BANK OF AMERICA
Federal taxpayer bailout funds received: $45.0 billion
Profits for last 10 years : $135.0 billion
Bank account fees for last 10 years: $66.9 billion
Median Bank of America teller wage: $10.50/hour, or $21,850 annually
2007-08 CEO Ken Lewis pay: $34.8 million
2008 bonuses : $5.2 billion
Cash bonuses (top 5 execs) last 10 years : $459.9 million
Change in bank account fee revenue (2003-08): +83.6%
Offshore subsidiaries in tax havens : 143
Unreasonable bank fees
• In 2008, BofA collected $10.3 billion in bank fees, 16 percent more than in 2007. In fact, BofA customers paid $11.68 in fees for every $1,000 in their bank account, almost 30% higher than either of its two largest competitors.
• In 2008, 66 percent of BofA’s noninterest income, such as income from fees and credit cards, came from individual consumers and small businesses rather than corporate deals and investments.
• BofA recently agreed to pay $35 million to settle a class-action lawsuit that claimed the bank manipulated customers’ bank accounts to increase overdraft fees.
Credit card abuses
• After taking bailout money BofA continues running up credit card interest rates on customers even if they have made every payment on time. In 2007, the bank arbitrarily hiked interest rates on one million play-by-the-rules, pay-on-time customers.
• Former employees of MBNA, which is now BofA’s credit card arm, say that they were trained to (1) offer customers higher interest rates even if they qualified for lower ones, (2) deliberately fail to inform spouses of active military servicemen and women that they were legally entitled to a lower interest rate, (3) aggressively sell overpriced credit protection plans with false or misleading information, and (4) convince customers to take on debt levels they could not afford.
Exploiting vulnerable customers
• Between 1993 and 2003, Bank of America collected an estimated $284 million of Social Security funds from the accounts of elderly and disabled customers in order to get bank fees. In 2004, a California jury awarded damages to the affected customers that could exceed $1 billion.
• A class-action lawsuit filed in March alleges that Bank of America knowingly “assisted, facilitated and furthered” a $380 million Ponzi scheme affecting 1,500 investors, many of whom were blue-collar workers and civil servants.
• Just months before Merrill Lynch had to be sold to BofA last year to avoid collapse, Merrill’s CEO John Thain spent $1.2 million redecorating his office. His spending spree included an $87,000 area rug and a $1,400 trash can.
• With eight corporate jets, BofA had one of the largest corporate aircraft fleets on Wall Street, worth an estimated $360-400 million. It costs about $10,000 an hour to fly one of the jets, so the two-hour flight from the bank’s headquarters in Charlotte to New York City can cost around $20,000 each way. In February, BofA announced that it would sell three of the jets.
• BofA is spending $140 million for naming rights to Bank of America Stadium in Charlotte, home of the Carolina Panthers, and spent an estimated $10 million hosting a five-day “Super Bowl Fun Fest” this February, even after taking taxpayer bailout funds.
• Although Bank of America’s consumer lending declined in 2008, the bank’s insider lending to directors and bank executives more than doubled last year to $624 million, the biggest dollar jump in the country.
• BofA and Merrill Lynch awarded its traders and executives $5.2 billion in bonuses for 2008, despite receiving a $45 billion taxpayer bailout. 11 Merrill Lynch executives and traders were paid more than $10 million each, while nearly 700 were received at least $1 million. With this money, BofA could have given each of its bank tellers an estimated $151,000 raise, nearly seven times their median salary.
• Since 2004, the Bank of America has cut more than 34,000 jobs. Now, despite receiving a $45 billion...