Bank of America, one of the largest financial institutions in the United States, has recently agreed to a $2.85 million class action settlement to resolve allegations that it violated New York’s Exempt Income Protection Act (EIPA). This settlement addresses claims that the bank improperly charged fees on accounts subject to attachment or garnishment, affecting account holders between January 1, 2009, and February 17, 2023. With the deadline for exclusion and objection fast approaching on Monday, May 19, 2025, now is the time for affected consumers to understand their eligibility and take action to secure their share of the settlement. This article provides a comprehensive overview of the settlement, eligibility criteria, key dates, and steps to ensure you don’t miss out on potential compensation.
Background of the Bank of America EIPA Settlement
The Exempt Income Protection Act (EIPA) in New York is designed to protect certain types of income—such as Social Security benefits, disability payments, and other exempt funds—from being seized when a creditor freezes a bank account. The class action lawsuit against Bank of America alleges that the bank violated this law by charging fees on accounts that were restrained or levied upon during the period from January 1, 2009, to February 17, 2023. These fees reportedly delayed access to exempt funds, causing financial hardship for affected account holders.
While Bank of America has not admitted to any wrongdoing, it has agreed to the $2.85 million settlement to avoid the costs and uncertainties of prolonged litigation. The settlement not only provides financial compensation to eligible class members but also includes changes to Bank of America’s practices to ensure compliance with EIPA moving forward. For instance, since August 2017, the bank has stopped aggregating judgment debtors’ accounts before calculating exempt amounts, and since February 2023, it has committed to keeping exempt funds in accounts.
This settlement is a significant step toward addressing consumer grievances and reinforcing the importance of consumer protection laws. For those who qualify, the settlement offers an opportunity to receive financial compensation without the need to file a claim, as payments will be distributed automatically to eligible account holders.
Who Qualifies for the Settlement?
To be eligible for the Bank of America EIPA settlement, you must meet the following criteria:
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Account Holder Status: You must have held a Bank of America consumer account that was restrained or levied upon due to a debt collection attempt between January 1, 2009, and February 17, 2023.
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Location: The settlement applies specifically to account holders in New York, as the lawsuit pertains to violations of New York’s EIPA.
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No Action Required for Inclusion: Eligible account holders are automatically included in the settlement unless they choose to opt out by the exclusion deadline.
Class members do not need to submit a claim form or provide additional documentation, as Bank of America has already provided the settlement administrator with the necessary client data. Eligible individuals can expect to receive approximately $35, though the exact amount may vary depending on the number of participants and administrative costs deducted from the settlement fund.
If you’re unsure whether you qualify, you can check the official settlement website or contact the settlement administrator for more information. The website provides updates and resources for affected consumers, ensuring transparency throughout the process.
Key Dates and Deadlines
The deadline for exclusion and objection is Monday, May 19, 2025. This is a critical date for class members who wish to opt out of the settlement or object to its terms. If you do not exclude yourself, you will automatically be included in the settlement and eligible to receive benefits, but you will also waive your right to pursue individual litigation against Bank of America for the same claims.
The final approval hearing for the settlement is scheduled for June 18, 2025. Once the court grants final approval, the settlement administrator will begin disbursing funds, with payments expected to be mailed or deposited approximately 45 days later, around early August 2025. Current account holders will receive their payments directly into their Bank of America accounts, while former account holders will receive a physical check by mail.
To ensure you receive your payment, make sure your contact information is up to date with Bank of America or the settlement administrator, especially if you are no longer an active account holder. Missing or outdated information could delay or prevent your payment.
How to Take Action Before the Deadline
If you believe you qualify for the settlement, here are the steps you should take:
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Confirm Your Eligibility: Review your banking records to confirm that you held a Bank of America account that was restrained or levied upon between January 1, 2009, and February 17, 2023. If you’re uncertain, contact the settlement administrator or visit the official settlement website for guidance.
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Decide Whether to Stay in or Opt Out: If you wish to receive a payment, you don’t need to take any action, as you are automatically included. However, if you prefer to pursue individual legal action or do not want to be bound by the settlement terms, you must submit a written request for exclusion by May 19, 2025. Instructions for opting out are available on the settlement website.
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Object if Necessary: If you disagree with the settlement terms but still want to participate, you can file an objection with the court by the same deadline, May 19, 2025. This allows you to voice concerns while remaining eligible for compensation.
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Update Your Contact Information: Ensure that Bank of America or the settlement administrator has your current address to avoid delays in receiving your payment.
By acting promptly, you can ensure you don’t miss out on your share of the settlement or the opportunity to make an informed decision about your participation.
Other Recent Bank of America Settlements
In addition to the EIPA settlement, Bank of America has been involved in other class action lawsuits recently, which may also affect consumers. For example:
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Aseltine v. BANA Class Settlement: This $21 million settlement addresses allegations that Bank of America charged an undisclosed $15 fee on incoming wire transfers, violating account agreements. The settlement received final court approval on December 9, 2024, with payments expected soon for current and former account holders.
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Pennsylvania Vehicle Repossession Settlement: A $3.25 million settlement was reached for Pennsylvania borrowers affected by improper vehicle repossession practices between December 23, 2016, and February 16, 2024. The deadline for exclusion or objection was in December 2024.
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ATM Surcharge Settlement: Bank of America, along with JP Morgan, Wells Fargo, Visa, and Mastercard, agreed to a $197.5 million settlement for imposing unlawful ATM surcharges between October 1, 2007, and July 26, 2024. The deadline for filing a claim is January 22, 2025, with a final approval hearing scheduled for January 23, 2025.
These settlements highlight ongoing scrutiny of banking practices and underscore the importance of consumer protection laws in holding large institutions accountable.
Why This Matters for Consumers
Class action settlements like the Bank of America EIPA case provide critical recourse for consumers who may have been harmed by unfair banking practices. By coming together in a collective lawsuit, plaintiffs can present a stronger case against a multi-billion-dollar institution, increasing the likelihood of a favorable outcome. The $2.85 million settlement, while significant, is just one example of how consumers can seek justice when their rights are violated.
Moreover, this settlement serves as a reminder to stay informed about your banking rights. Laws like the EIPA are designed to protect vulnerable consumers, particularly those relying on exempt income for their livelihood. By understanding your eligibility and the steps required to participate, you can take advantage of opportunities to recover funds and advocate for fair treatment.
Broader Context: Bank of America’s Legal and Financial Landscape
Bank of America has faced multiple legal challenges in recent years, reflecting broader issues in the banking industry. For instance, a 2014 settlement saw the bank pay $16.65 billion, with New York receiving $800 million, to resolve claims related to the sale of mortgage-backed securities before the 2008 financial crisis. More recently, a class action lawsuit filed in 2025 alleges that Bank of America unlawfully pocketed interest earned on California Employment Development Department (EDD) debit card accounts, further highlighting ongoing concerns about the bank’s practices.
Despite these challenges, Bank of America remains a major player in the financial sector, with operations in 35 countries and a strong focus on digital banking. The bank’s recent announcement to explore stablecoins and its early redemption of $3 billion in senior notes due in 2026 indicate a forward-looking strategy, even as it addresses past legal issues.
Looking Ahead
The Bank of America $2.85 million EIPA settlement offers eligible New York account holders an opportunity to receive compensation for improper fees charged on restrained or levied accounts between 2009 and 2023. With the exclusion and objection deadline set for Monday, May 19, 2025, and payments expected to begin around August 2025, now is the time to confirm your eligibility and update your contact information. By staying informed and acting promptly, you can ensure you receive your share of the settlement and contribute to holding large institutions accountable. For more details, visit the official settlement website or contact the settlement administrator today.