via CBSNEWS:
NEW YORK – Federal regulators said Tuesday they found that Bank of America harmed customers by double-dipping on fees, withholding credit card rewards and opening fake accounts, all of which are violations of various consumer financial protection laws.
As a result, the Consumer Financial Protection Bureau ordered Bank of America (BAC) to pay more than $100 million to customers and $90 million in penalties. The Office of the Comptroller of the Currency also ordered Bank of America (BAC) to pay $60 million in fines.
Wells Fargo was doing this about 7 years ago.
via CBSNEWS:
Wells Fargo (WFC) has long touted its commitment to customers, with CEO John Stumpf noting a few years ago that it wants people to “see us as trusted financial advisers.” But that reputation could be in jeopardy given the bank’s recent financial penalties for abusive business practices.
On Thursday, Wells was hit with a record fine for covertly opening some 2 million unauthorized customer credit card and deposit accounts, draining real accounts to fund them, and charging fees for services the customers didn’t request.
“Wells Fargo employees secretly opened unauthorized accounts to hit sales targets and receive bonuses,” said Richard Cordray, Director of the Consumer Financial Protection Bureau. “Because of the severity of these violations, Wells Fargo is paying the largest penalty the CFPB has ever imposed.”
The CFPB’s action comes hard on the heels of revelations that the bank misapplied student loan payments to maximize fee income. Last month, the federal agency slapped a $3.6 million fine on the bank and demanded that it pay $410,000 in restitution to student loan borrowers who allegedly paid inflated fees and charges as the result of the bank’s improper actions. Wells Fargo settled the student loan action without admitting or denying guilt, saying that it disagreed with the CFPB but settled “to put the matter behind us.”