Consumer complaint received 2024-04-26
Product: Checking or savings account — Checking account
Issue: Managing an account — Funds not handled or disbursed as instructed
Company: BANK OF AMERICA, NATIONAL ASSOCIATION (MD)

I am writing to bring to your attention a matter of significant concern regarding the treatment of consumers, particularly those who qualify for and receive government XXXX XXXX benefit payments through prepaid debit cards issued by the Bank of America. The issue at hand pertains to the definition of " Affected Consumers '' as outlined in the Consent Order issued by the Consumer Financial Protection Bureau ( CFPB ) on XX/XX/XXXX. 

Violation of Consumer Financial Protection Laws The Consent Order issued by the Consumer Financial Protection Bureau ( CFPB ) on XX/XX/XXXX, sheds light on several XXXX violations committed by [ XXXX ] in its administration of XXXX XXXX  benefit prepaid debit cards. These violations directly impact individuals who filed notices of error concerning alleged unauthorized electronic fund transfers ( EFTs ), thus warranting immediate attention and remedial action. 

XXXX XXXX XXXX XXXX XXXX is found to have engaged in unfair acts or practices, contravening XXXX XXXXXXXX and XXXX of the Consumer Financial Protection Act XXXX XXXX ( XXXX ), as well as provisions of the XXXXXXXX XXXX XXXX XXXX ( XXXX ) and XXXX XXXX The core infractions identified include : XXXX. Misuse of XXXX XXXX XXXX : XXXX unjustly determined the absence of error and froze cardholder accounts solely based on the outcomes of its automated XXXX XXXX, without conducting thorough investigations. This practice violates consumer protection statutes and undermines the rights of affected individuals. 

XXXX. Failure to Conduct Reasonable Investigations : XXXX neglected to conduct reasonable investigations into notices of error filed by unemployment insurance benefit prepaid debit cardholders, disregarding their entitlement to fair treatment and resolution of disputes under federal law. 

XXXX. Retroactive Application of XXXX XXXX : XXXX retroactively applied its automated XXXX XXXX to reverse permanent credits for cardholders, thereby subjecting them to unjust financial repercussions after previously investigating and paying their error claims. 

Abusive Acts or Practices Furthermore, XXXX is found to have engaged in abusive acts or practices by impeding cardholders ' efforts to file notices of error and seek liability protection from unauthorized EFTs. This obstruction hinders individuals from exercising their rights and exacerbates the harm caused by unauthorized transactions. 

Failure to Timely Investigate and Resolve Error Claims Respondent also failed to timely investigate and resolve notices of error concerning alleged unauthorized EFTs, further violating consumer protection laws and prolonging the distress experienced by affected individuals. 













Definition of Affected Consumers The Consent Order establishes a clear definition of " Affected Consumers, '' delineating specific criteria that individuals must meet to fall under this classification. According to the XXXX XXXX, an " Affected Consumer '' is someone who, during the Relevant Period : XXXX. Qualified for and received government unemployment insurance benefit payments electronically through prepaid debit cards issued by [ XXXX ]. 
XXXX. Filed a notice of error concerning alleged unauthorized XXXX Funds Transfers ( EFTs ) with XXXX. 
XXXX. Had XXXX incorrectly determine, based solely on the results of its XXXX XXXX, that no error occurred, resulting in the denial of the consumer 's error claim or the reversal of permanent credits previously granted to the consumer, and the freezing or blocking of the consumer 's unemployment insurance benefit prepaid debit card account. 

Supporting Evidence To substantiate my status as an " Affected Consumer '' under the terms of the Consent Order, I have provided documentation that confirms my eligibility for government unemployment insurance benefits and details the method of payment via a prepaid debit card issued by [ Respondent ]. Exhibit A, enclosed with this complaint, includes notices and records from the Department XXXX XXXX in the XXXX XXXX XXXX, demonstrating my receipt of benefits and the utilization of the prepaid card until XX/XX/XXXX. Additionally, payment history documents further attest to my eligibility. 



Bank of America 's Actions and Impact on Affected Consumers The enforcement action further delineates the actions taken by Bank of America in response to cardholders filing claims, shedding light on the severe repercussions experienced by affected individuals : Automatic Determination of No Error and XXXX XXXX XXXX XXXX Bank of America implemented a nationwide strategy from XX/XX/XXXX, to XX/XX/XXXX, whereby it automatically determined no error occurred and froze the unemployment insurance benefit prepaid debit card accounts of cardholders who filed notices of error meeting any of its XXXX XXXX indicators. This unilateral action was solely based on the outcomes of the XXXX XXXX, without due consideration for the validity of the claims or the financial well-being of the cardholders. 







Financial Hardship Endured by Affected Consumers As a result of Bank of America 's decision to freeze prepaid debit card accounts through its Fraud Filter, numerous cardholders endured prolonged periods without access to their unemployment insurance benefits. This deprivation of essential funds caused significant financial distress, with some individuals experiencing weeks, and in certain cases, months, of hardship. 

