2016 Analysis of Regulatory Violations & Consumer Complaints

With the news of mass customer exploitation by Wells Fargo, we evaluated consumer complaints and regulatory violations to see how the rest of the retail banks in the U.S. stack up.

Due to the nature of what they do, banks and financial institutions in the United States are held to high scrutiny. We analyzed data on tens of thousands of consumer complaints as well as settlements and financial penalties for America’s 50 largest retail banks by asset size. This allowed us to create a set of metrics for judging their relative trustworthiness and relationship with customers.

Click here to see the most complained about banks in each state.

The Banks with the Most Fines & Consumer Complaints

  • Bank of America

    • Consumer Complaints: 44/50
    • Regulatory Penalties: 48/50
    • Responsiveness: 34/50
  • Barclays

    • Consumer Complaints: 49/50
    • Regulatory Penalties: 50/50
    • Responsiveness: 2/50
  • HSBC

    • Consumer Complaints: 38/50
    • Regulatory Penalties: 47/50
    • Responsiveness: 47/50
  • EverBank

    • Consumer Complaints: 45/50
    • Regulatory Penalties: 37/50
    • Responsiveness: 38/50
  • Wells Fargo

    • Consumer Complaints: 42/50
    • Regulatory Penalties: 41/50
    • Responsiveness: 41/50
  • Santander

    • Consumer Complaints: 46/50
    • Regulatory Penalties: 29/50
    • Responsiveness: 43/50
  • Synchrony

    • Consumer Complaints: 50/50
    • Regulatory Penalties: 39/50
    • Responsiveness: 1/50
  • Discover

    • Consumer Complaints: 48/50
    • Regulatory Penalties: 38/50
    • Responsiveness: 9/50
  • SunTrust

    • Consumer Complaints: 43/50
    • Regulatory Penalties: 43/50
    • Responsiveness: 12/50
  • Capital One

    • Consumer Complaints: 42/50
    • Regulatory Penalties: 33/50
    • Responsiveness: 15/50

The Full List of Banks

The table below shows all 50 financial institutions examined in this study, and their relative rank in the categories we looked at. Note that we grouped certain banks together, if they are owned by a single holding company. For example, Santander Holdings USA, Inc. owns both Santander Bank USA and Banco Santander Puerto Rico.

Overall RankFinancial InstitutionResponsiveness RankComplaints RankRegulatory Penalties Rank
1Frost Bank2321
2East West Bank3131
3Umpqua Holdings Corporation1381
4Union Bank2161
5New York Community Bank19141
6BOK Financial Corp3191
7First Citizens37101
8Webster Bank6201
8BMO Harris39111
10Whitney Bank4991
11Commerce Bank25161
12People's United Bank46121
13Bank of the West30171
14BBVA Compass9231
15BankUnited43151
16Associated Bank71323
17Zions Bancorporation, Zions First National Bank26727
18Comerica17251
19E*Trade Bank48525
20Raymond James Bank, N. A.35142
21Rabobank11449
22BB&T Financial39241
23Synovus Bank312122
24Scottrade Bank351826
25KeyBank NA232721
26The Huntington National Bank162824
27Banco Popular North America, Banco Popular de Puerto Rico45341
28USAA Savings213120
29TD Bank US Holding Company73228
30Ally Financial Inc.33040
31CIT Bank National Association50401
32Regions Financial Corporation203331
33Citizens Financial Group, Inc.53930
34Citibank172944
35Fifth Third Financial Corporation133634
36First Tennessee Bank412246
37JPMorgan Chase & Co.292645
38PNC Bank N.A.283532
39M&T Bank Corporation333735
40U.S. Bancorp274136
41Capital One154733
42SunTrust Banks, Inc.124343
43Discover94838
44Synchrony Financial15039
45Santander Bank US, Santander Consumer USA Holdings Inc, Banco Santander Puerto Rico434629
46Wells Fargo & Company414241
47EverBank384537
48HSBC North America Holdings Inc.473847
49Barclays PLC24950
50Bank of America344448

The Best (and Worst) in Each of the Categories

We take a closer look at the three main categories to see which banks ranked the highest and lowest in each. Generally, small community and regional banks preformed better than national chains with one exception -- responsiveness.

