NYC Comptroller Brad Lander is calling for Bank of America to initiate a clawback of executive compensation after it was ordered by federal regulators to pay more than $250 million in fines and customer refunds to settle a slew of charges, including double-dipping on overdraft fees, withholding credit card reward bonuses and opening fake accounts.
“We were disturbed to learn that Bank of America has been ordered to pay more than $100 million in customer refunds and $150 million in penalties to federal regulators,” Lander wrote in a letter to the bank’s board of directors. “I believe that the Compensation and Human Capital Committee holds both the responsibility and the authority to promptly initiate the clawback of eligible incentive compensation from the executives responsible (including those in a supervisory role) for the legal violations.”
Earlier this month, the Consumer Financial Protection Bureau ordered Bank of America to pay its customers more than $100 million “for systematically double-dipping on fees imposed on customers with insufficient funds in their account, withholding reward bonuses explicitly promised to credit card customers and misappropriating sensitive personal information to open accounts without customer knowledge or authorization.”
The CFPB also ordered Bank of America to pay $90 million in penalties. At the same time, the Office of the Comptroller of the Currency levied a $60 million civil money penalty against the bank “for violations of law relating to its practice of assessing multiple overdraft and insufficient funds fees against customers for a single transaction.”
Lander’s letter urges the bank to disclose the details of any compensation clawed back from any senior executive; the general circumstances of any compensation clawed back from lower-level employees; and reports from all internal board or company investigations used by the bank to reach its clawback determinations.
“Instituting a clawback of incentive compensation is a critical accountability measure, and the onus is on the Board of Bank of America to re-establish clear expectations of ethical conduct and responsible business practices,” Lander said in a release.
Representatives for Bank of America had no immediate comment.
Separately, Lander issued a statement criticizing asset management giant BlackRock for appointing Saudi Arabian Oil Co. CEO Amin Nasser to its board.
“The appointment of the CEO of the world’s largest oil producer to BlackRock’s board undermines its own stated climate commitments,” the statement said. “At a time when financial institutions need to take a collective approach to addressing the financial risks from climate change, BlackRock shareholders expect climate-competent, not climate-conflicted, directors.”
Representatives for BlackRock did not immediately respond to a request for comment.