Bank of America has been ordered by the Consumer Financial Protection Bureau (CFPB) to pay a $12 million penalty for submitting false mortgage lending information to the federal government, according to documents released by the CFPB.
The bank failed to ask certain demographic questions required under federal law for at least four years and falsely reported that applicants had chosen not to respond. This violated the Home Mortgage Disclosure Act (HMDA), its implementing regulation, Regulation C and the Consumer Financial Protection Act. The bank also failed to adequately oversee accurate data collection, with many loan officers receiving phone applications failing to collect required data as early as 2013.
The bank must pay $12 million into the CFPB's victims relief fund. The HMDA, enacted in 1975, requires mortgage lenders to report information about loan applications and originations to the CFPB and other federal regulators.
“Bank of America violated a federal law that thousands of mortgage lenders have routinely followed for decades,” said CFPB Director Rohit Chopra. “It is illegal to report false information to federal regulators, and we will be taking additional steps to ensure that Bank of America stops breaking the law.”
According to the press release, the CFPB has taken several actions against Bank of America for violating federal law, including over $200 million in July 2023 for illegally charging junk fees, withholding credit card rewards and opening fake accounts. In 2022, the CFPB and OCC ordered Bank of America to pay $225 million in fines and refund hundreds of millions of dollars to consumers for botched disbursement of state unemployment benefits. In 2014, the CFPB ordered Bank of America to pay $727 million to consumers for illegal and deceptive credit card marketing practices.
