$42M BofA Military Member Fee Settlement Preliminarily Approved

On Wednesday, a North Carolina federal judge preliminarily approved a $41.9 million class action settlement involving allegations Bank of America Corporation violated the Servicemembers Civil Relief Act by improperly charging military members high interest rates.

This BofA class action settlement would resolve a lawsuit filed in 2015 by military families who claim Bank of America overcharged them on interest and fees related to credit card accounts and mortgage accounts. The plaintiffs allege BofA also tried to conceal the overcharges.

Shortly before the Bank of America class action lawsuit was filed, the bank agreed to a deal with the U.S. Department of the Treasury that required BofA to remediate qualified service members for its violations of the Servicemembers Civil Relief Act.

Bank of America sought to have the military member fee class action lawsuit dismissed, arguing that the claims were barred by the statute of limitations. The bank also argued that service members had already received refunds and were therefore not entitled to recover damages. However, the BofA class action lawsuit survived the motion to dismiss.

“Plaintiffs disagree and view Bank of America’s payments to servicemembers as voluntary payments for poor service, and argue that the payments cannot be used to ‘offset’ damages sustained in this lawsuit,” the plaintiffs argued in their motion for preliminary approval of the proposed settlement. “But this is a unique fact pattern and if the court were to rule for Bank of America on the question, it would likely result in far less recovery for the class than provided for in the proposed settlement, if any.”

Under the terms of the Bank of America settlement, Class Members include: “All persons identified in Bank of America’s records as obligors or guarantors on an obligation or account who, at any time on or after September 11, 2001, received and/or may have been eligible to receive additional compensation related to military reduced interest rate benefits from Defendant,” excluding those who have executed a release of the rights claimed in the BofA class action lawsuit.

The motion for preliminary approval of the Bank of America class action settlement indicates Class Members will fall into four different groups, depending on the type of BofA accounts they held. Class Members who did not previously receive or deposit payments from Bank of America will be entitled to receive a share of the first $15.4 million of the BofA settlement fund.

According to the BofA class action settlement documents, notice to Class Members will be mailed and/or emailed by Oct. 13, 2017, and a website will be established with more information about the settlement.

The final fairness hearing has been scheduled for Feb. 5, 2018.

Top Class Actions will post updates to this class action settlement as they become available. For the latest updates, keep checking TopClassActions.com or sign up for our free newsletter. You can also receive notifications when this article is updated by using your free Top Class Actions account and clicking the “Follow Article” button at the top of the post.

The plaintiffs are represented by Steve W. Berman and Shayne C. Stevenson of Hagens Berman Sobol Shapiro LLP and Knoll D. Lowney of Smith & Lowney PLLC.

The BofA Military Member Fee Class Action Settlement is Childress, et al. v. Bank of America Corporation, et al., Case No. 5:15-cv-00231, in the U.S. District Court for the Eastern District of North Carolina.

UPDATE: November 2017, the Bank of American military member fee class action settlement is now open. Click here to learn more.