Bank of America is paying $772 million in refunds and fines to settle allegations that it illegally misled millions of customers with deceptive credit card practices, regulators said Wednesday.
The Consumer Financial Protection Bureau said that Bank of America illegally deceived 2.9 million customers into buying extra credit card services and charged others for credit monitoring between 2000 and 2012, the New York Times reported.
The bank will pay an additional $20 million penalty to the Consumer Financial Protection Bureau and $25 million to the Office of the Comptroller of the Currency.
The deal is the largest refund amount ordered to date by the 3-year-old CFPPB, and is the biggest settlement over credit card “add-ons” won by the federal government, reports the Associated Press.
“Bank of America both deceived consumers and unfairly billed consumers for services not performed,” said Richard Cordray, director of CFPB. “We will not tolerate such practices and will continue to be vigilant in our pursuit of companies who wrong consumers in this market.”
Bank of America didn’t admit or deny the accusations, but a statement from the bank said that it had “stopped marketing identity theft protection products in December 2011 and credit card debt cancellation products in August 2012.” The bank also said that it had refunded “the majority” of affected customers.
The CFPB said that from 2000 to 2011, the Charlotte, N.C.-based bank charged nearly 1.9 million customers a total of $459 million for numerous identity-protection products without getting their authorization.
From 2010 to 2012, the bureau claims Bank of America representatives misled customers about the real cost of credit card debt-cancellation products bought as protection in instances of unemployment, disability, retirement or start of college.