The second-largest U.S. bank by total assets says it is preparing for significant losses due to ongoing regulatory issues.
In a new filing with the U.S. Securities and Exchange Commission (SEC), Bank of America says it faces a “reasonably possible and estimable” loss of up to $800 billion as a result of investigations by the Consumer Financial Protection Bureau (CFPB) and others federal regulators. .
“The company has responded to a Consumer Financial Protection Bureau (CFPB) investigation regarding the company’s processing of electronic money payments through the Zelle network.
CFPB staff has initiated discussions with the Corporation to resolve the investigation or pursue enforcement action. The company is evaluating next steps, including litigation.”
Bank of America also says it is in discussions with several unnamed federal regulators about its anti-money laundering and sanctions compliance programs, and that a resolution of the discussions could result in “one or more public orders from the regulators.”
Investigators are reportedly investigating BofA, along with JPMorgan Chase and Wells Fargo, to determine whether the banks are properly reimbursing fraud victims on the Zelle payment network and whether the banks are effectively eliminating scammers’ accounts.
Zelle has also caught the attention of US lawmakers.
The Senate Permanent Subcommittee on Investigations said in July that Bank of America, Wells Fargo and JPMorgan Chase had jointly refused to refund $880 million in disputed transactions on Zelle between 2021 and 2023.
The subcommittee found that in 2023, the three trillion-dollar banks reimbursed victims for reported Zelle scams only 38% of the time. In 2019, the three reported Zelle scam victims reimbursed 62% of the time.
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