Bank Of America Fined $150m, to Pay $100m to Customers for ‘Double-Dipping’ Fees, Fake Accounts

The Consumer Financial Protection Bureau (CFPB) has ordered Bank of America (BOA) to pay $150 million in fines and reimburse customers in Pennsylvania and other states more than $100 million, the Associated Press reported on Tuesday, July 11.

“Bank of America wrongfully withheld credit card rewards, double-dipped on fees, and opened accounts without consent,” CFPB Director Rohit Chopra said in a statement. “These practices are illegal and undermine customer trust”, the report said.

According to the report, part of the fines and penalties come because Bank of America had a policy of charging customers $35 after the bank declined a transaction because the customer did not have enough funds in their account, the CFPB said. The agency determined that the bank double-dipped by allowing fees to be repeatedly charged for the same transaction.

The fees often came when customers had routine monthly transactions, like a gym membership. If a customer had too low of a balance to cover the transaction, it would be declined and BofA would charge the customer a $35 fee. The business, who hasn’t been paid, often would recharge the customer’s account, resulting in another $35 non-sufficient funds fee.

Consumerfinance.gov reported that “Bank of America harmed hundreds of thousands of consumers over a period of several years and across multiple product lines and services,” specifically, a double-dipping scheme to harvest junk fees, withholding cash and points rewards on credit cards, and misusing sensitive customer information to open unauthorized accounts.

The CFPB said that customers don’t need to take action; banks will either put funds back in consumer accounts or send a check. Full details, including the amount of refunds for individual customers and how exactly they will be paid, have not yet been released.

There are more than 50 Bank of America financial centers and ATMs in Pennsylvania.