Bank of America Fined for Unlawful Garnishments
Consumer Bureau action imposes $10 million fine on one of nation’s largest banks
The Consumer Financial Protection Bureau (CFPB) has fined Bank of America $10 million for the bank’s unlawful processing of out-of-state garnishments.
The CFPB notes that the bank acted unlawfully in processing garnishment orders and harmed customers by taking money from accounts without following the proper process.
According to the CFPB, Bank of America unlawfully froze customer accounts, charged garnishment fees, garnished funds, and sent payments to creditors based on out-of-state garnishment court orders that should have been processed under the laws and protections of the states where the consumers lived. Bank of America also violated the law by inserting unfair and unenforceable language into customer contracts that purported to limit customers’ rights to challenge garnishments.
“Bank of America imposed unlawful garnishment fees and injured its customers by inserting unenforceable clauses into contracts in an attempt to strip legal rights from families,” said Rohit Chopra. “The CFPB is ordering Bank of America to fix its systems, clean up its contracts, and make its victims whole.”