Consequences of Account Freezing The repercussions of Bank of America 's actions extended beyond mere inconvenience, as affected consumers faced a cascade of adverse consequences. Many incurred late fees and interest charges on their other accounts, exacerbating their financial burden. Moreover, some individuals missed critical payments for essential services such as phone and utility bills, further compounding their challenges. Additionally, the financial strain imposed by frozen prepaid debit card accounts precipitated more severe outcomes, including foreclosure, eviction, and car repossession. 


Contrast with Treatment of XXXX Cardholders The enforcement action provides insight into the distinct treatment afforded to XXXX cardholders in XXXX XXXX Bank of America, underscoring a stark contrast with the circumstances experienced by individuals in other states, including myself : XXXX for XXXX XXXX Bank of America generally required XXXX cardholders with frozen XXXX prepaid debit card accounts to reverify their identity through XXXX, rather than with Bank of America, to regain access to their accounts. This approach placed a significant burden on cardholders, particularly given the challenges faced by XXXX in handling the influx of identity verification requests. 

Lack of Communication and XXXX Bank of America failed to inform XXXX of its intention to implement a fraud filter and freeze unemployment insurance benefit prepaid debit card accounts, exacerbating the challenges faced by affected individuals. Moreover, until XX/XX/XXXX, the only exception to Bank of America 's requirement for identity reverification through XXXX was limited to cardholders who filed complaints asserting specific hardships through designated channels Personal Experience : Request for Expedited Verification In contrast to the accommodations extended to XXXX cardholders, my experience with Bank of America was marked by significant hardship and bureaucratic hurdles. On XX/XX/XXXX, Bank of America froze my account, citing directives from the Department XXXX XXXX in the XXXX XXXX XXXX  Subsequently, I initiated efforts to expedite the verification of my identity due to a severe and immediate financial hardship. 







Engagement with State Delegates and Department XXXX XXXX XXXX I engaged in XXXX separate discussions with state delegates, including XXXX XXXX XXXX and her Chief of Staff XXXX XXXX, to submit requests for expedited identity verification. These discussions, aimed at restoring my benefits after Bank of America 's account freeze, underscore the extraordinary measures I undertook to navigate the challenges imposed by the bank 's actions. 

Furthermore, correspondence with Department XXXX XXXX XXXX, XXXX XXXX and XXXX XXXX, documents their assistance in restoring my benefits following the account freeze by Bank of America. 




Violation of Federal Law : Findings and Conclusions The findings and conclusions outlined in the Consent Order issued by the Consumer Financial Protection Bureau ( CFPB ) underscore the universal application of the enforcement action and its non-discriminatory nature across state borders : Cause : Respondents Strategy as Applied to XXXX XXXX Bank of America 's strategy, implemented from XX/XX/XXXX, to XX/XX/XXXX, indiscriminately affected XXXX cardholders XXXX XXXX. This strategy, characterized by the automatic determination of no error for notices of error concerning alleged unauthorized electronic fund transfers ( EFTs ) and subsequent freezing of cardholders ' XXXX prepaid debit card accounts, caused substantial injury to consumers, irrespective of their geographic location. 

Consequence : Findings and Conclusions as to Respondents Strategy in XXXX ( Unfair Practice ) The enforcement action conducted by the CFPB concluded that Bank of America 's strategy in XXXX described above, constituted unfair acts or practices under federal law. Sections XXXX and XXXX of the XXXX XXXX XXXX XXXX ( XXXX ) prohibit covered persons from engaging in any unfair, deceptive, or abusive acts or practices in connection with consumer financial products or services. Bank of America 's actions, which caused substantial injury to XXXX cardholders, were found to be in violation of these provisions. 


XXXX XXXX of XXXX XXXX It is crucial to recognize that the enforcement action transcends state borders and is not discriminatory from state to state. The violations identified by the CFPB, rooted in federal law, apply universally to all covered persons, irrespective of the jurisdiction in which the violations occurred. This underscores the imperative for consistent regulatory oversight and enforcement to safeguard consumer rights and maintain the integrity of the financial system nationwide. 


By highlighting the universal application of the enforcement action and the non-discriminatory nature of federal law, this section emphasizes the need for comprehensive regulatory intervention to address systemic deficiencies and ensure equitable treatment for all affected consumers. 


Violation of Consent Order : Failure to Provide Redress in accordance with the Redress Plan Despite the issuance of a Consent Order by the Consumer Financial Protection Bureau ( CFPB ) and the identification of affected consumers, including myself, Bank of America has willfully failed to comply with the provisions outlined therein, thereby perpetuating the harm caused by its actions : Failure to XXXX XXXX XXXX Bank of America has neglected its obligation to notify affected consumers, such as myself, of their status as " Affected Consumers '' under the Consent Order. Despite clear evidence demonstrating my eligibility for redress, including documents confirming receipt of unemployment insurance benefits via Bank of America 's prepaid debit card, the bank has failed to fulfill its duty to inform me of my rights under the XXXX. 

