CFPB puts Bank of America under fake accounts microscope
US regulator the Consumer Financial Protection Bureau (CFPB) is looking into the possibility that Bank of America (BofA) has been opening customer credit card accounts without proper customer authorisation.
Documents posted online by the regulator showed that it had been investigating BofA since March 2019, when it issued a civil investigative demand (CID) that was issued as part of “an investigation into whether depository institutions or other persons had engaged in unlawful acts or practices in connection with unauthorised consumer bank, credit card, and other accounts.”
BofA has called the investigation “unnecessary”, “redundant”, and “unduly burdensome”
The CFPB requested four interrogatories, filed six requests for documents, and one request for a written report. BofA disagreed with the demands for emails and other records and petitioned the agency to close its investigation.
The bank, according to the CFPB documents, labelled the investigation “unnecessary”, “redundant”, and “unduly burdensome”. A lawyer from BofA also made reference to a “vanishingly small” number of “potentially unauthorised credit card accounts”. CFPB director, Kathleen Kraninger denied the petition in July.
Bank of America spokesman, Andy Aldridge, told the American Banker that the issues had been “thoroughly investigated” and the bank is working with regulators to confirm it has the right processes and controls in place.
This fresh probe was instigated on the tail-end of the Wells Fargo phony accounts scandal, in which the major US bank was suspected of opening 3.5 million customer accounts without authorisation.
The Office of the Comptroller of the Currency (OCC) opened a review into the sales practices of 40 major banks in the US following the scandal, and concluded in June 2018 that it had found examples of other banks opening accounts without the consent of their customers.