Consumer Complaints

The first group of metrics we looked at was customer complaints. The Consumer Financial Protection Bureau (CFPB) maintains a database of all the complaints they’ve received since 2013. These reflect problems users had with any financial product offered by these banks – anything from checking accounts to credit cards. These grievances are typically the result of a customer not receiving a satisfactory response from a bank. That is, they tried to talk to a customer service representative or banker, and were either ignored or unhappy with the result. The CFPB, a government regulatory agency, is typically the next stop for consumers in such a case.

Least Complaints

RankBankComplaints Per $100M in AssetsTotal Complaints
1Raymond James Bank0.0124
2Frost Bank0.1442
3East West Bank0.2271
4Rabobank0.2666
5E*Trade0.32157

Most Complaints

RankBankComplaints Per $100M in AssetsTotal Complaints
1Synchrony Bank12.910,665
2Barclays10.83,216
3Discover6.15,365
4Capital One5.117,177
5Santander3.64,524

Regulatory Violations & Penalties

The next factor was regulatory penalties. We sourced data from Good Jobs First's Violation Tracker, which shows fines, settlements and other penalties paid by banks for issues like mortgage abuses, credit card violations and toxic securities. These serve as a good indicator of whether a bank engaged in practices the government deemed as illegal. For example, recently Wells Fargo received media attention after their bankers opened thousands of credit card and deposit accounts for customers without their authorization. As a result, the bank paid $185M in fines and was forced to refund money to affected customers.

Least Penalties

RankBankTotal AssetsNumber of Violations
1BB&T Financial$222MNone
2BMO Harris$132MNone
3BBVA Compass$92MNone
4Comerica$71MNone
5CIT Bank$67MNone

Most Penalties Per Asset

RankBankTotal PenaltiesPenalties Per Asset
50Barclays$3,371M114
49Rabobank$800M32
48Bank of America$56,690M26
47HSBC$4,034M14
46First Tennessee Bank$332M12

Responsiveness

The last metric was responsiveness. Problems and issues happen all the time, and it’s important to most consumers for their bank to respond in a timely manner. Once again, we turned to the CFPB database to analyze three key components of responsiveness – timeliness, response type, and consumer satisfaction. Larger banks had the edge in this category. They were more likely than smaller institutions to provide consumers with relief, such as a refund.

Most Responsive

RankBank% Disputed ResolutionsResponsiveness Score
1Synchrony15%14
2Barclays18%22
3Ally Financial17%36
4BOK Financial16%36
5Citizens Bank19%40

Least Responsive

RankBank% Disputed ResolutionsResponsiveness Score
50CIT Bank24%133
49Whitney Bank27%132
48E*Trade25%122
47HSBC23%120
46People's United Bank23%111

Most Complained About Banks by State

The complaint data from the CFPB allowed us to look at which institutions received the most issues per state. Keep in mind that, a lot of the time, this data may be skewed because of the massive presence of one of these companies in a given state. The complaints date back to December 2011, up through 2016.