Failure to Provide Consequential Harm Payment Furthermore, Bank of America has failed to provide consequential harm payments to affected consumers, including myself, as required by the Consent Order. Despite explicit provisions mandating compensation for related consequential harm, the bank has neglected to fulfill this obligation, exacerbating the financial hardships endured by affected individuals. 

XXXX XXXX XXXX XXXX XXXX XXXX Bank of America 's non-compliance with the XXXX XXXX is a direct violation of the provisions outlined therein. Specifically, the bank has failed to adhere to the requirements stipulated in the XXXX XXXX, including the identification of affected consumers, calculation of remediation amounts, establishment of an individualized review process, and issuance of redress payments. 


Moreover, Bank of America has neglected to develop communication protocols and tracking procedures for redress payments to affected consumers, further evidencing its disregard for the terms of the XXXX XXXX. The absence of clear communication channels and accountability mechanisms exacerbates the challenges faced by affected individuals seeking resolution. 


Bank of America 's persistent failure to comply with the XXXX XXXX and provide redress to affected consumers, as mandated by federal law, is XXXXXXXX and unacceptable. The bank 's continued obstruction of the compliance process perpetuates the XXXX  caused by its actions and underscores the urgent need for regulatory intervention to enforce accountability and safeguard consumer rights. 

Violation of Consent Order : Failure to Provide Redress Despite the issuance of a Consent Order by the Consumer Financial Protection Bureau ( CFPB ) and the identification of affected consumers, including myself, Bank of America has willfully failed to comply with the provisions outlined therein, thereby perpetuating the harm caused by its actions : Failure to Provide Redress as Mandated by XXXX XXXX Bank of America 's non-compliance with the Monetary Provisions outlined in the Consent Order is particularly XXXX. The bank has neglected its obligation to pay redress to affected consumers, including myself, as mandated by specific provisions ( XXXX  XXXX, Orders to Pay Redress, XXXXXXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX ). Despite clear directives from regulatory authorities, Bank of America has failed to fulfill its duty to provide compensation for the harm caused by its actions. 

Request for Affidavit and Inadequate Response Furthermore, Bank of America 's request for an affidavit regarding claims filed in XXXX, which the bank inaccurately processed despite extensive communication and documentation, is deeply concerning. Despite spending considerable time addressing these claims, providing detailed explanations, and submitting multiple reconsideration requests, the bank has failed to provide adequate redress. This request for an affidavit serves as yet another example of the bank 's disregard for the severity and impact of its actions on affected consumers. 

Interactions with XXXX XXXXXXXX and XXXX  Department My interactions with XXXX  XXXX from the XXXX Department further highlight Bank of America 's dismissive attitude towards providing redress for the consequential harm suffered by affected consumers. Despite the existence of extensive notes on my account detailing the grievances and hardships endured as a result of the bank 's actions, XXXX XXXX questioned my eligibility for compensation and failed to acknowledge the documented evidence of consequential XXXX. Recordings of these conversations attest to the bank 's reluctance to fulfill its obligations under the XXXX XXXX and its disregard for the well-being of affected individuals. 

Violation of Consent Order : Continued Disregard for Regulatory Mandates In a flagrant display of disregard for regulatory mandates and consumer rights, Bank of America froze my account again on XX/XX/XXXX, despite the closure of the account and the issuance of the Consent Order by the Consumer Financial Protection Bureau ( CFPB ). This latest incident underscores the bank 's persistent failure to adhere to regulatory directives and its ongoing disregard for the well-being of affected consumers. 

False Attribution of Actions to XXXX XXXX  XXXX XXXX XXXX XXXX Bank of America falsely attributed its actions to the XXXX XXXX  XXXX XXXX, falsely stating that the Department directed the freezing of my account. However, the XXXX XXXX XXXX XXXX has vehemently denied this allegation, highlighting the bank 's deceptive practices and attempts to shift blame for its own misconduct. 

Pattern of Non-Compliance and Disregard for Consumer Rights This latest incident is emblematic of Bank of America 's pattern of non-compliance with regulatory orders and its continued disregard for consumer rights. Despite clear directives from regulatory authorities and documented evidence of its misconduct, the bank has persisted in its negligent and harmful practices, further exacerbating the financial hardships faced by affected consumers. 

Urgent Need for XXXX Intervention The repeated instances of non-compliance and deceptive practices by Bank of America underscore the urgent need for regulatory intervention to hold the bank accountable for its actions and ensure the protection of consumer rights. It is imperative that regulatory authorities take swift and decisive action to enforce compliance with the XXXX XXXX and prevent further harm to affected individuals. 

Bank of America 's continued disregard for regulatory mandates and deceptive practices represent a grave violation of consumer rights and a blatant disregard for the rule of law. The bank 's false attribution of actions to the XXXX XXXX XXXX XXXX and its pattern of non-compliance underscore the urgent need for regulatory intervention to hold the bank accountable and ensure justice for affected consumers.