Bank of America has been ordered to pay a fine of $12 million by the Consumer Financial Protection Bureau for submitting inaccurate mortgage information to federal authorities.
According to the CFPB, loan officials at the bank failed to ask mortgage applicants some demographic questions as required by law. And then, they reported as if the customers chose not to respond to those questions.
Bank of America "turned a blind eye for years despite knowledge of the problem," the CFPB said in a statement.
The Home Mortgage Disclosure Act requires mortgage lenders to report information about loan applications and originations to the CFPB and other federal regulators. The data can be used to "monitor whether financial institutions are serving the housing needs of their communities, and to identify possible discriminatory lending patterns," the agency said.
CFPB has the authority to take action against institutions violating consumer financial protection laws.
"Bank of America violated a federal law that thousands of mortgage lenders have routinely followed for decades," CFPB Director Rohit Chopra said in a statement. "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."
The bank said the issue had no impact on applications and that it has taken measures to address the matter.
"After receiving one complaint in 2020, we conducted a review and notified the government, which prompted this inquiry," Bank of America said in an emailed statement to IBTimes. "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."
