June 4, 2020 / 1:49 PM / a month ago

Bank of America to pay $7.23 million for mutual fund overcharges: FINRA

FILE PHOTO: A Bank of America logo is pictured in the Manhattan borough of New York City, New York, U.S., January 30, 2019. REUTERS/Carlo Allegri/File Photo

(Reuters) - Bank of America Corp (BAC.N) agreed to pay $7.23 million in restitution and interest to settle a U.S. regulator’s accusations that it overcharged customers on mutual funds.

The Financial Industry Regulatory Authority (FINRA) said on Thursday that the accord resolves charges that defective procedures at the bank’s Merrill Lynch unit caused customers holding 13,328 accounts to incur unnecessary sales charges and fees from April 2011 to April 2017.

FINRA said some eligible customers failed to receive waivers of front-end sales charges when they bought fund shares after previously selling shares from the same fund family, while others failed to receive rebates of back-end sales fees.

Merrill Lynch did not admit or deny wrongdoing. FINRA said the accord reflected the unit’s “extraordinary” cooperation, including its hiring an outside consultant to find harmed customers and promptly paying restitution.

In 2014, FINRA ordered Merrill Lynch to pay an $8 million fine and $24.4 million in restitution to settle charges it failed to waive mutual fund sales charges and fees on more than 47,000 accounts for retirement plans and charitable entities.

FINRA is a self-regulatory organization for the financial industry.

Reporting by Jonathan Stempel in New York; Editing by Chizu Nomiyama

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