Banking giant Bank of America must pay $540.3 million after a federal judge ruled in favor of the Federal Deposit Insurance Corporation (FDIC) over long-standing claims of underpaid deposit insurance assessments. The FDIC sued Bank of America, alleging that the company failed to honor a 2011 regulatory rule and unjustly enriched itself at the agency’s expense. The regulator initially claimed over $500 million, later expanding its demand to $1.12 billion. Bank of America strongly denied acting with any intent to evade payments and moved to dismiss parts of the case, arguing that some claims were outside the statute of limitations. After years of legal battles, U.S. District Judge Loren L. AliKhan partially sided with both parties. She ordered Bank of America to cover underpaid assessments from the second quarter of 2013 through the end of 2014, including interest. However, she agreed that the FDIC waited too long to pursue earlier claims.
“We are pleased the judge has ruled and has reserves reflecting the decision,” Bank of America said in a statement to The Associated Press. Furthermore, the FDIC declined to comment. Additionally, despite the hefty payment, Bank of America reported strong earnings. The company posted a first-quarter profit of $7.4 billion and revenue of $27.37 billion net of interest expense, surpassing Wall Street expectations. Based in Charlotte, North Carolina, Bank of America remains the second-largest bank by assets in the U.S. Meanwhile, the FDIC continues to operate as one of the country’s key banking regulators, best known for insuring Americans’ deposits up to $250,000 per account in case of a bank failure.
