The Consumer Financial Protection Bureau (CFPB) on Tuesday announced it is ordering Bank of America to pay $12 million in fines for violating federal laws related to mortgage disclosure.
In a consent order, the CFPB said that Bank of America routinely submitted inaccurate information about mortgage applicants to the federal government over the past four years.
According to the bureau, more than 400 loan officers for the bank failed to ask applicants questions about their race, ethnicity, and sex, all of which are required by federal law and have been followed by mortgage lenders for decades. Instead, the bank's loan officers falsely reported that applicants chose not to respond to the questions.
In addition, the CFPB claimed that Bank of America knew that its loan officers had been failing to collect the required data since at least 2013 but refused to take action to address the problem until 2021.
Both acts violated the 1975 Home Mortgage Disclosure Act (HMDA). The law requires lenders to publicly report information about mortgages to expose potentially discriminatory lending practices.
"Bank of America violated a federal law that thousands of mortgage lenders have routinely followed for decades," CFPB Director Rohit Chopra said in a press release. "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."
Bank of America did not admit or deny the CFPB's findings.
Previous Violations
The CFPB has previously fined Bank of America for other alleged violations. In July, the CFPB and the Office of the Comptroller of the Currency (OCC) ordered the bank to pay over $200 million for illegally charging customers junk fees, withholding their credit card rewards, and misappropriating personal information to open fake accounts without authorization.
In 2022, the banking giant was ordered to pay a fine of $225 million and refund hundreds of millions of dollars to customers after it botched the disbursement of unemployment benefits during the COVID-19 pandemic. Additionally, they also unlawfully froze people's accounts due to a faulty fraud detection program.
That same year, the CFPB fined Bank of America $10 million after it processed illegal, out-of-state garnishment orders against its customer's bank accounts.
