Just Another Big Bank Scandal
Bank of America to pay $250 million fine — but no one will go to jail
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It’s another day.
Why not another scandal involving one of America’s largest banks?
It seems Bank of America was double-dipping on overdraft fees and opening new accounts without customer permission.
Now, they will be fined and have to repay customers. But that’s it.
No BofA execs will face jail time. The company will pay the fine and keep doing business.
And it’s business as usual — BofA has paid more than $1 billion in fines, penalties, and customer reimbursements as a result of illegal activity since 2014.
The findings of the CFPB investigation indicate that Bank of America failed to credit promised credit card rewards — essentially keeping money promised to customers. The bank also charged overdraft fees ($35 each) multiple times for the same transaction, resulting in millions of dollars in illegally-gained profit at the expense of customers. The bank also opened new accounts for existing customers without informing the customer or receiving their consent.
The benefits withheld from customers and the illegal fees totaled $100 million, which Bank of America must now pay to the impacted customers. Additionally, Bank of America will pay a total of $150 million in civil penalties for their illegal activity.
U.S. Senator Sherrod Brown, who chairs the Senate committee with oversight of the banking industry, lamented the findings:
“Bank of America has clearly broken the law in yet another case of Wall Street banks taking Americans’ money to pad their already-massive profits. This is just the latest in a long line of illustrations of why we can’t trust Wall Street to do the right thing,” said Brown. “This kind of abuse is why we will continue to hold the big banks accountable, and it’s why we need the CFPB — so consumers can keep their hard-earned money.”