StateCompany with Most ComplaintsTotal ComplaintsPercent of All Complaints
State AlaskaCompany with Most Complaints Wells Fargo & CompanyTotal Complaints 107Percent of All Complaints 32%
State AlabamaCompany with Most Complaints Wells Fargo & CompanyTotal Complaints 440Percent of All Complaints 18%
State ArkansasCompany with Most Complaints Bank of AmericaTotal Complaints 235Percent of All Complaints 21%
State ArizonaCompany with Most Complaints Bank of AmericaTotal Complaints 1,492Percent of All Complaints 23%
State CaliforniaCompany with Most Complaints Bank of AmericaTotal Complaints 11,429Percent of All Complaints 26%
State ColoradoCompany with Most Complaints Wells Fargo & CompanyTotal Complaints 855Percent of All Complaints 18%
State ConnecticutCompany with Most Complaints Bank of AmericaTotal Complaints 809Percent of All Complaints 20%
State D.C.Company with Most Complaints Bank of AmericaTotal Complaints 363Percent of All Complaints 20%
State DelawareCompany with Most Complaints Bank of AmericaTotal Complaints 260Percent of All Complaints 15%
State FloridaCompany with Most Complaints Bank of AmericaTotal Complaints 6,768Percent of All Complaints 24%
State GeorgiaCompany with Most Complaints Bank of AmericaTotal Complaints 3,168Percent of All Complaints 25%
State HawaiiCompany with Most Complaints Bank of AmericaTotal Complaints 262Percent of All Complaints 26%
State IowaCompany with Most Complaints Wells Fargo & CompanyTotal Complaints 255Percent of All Complaints 23%
State IdahoCompany with Most Complaints Wells Fargo & CompanyTotal Complaints 183Percent of All Complaints 20%
State IllinoisCompany with Most Complaints JPMorgan Chase & Co.Total Complaints 1,810Percent of All Complaints 17%
State IndianaCompany with Most Complaints JPMorgan Chase & Co.Total Complaints 453Percent of All Complaints 15%
State KansasCompany with Most Complaints Bank of AmericaTotal Complaints 289Percent of All Complaints 22%
State KentuckyCompany with Most Complaints Bank of AmericaTotal Complaints 267Percent of All Complaints 14%
State LouisianaCompany with Most Complaints JPMorgan Chase & Co.Total Complaints 447Percent of All Complaints 20%
State MassachusettsCompany with Most Complaints Bank of AmericaTotal Complaints 1,640Percent of All Complaints 24%
State MarylandCompany with Most Complaints Bank of AmericaTotal Complaints 2,179Percent of All Complaints 22%
State MaineCompany with Most Complaints Bank of AmericaTotal Complaints 249Percent of All Complaints 22%
State MichiganCompany with Most Complaints Bank of AmericaTotal Complaints 1,712Percent of All Complaints 22%
State MinnesotaCompany with Most Complaints Wells Fargo & CompanyTotal Complaints 887Percent of All Complaints 23%
State MissouriCompany with Most Complaints Bank of AmericaTotal Complaints 799Percent of All Complaints 22%
State MississippiCompany with Most Complaints Bank of AmericaTotal Complaints 183Percent of All Complaints 17%
State MontanaCompany with Most Complaints Wells Fargo & CompanyTotal Complaints 106Percent of All Complaints 24%
State North CarolinaCompany with Most Complaints Bank of AmericaTotal Complaints 1,863Percent of All Complaints 21%
State North DakotaCompany with Most Complaints Wells Fargo & CompanyTotal Complaints 50Percent of All Complaints 22%
State NebraskaCompany with Most Complaints Wells Fargo & CompanyTotal Complaints 222Percent of All Complaints 23%
State New HampshireCompany with Most Complaints Bank of AmericaTotal Complaints 474Percent of All Complaints 28%
State New JerseyCompany with Most Complaints Wells Fargo & CompanyTotal Complaints 2,561Percent of All Complaints 19%
State New MexicoCompany with Most Complaints Bank of AmericaTotal Complaints 255Percent of All Complaints 21%
State NevadaCompany with Most Complaints Bank of AmericaTotal Complaints 765Percent of All Complaints 24%
State New YorkCompany with Most Complaints JPMorgan Chase & Co.Total Complaints 4,033Percent of All Complaints 17%
State OhioCompany with Most Complaints JPMorgan Chase & Co.Total Complaints 1,119Percent of All Complaints 12%
State OklahomaCompany with Most Complaints Bank of AmericaTotal Complaints 269Percent of All Complaints 17%
State OregonCompany with Most Complaints Bank of AmericaTotal Complaints 769Percent of All Complaints 22%
State PennsylvaniaCompany with Most Complaints Wells Fargo & CompanyTotal Complaints 1,734Percent of All Complaints 16%
State Rhode IslandCompany with Most Complaints Bank of AmericaTotal Complaints 210Percent of All Complaints 20%
State South CarolinaCompany with Most Complaints Bank of AmericaTotal Complaints 608Percent of All Complaints 20%
State South DakotaCompany with Most Complaints Wells Fargo & CompanyTotal Complaints 89Percent of All Complaints 22%
State TennesseeCompany with Most Complaints Bank of AmericaTotal Complaints 779Percent of All Complaints 19%
State TexasCompany with Most Complaints Bank of AmericaTotal Complaints 3,128Percent of All Complaints 19%
State UtahCompany with Most Complaints Wells Fargo & CompanyTotal Complaints 279Percent of All Complaints 19%
State VirginiaCompany with Most Complaints Bank of AmericaTotal Complaints 1,825Percent of All Complaints 20%
State VermontCompany with Most Complaints Bank of AmericaTotal Complaints 96Percent of All Complaints 16%
State WashingtonCompany with Most Complaints Bank of AmericaTotal Complaints 1,442Percent of All Complaints 24%
State WisconsinCompany with Most Complaints Bank of AmericaTotal Complaints 507Percent of All Complaints 15%
State West VirginiaCompany with Most Complaints JPMorgan Chase & Co.Total Complaints 115Percent of All Complaints 17%
State WyomingCompany with Most Complaints Wells Fargo & CompanyTotal Complaints 50Percent of All Complaints 20%

