Bank of America

Bank of America is a financial services company, one of the largest bank holding companies in the United States of America. Provides a wide range of banking services to private and legal entities. The company has 47 million customers, 4,600 retail branches and 16 thousand ATMs (data as of October 2017).

Performance indicators

2023

Good dynamics compared to competitors

The third largest bank in the world

The largest banks in the world by capitalization for June 2023

History

2023

Theft of data of tens of thousands of customers due to ransomware virus attack

On August 9, 2023, the audit and consulting company Ernst & Young (EY) announced that as a result of the ransomware virus attack, personal information of tens of thousands of Bank of America customers was stolen.

Attackers exploited vulnerabilities in the MOVEit Transfer software developed by IpSwitch (a subsidiary of Progress Software). This application is intended for confidential transfer of various files. For example, the software makes it possible to organize the exchange of information between employees of a particular enterprise and external contractors. At the end of May 2023, it became known about suspicious activity in the networks of many organizations using MOVEit Transfer. The investigation showed that cybercriminals exploited a previously unknown vulnerability to execute SQL queries on the database and steal files.

As a result of a hacker attack, the personal information of tens of thousands of Bank of America customers was stolen

The intrusion affected 30,210 Bank of America customers, according to an EY letter to Maine's attorney general. At the disposal of the attackers was an extensive set of personal data: these are names and surnames, addresses, information about financial accounts, debit or credit card numbers, social security numbers, as well as identification numbers issued by the government. Cybercriminals can use stolen information for a variety of fraudulent schemes, from phishing attacks to opening new accounts, making unauthorized purchases or obtaining loans under false pretenses.

The cybercriminal group Cl0p claimed responsibility for the hack. Experts warn that even a seemingly minor leak of personal information could have fatal consequences. Victims whose data is stolen often fail to understand that they have been compromised and therefore take no action to mitigate the impact.^[1]

Fine of $250 million for double fees, deception with loan benefits and hidden opening of accounts to customers

On July 11, 2023, Bank of America agreed to pay $250 million in fines and compensation to settle claims that the bank systematically charged customers double fees, did not provide promised credit card benefits and opened accounts without customer permission.

For several years, Bank of America recovered tens of millions of dollars by charging numerous fees to customers who lacked sufficient funds in their accounts, according to the Consumer Financial Protection Bureau (CFPB) and the Office of the Comptroller of the Currency (OCC).

Since at least 2012, Bank of America employees have also illegally applied for credit cards and issued them for consumers without their knowledge, the CFPB said in a statement.

According to the CFPB, the bank also failed to deliver on promises of cash rewards and bonus points to tens of thousands of credit card customers.

2022: Penalty for using WhatsApp for work purposes

On August 22, 2022, it became known that large US banks such as JPMorgan Chase and Bank of America will collectively pay more than $1 billion in fines for employees using unauthorized messaging tools, including email and applications such as WhatsApp. Read more here.

2021

Raising the minimum wage for employees in the United States to $25 per hour

At the end of May 2021, Bank of America announced that by 2025 it would raise the minimum wage for its employees in the United States to $25 per hour. The bank's management believes that higher pay contributes to the formation of "career thinking" among employees and ultimately increases their loyalty to the company.

This will cost us several hundred million dollars a year<...>, but this is an important investment, "said bank CEO Brian Moynihan, adding that it is about maintaining" a high standard of living for our teammates.

The bank's management hopes that the initiative of such a large company will be able to set standards for the entire industry.

Bank of America raises minimum wage to $25 an hour

This is not the first time Bank of America has raised the minimum wage for its employees. In 2017, the bank raised its minimum wage to $15 an hour. Two years later, the company announced that it would raise this level to $20 in the next two years and implemented this plan ahead of schedule. The latest pay rise has affected more than 200,000 employees.

The decision made by the bank is another stage in the national debate on the minimum wage, which intensified again during pandemics and after the inauguration of President Joe Biden, who supports raising the federal minimum wage to $15 per hour. The President reiterated these plans in his address to the meeting Congress on April 28, 2021, and earlier signed a decree raising the minimum wage for federal contract workers to $15 per hour in early 2022 (in 2021 this value is $10.95).

