On July 11, 2023, the Consumer Financial Protection Bureau (CFPB) issued a consent order against Bank of America (BoA) based on the CFPB’s findings that BoA had engaged in unfair and deceptive trade practices. This consent order comes as no surprise considering in just March, the CFPB released a special edition Supervisory Highlights report, which focused on “junk fees.” As previously explained, from the CFPB’s perspective, junk fees refer to fees that are charged to consumers without providing any clear benefit to them.

Regarding this recent consent order, the CFPB purported that BoA “deployed a double-dipping scheme to harvest junk fees” wherein BoA implemented a policy of charging consumers $35 after declining a transaction as an NSF fee. While an NSF fee may appear benign at first glance, the CFPB also found that BoA would allow the same fee to be charged multiple times for the same transactions. This alleged “double-dipping” policy continued for years, which improperly benefited BoA by increasing revenue from the illegal junk fee charges.

The CFPB also found that BoA had opened consumer credit card accounts without obtaining consent from each individual consumer. Doing so would have been in violation of the Fair Credit Reporting Act, the Truth in Lending Act, and the Consumer Financial Protection Act of 2010, because the bank had obtained consumer credit reports without a “permissible purpose.”

Additionally, the CFPB found that BoA engaged in deceptive acts or practices by advertising a “sign-up bonus” for a rewards credit card on its website (which made it appear as though anyone who applied would qualify), but later denying the bonus to individuals who applied over the phone or in person and not online. The CFPB also found that BoA actually offered the sign-up bonus for the rewards credit card to certain individual consumers but then failed to provide the promised bonus.

In the consent order, BoA does not admit or deny the factual findings by the CFPB.