Billion-Dollar Bank Paying $27,760,000 Fine for Allegedly Placing Customers’ Access To Employment, Housing and Credit at Risk
The Consumer Financial Protection Bureau (CFPB) is accusing TD Bank of repeatedly placing its customers’ ability to access employment, housing and credit at risk.
According to the US financial regulator, TD Bank systematically shared “inaccurate, negative information” on its customers with consumer reporting agencies for years and consequently jeopardizing their creditworthiness, employment and housing prospects as well as other human endeavors that require consumer reports.
“The inaccurate information shared by TD Bank related to credit card and bank deposit accounts, including accounts TD Bank knew or suspected were fraudulently opened. After the bank realized it was botching its reporting to consumer reporting companies, it took far too long to correct many of its errors.”
The CFPB says TD Bank must now compensate tens of thousands of consumers to the tune of $7.76 million. TD Bank will also pay a penalty of $20 million to the Consumer Financial Protection Bureau’s victims relief fund.
Some of the inaccurate and negative information that TD Bank shared with consumer reporting firms were on credit cards.
“TD Bank reported inaccurate information about its customers’ credit card accounts to consumer reporting companies. Even though it knew it was sending incorrect information for consumer reports, the bank failed to promptly correct its mistakes. In some instances, TD Bank shared inaccurate information about credit card delinquencies. In other instances, the bank shared information that made it look like accounts were in use even though customers had voluntarily closed them.”
According to the CFPB, TD Bank also shared fraudulent information on some of its customers who were suspected or confirmed victims of fraudulent account openings.
“Derogatory information, including information that some of the fraudulent accounts were overdrawn, was shared with consumer reporting companies.”
TD Bank also failed to adequately “investigate and resolve consumer disputes,” according to the financial regulator.
“TD Bank did not have sufficient processes in place to investigate consumer reporting disputes and diverted resources from investigating disputes to other parts of its business. It then, among other things, failed to conduct reasonable and timely investigations of consumer disputes, including sometimes by not conducting any investigation at all. It also failed to properly notify consumers after deeming a dispute frivolous or irrelevant.”
The Cherry Hill, New Jersey-headquartered TD Bank currently boasts of slightly over $370 billion in total assets, according to the Federal Reserve.
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