as 2012, bank employees created unauthorized credit card accounts in customers' names to boost sales and better evaluations.
By Amanda Breen Edited by Jessica Thomas
Key Takeaways
- The Consumer Financial Protection Bureau ordered Bank of America to pay more than $100 million to customers
- Wells Fargo also faced a hefty fine for opening fake credit card accounts back in 2016
- Some affected customers have been paid, but others are still waiting
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Bank of America, the second-largest bank in the U.S., violated multiple consumer financial protection laws, federal regulators said Tuesday, and now the bank owes the many customers and agencies it harmed a lot of money.
Bank of America must pay roughly $250 million in total for double-dipping on fees, not distributing credit card rewards and opening fake accounts, CNN Business reported.
Related: Bank of America to Slash Overdraft Fees, Experts Call the Move 'Brilliant'
Customers were "repeatedly charged" $35 if their transaction was declined due to insufficient funds, even if a third-party merchant submitted the same charge again — costing customers "tens of millions of dollars in fees on resubmitted transactions," the Office of the Comptroller of the Currency said.
Additionally, Bank of America withheld cash and points from its credit card members and, beginning at least as far back as 2012, bank employees "illegally applied for and enrolled consumers in credit card accounts without consumers' knowledge or authorization" to meet goals and better their evaluations.
Similarly, Wells Fargo employees were found to have been opening unauthorized accounts on behalf of customers for years back in 2016; the bank was ordered to pay $185 million in fines, including a $100 million penalty from the Consumer Financial Protection Bureau, The New York Times reported.
The Consumer Financial Protection Bureau ordered Bank of America to pay more than $100 million to customers and $90 million in penalties, and the Office of the Comptroller ordered the bank to pay $60 million in fines, per CNN.
Related: This Historical Indicator Makes Buffett's Bank of America a Buy
Credit card customers who did not receive rewards have already been paid, but customers impacted by the double-dipping fees and unauthorized accounts don't need to take any action currently, as Bank of America will send payments to anyone who qualifies and a point of contact will be live on its site later this month, according to the outlet.
