CHARLOTTE — Bank of America has been ordered to pay $12 million over accusations it didn’t provide the correct mortgage information to the government.
According to the Consumer Financial Protection Bureau, the bank failed to ask some of its mortgage applicants specific demographic questions, saying the applicants chose not to respond. This happened over a period of at least three months.
The CFPB said in addition to saying applicants declined to share the information, Bank of America also failed to “adequately oversee accurate data collection.”
“For example, the bank identified that many loan officers receiving applications by phone were failing to collect the required data as early as 2013, but the bank turned a blind eye for years despite knowledge of the problem,” the CFPB said.
Federal law requires the questions to be asked. Lenders are required by the 1975 Home Mortgage Disclosure Act to share loan application information with the CFPB and other federal regulators. That data is when used to determine whether banks have met the housing needs in their communities, and also to detect any discriminatory lending practices.
CFPB ordered Bank of America to pay $12 million into the bureau’s victim relief fund.
Back in July, regulators ordered Bank of America to pay more than $250 million for doubling up on customer fees, withholding reward bonuses for credit card customers and opening accounts without authorization, according to the CFPB.
A year earlier, our partners at The Charlotte Observer reported the bank was fined $225 million for mishandling the way it gave out unemployment benefits during the pandemic. They also said the bank’s fraud detection froze accounts for thousands of out-of-work Americans.
Bank of America, which is headquartered in Charlotte, is also the second-largest bank in the country.
In a statement, Bank of America responded to the CFPB’s allegations:
“We properly collected demographic data in more than 99 percent of applications in the years reviewed by the CFPB and consistently had lower percentages of applicants not disclosing their race compared to annual industry averages,” a bank representative told Channel 9. “After receiving one complaint in 2020, we conducted a review and notified the government, which prompted this inquiry. As the CFPB notes, we took additional steps in 2020 and 2021 to enhance our monitoring and training to ensure employees ask applicants for required racial, ethnic and gender information. This data collection issue had no impact on applications.”
The Cox Media Group National Content Desk contributed to this report.
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