Bank of America to Pay $540 Million in FDIC Insurance Dispute

A federal judge has ruled Bank of America must pay $540 million to the FDIC for underpaying deposit insurance fees after the 2008 financial crisis. The decision ends a seven-year legal battle over how big banks calculate their risk – and what they owe to protect customer deposits.

What happened- in case of FDIC Insurance Dispute

After the 2008 crash, regulators changed how banks report risk exposure. These reports determine each bank’s share of the deposit insurance fund. The FDIC claimed Bank of America underreported its risk from 2011-2015, avoiding about $1 billion in payments.

Why it matters:

• The deposit insurance fund protects customers when banks fail
• All banks must pay their fair share to keep it strong
• Technical reporting errors can lead to big penalties