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OCC Fines Bank of America with $30 Million, Requires them to Make Amends with 73,000 Customers

OCC Fines Bank of America with $30 Million, Requires them to Make Amends with 73,000 Customers

While there are plenty of laws designed to protect consumers from unsavory lending and collecting practices, harmful and unfair collection often goes unpunished.  Banks can and do get away with harming their customers every day — so when one gets caught and fined, it is big news.

Bank of America was hit with a hefty fine last week for violating the terms of the Servicemembers Civil Relief Act (SCRA). The SCRA’s goal is to protect service members who were deployed by preventing banks from taking negative financial actions aimed against these members of the Armed Forces.

Banks who take harmful and unfair steps to jeopardize the financial well-being of service members are subject to harsh penalties; BOA found this out the hard way. By violating the rights and accounts of over 73,000 service members, the Bank of American ran afoul of the SCRA law and has been fined 30 million dollars for their violations against the men and women who protect our country from harm.

According to the Office of the Comptroller of the Currency.  Bank of America must take two actions to atone for their violations. They must pay the specified fine and also make amends with the 73,000 customer accounts they violated.

The OCC investigation charged the bank with violating the SCRA by using unsavory and unfair debt collection practices against service members. When a person is deployed to serve the country in another place, a war zone, relief mission or other long term engagement, they are supposed to be rewarded instead of being harmed financially back home.

When financial institutions like Bank of America proceed with unfair collections practices — often suing or foreclosing while these service people were far from home — they violate both the letter and the spirit of the law.

The violations range as far as a decade back; Bank of America has been routinely violating the SCRA by pursuing military customers for credit card accounts, overdrafts and fees. Since 2006, the bank trampled the rights of veterans and active service people, leaving devastation, lost homes and broken dreams in their wake.

The violations were system wide, with BofA’s employees claiming to have personal knowledge of delinquent accounts and customers and acting accordingly, even though they were in clear violation of the laws designed to protect deployed members of the Armed Forces from financial harm.

In some cases, lawsuits were filed against deployed service members without proper documentation, according to the OCC filing. In other cases. homes were foreclosed upon, debts were sold and items were repossessed. In almost all cases, the military service person’s personal credit file, rating and score were harmed, impacting their ability to secure loans for homes, cars and other items.

The filing also alleged that the Bank of American hired unsupervised third party collectors and attorneys and neglected to oversee their actions or take responsibility for harmful actions or outcomes.

In addition to paying the fine and making restitution to impacted military members, the Bank of America is required to review and update its SCRA policies and ensure compliance. They also have to correct the accounts of impacted military members and provide truthful and correct accounting of the affected customers accounts and judgments.

Even though they were heavily sanctioned and fined, the bank refused to acknowledge any wrong doing at all. According to the New York Times, Bank of America refused to admit they were at fault, but issued statement that they would be reviewing their policies and amending their compliance to the SCRA in the future.

While this fine and the related adjustments come too late to the 73,000 servicemen and women harmed by Bank of America’s negligent SCRA practices, it serves as a warning to other banks and protects the future rights of military members.

Hopefully it will serve as a wake up call to other institutions and prevent them from harming protected classes of customers. Consumers can consider this a victory against a bank that knowingly and deliberately violated customer rights and protections under the SCRA.

Are you also a victim of a similar abuse by these big banks and lenders? We can help you fight back. Call us today at 866-4-WAY-OUT (866-492-9688) or send us an email and learn about your options.

  • hemant kumar arya

    Awesome post. You made my day. I just love your way of writting. This post is really helpfull and helped me alot. So I just wanna say thank to you…!!
    Thank you 😀

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