Something happened last Wednesday that is eye-opening, on several levels.
The Consumer Financial Protection Bureau (CFPB) and the Office of Comptroller of the Currency (OCC) slammed one of the nation's biggest banks: Bank of America (NYSE: BAC).
It turns out BofA, like several other financial giants, is a billion-dollar fraud machine.
Plop, plop, fizz, fizz (that's me dropping my Alka-Seltzer), oh, what a surprise it is…
Only this latest scheme could have taken money directly from your pocket… and someone needs to be locked up.
Why Aren't These BofA Fraudsters Going to Jail?
The CFPB looked back as far as 2001 into BofA's marketing and sales of "add-on" products.
And it wasn't a surprise to the CFPB (I'll get to why it wasn't in a minute) that Bank of America had ripped off their beloved credit card customers by selling them stuff like identity theft protection and credit protection programs, without ever actually providing much of anything.
I'm not going to talk about the OCC's part in this because the OCC has only lately been flexing its puny muscles and was in LaLa Land before, during, and after the financial crisis and is a useless regulator, really just playing tag-along on the shoulders of the CFPB. Oh wait, I just did talk about them.
Anyway, CFPB Director Richard Cordray, a really great – make that a bloody amazing – crusading white-knight regulator said in a call with reporters, "We will continue to be vigilant in pursuit of anyone who deceives or mistreats consumers."
Deborah Morris, the CFPB's deputy enforcement director, estimated about 1.5 million consumers paid at least $459 million just for identity protection products.
The joint-agency enforcement action also alleges the bank used deceptive marketing tactics when selling a payment protection product meant to cancel the customer's debt if they experienced an involuntary hardship.
Check out the gory rip-'em-off details from Cordray himself – seriously, you can't make this stuff up:
About the Author
Shah Gilani boasts a financial pedigree unlike any other. He ran his first hedge fund in 1982 from his seat on the floor of the Chicago Board of Options Exchange. When options on the Standard & Poor's 100 began trading on March 11, 1983, Shah worked in "the pit" as a market maker.
The work he did laid the foundation for what would later become the VIX - to this day one of the most widely used indicators worldwide. After leaving Chicago to run the futures and options division of the British banking giant Lloyd's TSB, Shah moved up to Roosevelt & Cross Inc., an old-line New York boutique firm. There he originated and ran a packaged fixed-income trading desk, and established that company's "listed" and OTC trading desks.
Shah founded a second hedge fund in 1999, which he ran until 2003.
Shah's vast network of contacts includes the biggest players on Wall Street and in international finance. These contacts give him the real story - when others only get what the investment banks want them to see.
Today, as editor of Hyperdrive Portfolio, Shah presents his legion of subscribers with massive profit opportunities that result from paradigm shifts in the way we work, play, and live.
Shah is a frequent guest on CNBC, Forbes, and MarketWatch, and you can catch him every week on Fox Business's Varney & Co.