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Bank of America has agreed to a settlement that will require the second-largest US bank to shell out about $2.85 million to current and former customers.
The class action lawsuit alleged BofA violated New York’s Exempt Income Protection Act (EIPA) by mishandling and charging improper fees to customers who had been slapped with court-order restraints.
Specifically, the lawsuit says that BofA grouped multiple accounts together before calculating how much of the customers’ funds were legally protected, leading to more funds being frozen than allowed by law.
The lawsuit also alleged BofA issued checks to debtors for the exempt amount by regular mail, meaning that the class members faced delays in accessing the money needed for daily expenses.
BofA has agreed to the terms of the settlement without admitting to any wrongdoing. On top of the multi-million-dollar payout, BofA says it is permanently changing its practices, including:
- Stopping aggregating accounts when computing how much money is protected by law.
- Notifying account holders of their rights if their accounts had been restrained.
- Halting the practice of issuing checks for exempt funds so customers can access their money as needed via debit cards, online bank transfers and others.
The settlement is subject to court approval.