Experts' Take

For additional context to the data, we sought out experts to answer questions on topics such as banking violations and consumer protections.

Philip Mattera is the Director of the Corporate Research Project of Good Jobs First

1. Have we seen an increase or decrease in banking violations over the last few years? Over the past five years or so, there has been a tsunami of misconduct cases involving major banks. The cases with the biggest settlements and fines -- reaching billions of dollars for banks such as JPMorgan Chase and Bank of America -- involved the sale of toxic securities and mortgage abuses in the period leading up to the financial meltdown of 2008. The big banks have also paid billions to resolve cases concerning practices such as the manipulation of both interest rate benchmarks (especially LIBOR) and foreign exchange markets. We've also seen numerous cases involving credit card abuses and other consumer protection violations. The recently announced case against Wells Fargo for charging fees on accounts created without the customer's knowledge is the latest example.

2. Have there been any big changes to accountability or transparency within the U.S. banking system? The big difference is that the Justice Department and some of the regulatory agencies are willing to impose much bigger penalties than in the past. Also new is the aggressive role of the Consumer Financial Protection Bureau, which in its five years of existence has brought a series of high-profile cases against both large and small financial violators. The unresolved question is whether these larger fines are having the intended deterrent effect or are regarded as a cost of doing business by financial institutions that go on breaking the rules.

3. How can people get involved with promoting greater transparency among banks? Customers who have experienced mistreatment by financial institutions should be sure to file complaints with agencies such as the CFPB, which makes it easy to do so on its website at http://www.consumerfinance.gov/complaint/. The bureau takes these complaints seriously in its enforcement activities. It is also important for the public to express support for the CFPB and other financial regulatory agencies to push back against industry efforts to weaken oversight.

Andrea Luquetta-Kern is the Director of Policy and Research at the California Reinvestment Coalition

1. Do consumers have the right to pursue legal action against banks, if they believe they've been wronged? If not, what can they do?

It depends, but mostly, no. Banks have included forced arbitration clauses to prevent their customers from joining together to sue them. However, the good news is that the Consumer Financial Protection Bureau (CFPB) is proposing rules that will likely eliminate bank's ability to use arbitration clauses with their customers. For right now, we'd recommend reaching out directly to your bank to address this issue, if that fails, a CFPB complaint can help spur action. If you still need redress, you could contact an attorney to confirm whether or not you're bound by an arbitration clause, or if there's a way to still pursue legal action.

2. Do you have any general tips for consumers about how they can improve their chances of resolving a conflict or proving their case to the bank/regulator?

