FILE PHOTO: A Bank of America logo is pictured in the Manhattan borough of New York City
By Jonathan Stempel
(Reuters) -Bank of America agreed to pay a $12 million fine to settle U.S. regulatory charges it routinely submitted inaccurate information about mortgage applicants to the federal government, violating a law that thousands of mortgage lenders have followed for decades.
The U.S. Consumer Financial Protection Bureau said on Tuesday that more than 400 loan officers at the second-largest U.S. bank failed to ask applicants required questions about their race, ethnicity and sex, and then falsely reported that the applicants chose not to respond.
Failing to accurately report demographic data violates the Home Mortgage Disclosure Act, a 1975 law that helps regulators assess whether lenders are serving their communities’ housing needs and not engaged in discriminatory lending, the CFPB said.
Bank of America did not admit or deny wrongdoing in accepting the civil fine, which covered alleged conduct between 2016 and 2021.
“We will be taking additional steps to ensure that Bank of America stops breaking the law,” CFPB Director Rohit Chopra said in a statement, without elaborating.
In a statement, the Charlotte, North Carolina-based bank said it properly collected demographic data more than 99% of the time, and notified the government after receiving a complaint in 2020. It also said it has improved training to ensure that employees ask mortgage applicants for the data.
The CFPB had no immediate additional comment.
According to its latest quarterly report, Bank of America’s consumer lending business originated $15.5 billion of first mortgages between January and September, down 61% from a year earlier when interest rates were lower.
(Reporting by Jonathan Stempel in New York; Editing by Aurora Ellis)
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