Bank of America pays $5.5 million to settle class action lawsuit over failure to properly report debt discharged in bankruptcy

Bank of America has agreed to pay $5.5 million to settle a class action lawsuit alleging it failed to update credit report information for credit card accounts sold to third parties where the account holder’s debts were discharged in Chapter 7 bankruptcy after they were sold.

According to the lawsuit BOA’s failure to update credit card information when the account holder’s debts were sold meant that the trade lines did not indicate that the debts were included in bankruptcy. The trade lines allegedly continued to reflect that the debts were sold, charged off and $0 balance.

If you had a Bank of America credit card and your debts were discharged in a Chapter 7 bankruptcy, you may be entitled to payment.

The deadline to opt out of or object to the Bank of America class action settlement is Jan. 30, 2018.  More information can be found at the settlement website.

Bank of America, Chase, Deutsche Bank and others named in class action over manipulation of LIBOR


This is an action brought asserting claims of common law fraud and violations of California’s Cartwright Act1 on behalf of all lending institutions headquartered in the states and territories of the United States that originated, purchased outright, or purchased a participation interest in, loans paying interest at rates tied to the U.S. Dollar London Interbank Offered Rate (“USD LIBOR”),2 the interest rate of which adjusted at any time between August 1, 2007 and May 31, 2010, inclusive (the “Class Period”).

As alleged, Plaintiff suffered damages as a result of Defendants’ fraudulent conduct in artificially decreasing the USD LIBOR rate during the Class Period, causing them to receive lower interest than they would have been entitled but for Defendants’ fraud.

The British Bankers’ Association (“BBA”) describes LIBOR as “the primary benchmark for short term interest rates globally.” Consistent with the BBA’s description, USD LIBOR is the “primary benchmark” for short-term interest rates in the United States (including its territories), and in particular in the State of New York, its banking capital.

Hundreds of billions of dollars of floating-rate loans are originated or sold within the United States (including its territories) each year with rates tied to USD LIBOR. Typically, a floating-rate loan (whether residential or commercial), will be issued at a base rate and will reset periodically to a rate set by adding a premium to the current rate of USD LIBOR (e.g., USD LIBOR + 3%). As a result, a misrepresentation in the referenced USD LIBOR rate on the date on which a loan resets will generally reduce the amount of interest that a lender receives by an equivalent amount.

USD LIBOR is calculated mechanically each business day and published under the auspices of the BBA. The BBA defines USD LIBOR as: The rate at which an individual Contributor Panel bank could borrow funds, were it to do so by asking for and then accepting inter-bank offers in reasonable market size, just prior to 11:00 [a.m.] London time.

Defendants, who were each Contributor Panel banks (or the holding companies for Contributor Panel banks) for the USD LIBOR panel, knew and understood that it was common practice during the Class Period for banks throughout the United States to issue floating-rate loans tied to USD LIBOR rates. Indeed, Defendants themselves transacted in loans tied to USD LIBOR rates, and referenced USD LIBOR rates in their own analyses of the U.S. financial services sector. Accordingly, it was not only foreseeable but obvious that by manipulating the rate of USD LIBOR, Defendants would impair the interest income received by Plaintiff and other lenders providing USD LIBOR-tied loans.

Despite knowing that manipulating USD LIBOR could profoundly impact vast quantities of financial transactions, Defendants repeatedly made intentionally false representations about their borrowing costs to the BBA, resulting in the artificial suppression of USD LIBOR rates during the Class Period, and causing significant damages to Plaintiff and the Class.

Class: Plaintiff brings this action as a class action pursuant to Federal Rule of Civil Procedure 23(a) and (b)(3) on behalf a Class of all banks, savings & loan institutions, and credit unions headquartered in the United States, including its fifty (50) states and United States territories, that originated loans, purchased whole loans, or purchased interests in loans with interest rates tied to USD LIBOR, which rates adjusted at any time between August 1, 2007 and May 31, 2010, both dates inclusive.


Merrill Lynch settles overtime class action lawsuit for $12 million

Merrill Lynch has agreed to create a $12 million fund to settle a class-action lawsuit alleging it didn’t properly pay overtime to employees who provide support services for brokers.

The lawsuit alleged that Merrill Lynch client associates were paid overtime based on an incorrect and low regular rate of pay and that Merrill failed to properly record and account for all overtime hours they worked. Client associates typically handle paperwork for brokers, and some can assist with order entries.

The $12 million fund will provide financial recovery for client associates who worked for Merrill Lynch between 2010 and 2012. The time period is longer for client associates who were employed in California, New York, Maryland and Washington.

Bank of America Corp. pays $2.43 billion to resolve securities class action lawsuit

In what is being called the largest settlement of a credit-crisis-related securities class action lawsuit, Bank of America Corp. has agreed to a $2.43 billion settlement on claims that it and certain of its executive officers and directors misrepresented the company’s business and financial condition, as well as the business and financial condition of Merrill, Lynch & Co. Inc. prior to BOA’s acquisition of Merrill.

The complaint alleged that the defendants violated Sections 10(b), 14(a) and 20(a) of the Securities Exchange Act of 1934, Securities and Exchange Commission Rules 10b-5 and 14a-9 and Sections 11, 12 and 15 of the Securities Act of 1933 by issuing a series of false and misleading statements concerning BoA’s due diligence in preparing its multi billion-dollar acquisition of Merrill and its ensuing payment of millions of dollars in executive year-end performance bonuses and compensation to Merrill officers and directors. The lead plaintiffs sought damages and costs associated with litigating the action.

Class: all purchasers of BOA common stock from Sept. 15, 2008, to Jan. 21, 2009, excluding any shares of BOA common stock acquired by exchanging the stock of Merrill Lynch & Co. Inc. for BOA stock through the merger between the two companies consummated on January 1, 2009,” who “held BOA common stock or 7% Cumulative Redeemable Preferred Stock, Series B as of October 10, 2008, and were entitled to vote on the merger between BOA and Merrill” or who “purchased BOA common stock issued under the Registration Statement and Prospectus for the $10 billion offering of BOA common stock that occurred on or about October 7, 2008, and were damaged thereby.