Bank of America will also require its sellers and suppliers to pay their employees at least $15 an hour. This decision will affect more than 2,000 supplier firms and 43,000 employees of these firms. According to Moynihan, 99% of suppliers already pay their workers at least $15 an hour.^[2]

Bank gives FBI information on 211 customers who may have been involved in the assault on the Capitol

The second largest US bank, Bank of America, at the request of the FBI, analyzed the purchases of its customers in order to calculate "extremists" among them, Fox News reported in February 2021.

Those who stayed in or around Washington after storming the Capitol were considered suspicious:

• «1. Customers identified as having made card purchases in Washington on January 5 or 6.
• 2. Hotel shopping/home reservations on Airbnb in Washington, Virginia or Maryland after Jan. 6.
• 3. Any gun purchases or gun-related outlets between Jan. 7 and a suspected stop in or around Washington. 
• 4. Airline-related purchases after Jan. 6 "

According to the TV channel, the bank transferred information about 211 of its clients to the feds, endangering their well-being.

2019: In the top 20 most profitable companies in the world

The 20 most profitable companies in the world. Earnings per day, 2019

2019

2018: Reduced 100,000 jobs through automation

On October 16, 2018, Bank of America CEO Brian Moynihan said in an interview with CNBC that in less than 10 years the company's headcount has decreased by 100 thousand people or about 30%, which was largely facilitated by the introduction of technologies and automation.

We employed 288 thousand people when I took over as CEO on January 1, 2010. In the last [third - approx. TAdviser] quarter, we had 204 thousand employees, - said Moynihan, who heads the second largest credit institution in the United States by October 2018, at the CNBC Net/Net Summit forum, which took place on the New York Stock Exchange.

The head of Bank of America noted that at some point the bank's staff reached 305 thousand employees. As a result, he said, more jobs were cut than there are in the entire Delta Air Lines airline. This air carrier is among the leaders in the world in terms of the number of aircraft, in terms of passenger traffic and in terms of the number of destinations.

Bank of America has cut staff by 30% since 2010, to 204,000 employees in the third quarter of 2018

Brian Moynihan stressed that a significant decrease in the number of personnel at a giant bank like Bank of America was made possible by applying technology to workflows, as well as by changing customer behavior.

Moynihan says that Internet banking has existed since the 1990s, but the situation here has changed radically only with the appearance of the first iPhone in 2007, since then customers got the opportunity, in fact, to have a bank in their pocket. In 2008, Bank of America began planning its digital strategy, and by October 2018, almost 26 million customers use the bank's mobile application, and the audience growth rate is only increasing. Automation and mobile technology have enabled the company to close underperforming branches and shift staff to customer-facing positions.

Artificial intelligence and process automation helped reduce the number of man-hours by 84 thousand per year at Bank of America branches on Wall Street. The bank combined the work of data centers in one network and transferred applications to the private cloud, which made it possible to reduce costs.^[3]

2017: Information security expenses of $600 million

In October 2017, it became known about Bank of America's spending on information security (information security). The company is willing to spend more than half a billion dollars to provide cyber protection to its IT infrastructure in 2017 and 2018.

In an interview with CNBC, Bank of America Operations and Technology Director Cathy Bessant said that the bank's information security budget for 2017 is $600 million. The same amount of investment is scheduled for 2018. In 2015, costs were measured at $400 million.

Bank of America allocated $600 million for information security in 2017

According to Bessant, about 1,200 Bank of America employees are involved in ensuring the information security of the bank's infrastructure.^[4]

Bank of America began to increase information security costs after a massive leak of customer data, which became known in 2011. Then one of the bank's employees, who had access to confidential information of clients, copied this data and transferred it to cybercriminals.

The compromised data included full names of customers, their addresses, Social Security numbers, phone numbers, bank account numbers, driver's licenses, email addresses, dates of birth and even PINs and account status information. The damage from this leak amounted to $10 million.

In a 2017 interview with Bloomberg, Bank of America CEO Brian Moynihan said cybersecurity is the only area in which the company has no budget restrictions.

According to Infosecurity Magazine, financial institutions are 300 times more likely to encounter information security incidents compared to other companies.

According to Juniper Research analysts, the widespread development of technologies will lead to an increase in data leaks: the damage from them will reach $2.1 trillion by 2019, which is four times more than in 2015.^[5]

Notes