We recommend keeping detailed notes and copies of your statements or documents related to the problem, as well as a log of who you spoke to at the bank (or regulator agency) and what their response was. Social media can also be an effective way to catch the attention of a company.

In terms of regulators, the CFPB has earned a reputation of being one of the most responsive to consumers. Noting the $11 billion in consumer relief the CFPB had obtained in its first four years, Professor Adam Levitin from Georgetown Law School explained:

"These recoveries are even more remarkable given that they include a period of time when the CFPB was still ramping up its staffing and finding its sea legs, and do not include pending actions. In contrast, all of the federal bank regulators combined—the Federal Reserve, FDIC, OCC, OTS, and NCUA—plus the Federal Trade Commission achieved less than a billion in consumer relief over the decade prior to the operation of the CFPB despite these agencies having the very same power as the CFPB to prohibit unsafe and deceptive acts and practices."

3. What are some telltale signs that a consumer's bank is taking advantage of them or engaging in predatory practices?

You should be wary if your bank is trying to sell you something other than what you asked for. If you're interested in a product they're suggesting, do some research, comparison shop, and come back later. You should never respond to hard sales tactics, no matter how good they sound, on the phone or in person. We also recommend checking the CFPB complaint database to see what other customers have experienced. You can filter by company and by product, so for example, you could look up Wells Fargo and bank accounts.

Read your statements regularly, review your transactions, and check for unexpected fees. You can also ask your bank how much you've paid in fees each year. Last, obtain your credit report for free here: https://www.annualcreditreport.com/index.action You can also obtain reports from ChexSystems and Early Warning System.

Jim Angleton is the President of Aegis FinServ Corp

1. Do you think consumers who bank at small region and community banks have a better chance of avoiding predatory practices? Good question. Community banks under $1.5B do not have the talent or manpower to offer diverse programs/products and rely on 3rd party vendors to provide such services under a private label scenario. Larger Community Banks above $1.5B have difficulty with organic growth. Therefore they have multiple departments and are self sufficient. However, they use different measurement tools plus cost center analysis. This can get them into trouble, like [Wells Fargo], by offering small base pay and incentivized structures above certain thresholds of income expectations. The answer is yes, but it is qualified by the size of the institutions. Lastly, Bank Examiners and Regulators have thinned out and they are overwhelmed when conducting routine examinations. When complaints are the reason for examination...they come in as if guns blazing and ready to kick-butt.

2. How about large institutions? The bigger ones, to a certain point are very gamy. Regulators are cautious when writing up bigger banks and citing violations. They know once they issue their exit memorandum and citations for violation of regs, policy and procedures...they could be sued, challenged by official filing of complaint plus objection to findings. They actually are much harsher upon the smaller bank than the big ones.

Methodology

We examined the top 50 retail banks in the United States as measured by their assets. We excluded corporate banks from our listing. The banks were obtained using iBanknet.com. We then scored each bank according to three separate metrics, which we break down below.

Complaints: We looked at over 600,000 complaints dating back to December 2011. They were logged against a number of financial products, including mortgages, credit reporting and bank accounts and services. For example, some banks did not properly credit a mortgage payment, charging consumers a late fee. The CFPB would then track several additional factors – whether the company responded in a timely manner, what the bank’s response was, and whether the company responded in a timely manner.

Regulatory Violations & Penalties: This category allowed us to keep track of how effective banks are at sticking to laws and regulations – most of which are aimed at protecting consumer rights. In our overall ranking, we considered penalties per asset, to control for the size of the institutions. Regulatory are sometimes decided on by scope. Therefore, a large institution violating a law may get fined more because more consumers were affected.

Responsiveness: Finally, it was important to factor in the effectiveness of each institution’s responses to consumer issues. We looked at three factors for this metric: were the responses to complaints timely? Did the institution provide relief to the consumer (either through a refund or a non-monetary compensation)? Did the consumer dispute the bank’s response to the issue? Most institutions responded to complaints in a timely manner 97-99% of the time. Because of this, we put less weight on this factor than the other two.

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