Bank of America has been fined $225 million by a pair of U.S. banking regulators over what they called a 'botched' handling of jobless benefits during the pandemic.
A Bank of America logo is pictured in the Manhattan borough of New York City, New York, U.S., January 30, 2019. REUTERS/Carlo Allegri/File Photohas been fined $225 million by a pair of U.S. banking regulators over what they called a "botched" handling of jobless benefits during the pandemic.
In addition to the fine, the regulators ordered the bank to pay redress to harmed consumers, which the CFPB estimated would amount to hundreds of millions of dollars more.As jobless claims surged during the pandemic, the CFPB said the bank, which administered prepaid jobless benefit debit cards on behalf of 12 states, implemented an automatic fraud filter, which resulted in thousands of cardholders having their accounts improperly frozen.
“Taxpayers relied on banks to distribute needed funds to families and small businesses to rescue the economy from collapse when the pandemic hit,” said CFPB Director Rohit Chopra. “Bank of America failed to live up to its legal obligations. And when it got overwhelmed, instead of stepping up, it stepped back.”
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