Bank of America Subsidiary Reversing or Refunding $36 Million in Fees

Bank of America Subsidiary Reversing or Refunding $36 Million in Fees to Resolve FTC Allegations That it Overcharged Struggling Homeowners
Excessive Default-Related Fees Allegedly Violated Earlier Countrywide Settlement

A mortgage servicing subsidiary of Bank of America Corp. agreed to settle Federal Trade Commission charges that it illegally assessed more than $36 million worth of fees against struggling homeowners, in violation of an earlier settlement with the FTC.

"It's clear to us that the Bank of America subsidiary violated the 2010 court order, and as a result, they will have to return all of the money they illegally charged homeowners who were already having trouble paying their mortgages," said FTC Chairman Jon Leibowitz.

Bank of America subsidiary BAC Home Loans Servicing, LP has already reversed or refunded $28 million worth of improper fees for title and other default-related services charged to homeowners behind on their mortgages. The new settlement requires BAC Home Loans to reverse or refund the remaining $8 million in improper fees.

BAC Home Loans, which did business as Countrywide Home Loans Servicing, LP before it was acquired by Bank of America in 2008, agreed to the FTC settlement in conjunction with a $25 billion, Global Civil Settlement that Bank of America and the four other largest U.S. banks reached with the U.S. Department of Justice and state attorneys general to resolve allegations of abusive foreclosure practices.

"Associate Attorney General Tom Perrelli deserves enormous credit for leading this massive effort to benefit millions of current and future home owners, and for herding so many state and federal cats into the same agreement," said Chairman Leibowitz. "But this settlement won't be meaningful unless going forward, banks change their behavior and respect the rights of consumers. I am cautiously optimistic that this will be the case."  Read more.