Bank of America ordered to pay $540 million in FDIC insurance dispute

A federal decide has ordered Bank of America to pay $540.3 million to the Federal Deposit Insurance Corporation (FDIC) in a long-standing authorized battle over underpaid deposit insurance assessments. The ruling, made public on Monday, stems from assessments owed between the second quarter of 2013 and the top of 2014, and contains accrued curiosity.
According to Reuters, the lawsuit dates again to 2017, when the FDIC sued the Charlotte, North Carolina-based lender for $1.12 billion. The criticism alleged that Bank of America failed to adjust to a 2011 federal rule that altered how banks report their publicity to counterparty dangers—a regulation launched as half of broader reforms to safeguard the US banking system following the 2008 monetary disaster.
In her 59-page ruling, US District Judge Loren AliKhan in Washington, DC, dismissed Bank of America’s argument that the FDIC’s actions have been arbitrary and lacked an inexpensive foundation. She emphasised that the FDIC was not required to develop a flawless metric for measuring potential losses and famous that Bank of America couldn’t declare it lacked adequate discover concerning its obligations.
However, Judge AliKhan additionally decided that the FDIC had waited too lengthy to pursue claims associated to durations earlier than the second quarter of 2013.
Bank of America has strongly denied any intention of evading funds. In an announcement to Reuters, spokesperson Bill Halldin stated, “We are pleased the judge has ruled and have reserves reflecting the decision.”
The FDIC declined to touch upon the ruling. Judge AliKhan issued the choice on March 31, releasing {a partially} redacted model to the general public.
Bank of America, the second-largest US financial institution, is scheduled to report its first-quarter earnings on Tuesday. The case is FDIC v. Bank of America NA, US District Court, District of Columbia, No. 17-00036.