BAC Bank of America Corporation

By Will Feuer

The Consumer Financial Protection Bureau said it has ordered Bank of America to pay $250 million in penalties and restitution to harmed consumers for double-dipping on certain fees, among other matters.

"Bank of America wrongfully withheld credit card rewards, double-dipped on fees, and opened accounts without consent," CFPB Director Rohit Chopra said. "These practices are illegal and undermine customer trust. The CFPB will be putting an end to these practices across the banking system."

Bank of America previously had a policy of charging customers $35 after the bank declined a transaction because the customer didn't have enough funds in their account. For years, though, the bank "double-dipped" by repeatedly charging fees for the same transaction, the CFPB said.

Last year, Bank of America reduced its overdraft fees to $10 and eliminated all non-sufficient fund fees.

"We voluntarily reduced overdraft fees and eliminated all non-sufficient fund fees in the first half of 2022," a spokesman said. "As a result of these industry leading changes, revenue from these fees has dropped more than 90%."

The CFPB said the bank also withheld promised credit card account bonuses to tens of thousands of consumers. Bank of America employees also illegally applied for and enrolled consumers in credit card accounts without consumers' knowledge or authorization since at least 2012 to reach now-disbanded incentive goals, according to the CFPB.

To resolve the matters, Bank of America will pay more than $100 million to harmed consumers, as well as $90 million in penalties to the CFPB and $60 million to the Office of the Comptroller of the Currency.

Write to Will Feuer at Will.Feuer@wsj.com

(END) Dow Jones Newswires

July 11, 2023 09:16 ET (13:16 GMT)

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