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BofA Expected to Pay $200M for Personal Device Misuse

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Bank of America Corp. is expected to pay a $200 million fine related to a sweeping U.S. probe into the use of unapproved personal devices, according to people familiar with the matter.

The company will pay an amount in line with penalties that have been levied across Wall Street banks, said the people, who asked not to be identified because they weren’t authorized to speak publicly.

A representative for Bank of America declined to comment.

The bank disclosed $425 million of expenses in its second-quarter results Monday related to “certain regulatory matters.”

Last week, the bank said it was fined $225 million by regulators for unfair and deceptive practices related to a prepaid card program to distribute unemployment insurance and other public-benefit payments amid the pandemic.

Finance firms are required to scrupulously monitor communications involving their business.

That system, already challenged by the proliferation of mobile-messaging apps, was strained further as firms sent workers home shortly after the start of the Covid-19 outbreak.

Investigators have been looking into banks including JPMorgan Chase & Co, Citigroup Inc. and

The expected fine follows a disclosure by Morgan Stanley last week that it faces a similar penalty stemming from the investigation. The $200 million expense was “related to a specific regulatory matter concerning the use of unapproved personal devices and the firm’s record-keeping requirements,” it said.

Citigroup took a one-time reserve for the communications probe, Chief Financial Officer Mark Mason said during its earnings on Friday. The amount was in line with what “peers have disclosed,” he said.

Late last year, the Securities and Exchange Commission and the Commodity Futures Trading Commission imposed $200 million in fines on JPMorgan.

Added up, regulators are poised to extract about $1 billion from the five biggest US investment banks for failing to monitor employees using unauthorized messaging apps, Bloomberg reported earlier.

(Image: AP)

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