US consumer watchdog has imposed a $37.5m fine on US Bank for accessing consumer data to open sham accounts without their permission.
The Consumer Financial Protection Bureau (CFPB) said that the lender pressurised and incentivised its employees to sell multiple products and services to its customers.
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As part of the employees’ job requirement, the bank also imposed sales goals, the regulator said.
The move led employees of US Bank to illegally access customers’ credit reports and personal data to open accounts for unsuspecting customers.
CFPB director Rohit Chopra said: “For over a decade, US Bank knew its employees were taking advantage of its customers by misappropriating consumer data to create fictitious accounts.
“We all must do more to hold lawbreaking companies accountable when they abuse and misuse our sensitive personal data.”
In its investigation, the regulator found that US Bank was aware of the misappropriation, but its measures were inadequate to prevent and detect unauthorised accounts.
Specifically, the bank exploited customers’ personal data without authorisation, opened accounts without permission and failed to provide legally required consumer disclosures.
The regulator said that the bank must pay a $37.5m penalty and return all unlawfully charged fees and costs, plus interest.
US Bancorp is the holding company of US Bank.
Earlier this month, the CFPB and the Office of the Comptroller of the Currency (OCC) imposed a $225m fine on Bank of America for ‘botched’ disbursement of government unemployment benefits at peak of the Covid-19 pandemic.
