Treasury fines Bank of America $1.2 billion over money-laundering lapses

The Treasury Department said Tuesday that Bank of America will pay more than $1.21 billion combined to three federal units to settle findings that the bank failed for years to detect, investigate and report billions of dollars in transactions tied to money laundering and sanctions violations. The Treasury Department's announcement described the combined penalty as the third-largest in the department's history.

The Financial Crimes Enforcement Network, or FinCEN, assessed the largest share, a $1.2 billion penalty, saying in its enforcement release that Bank of America failed to mitigate and report "priority national security risks," including Chinese money-laundering networks and illicit finance moving along the southwest border. As part of the resolution, the bank admitted it willfully violated the Bank Secrecy Act, did not maintain an anti-money-laundering program meeting the law's minimum standards, skipped required due diligence on correspondent accounts held by foreign banks, and failed to file required suspicious activity reports on more than $5 billion in transactions.

Regulator cites years of unresolved gaps

The Office of the Comptroller of the Currency separately imposed a $750 million civil money penalty, which it credited against FinCEN's larger fine rather than adding to the total. The OCC called it the largest penalty in the agency's history. Examiners found the bank's transaction-monitoring system too deficient to adequately track trillions of dollars in activity, producing suspicious activity reports that were both late and, in many cases, inaccurate. The OCC said the bank's staff overseeing Bank Secrecy Act compliance lacked adequate training, and that an internal audit function missed long-standing problems examiners later uncovered on their own.

Comptroller of the Currency Jonathan Gould said the bank's record showed sustained failure to fix known weaknesses. "The OCC expects all banks to have an effective BSA/AML compliance program," Gould said, adding that "the bank's poor response to its BSA deficiencies is unacceptable." The agency noted the bank remains under a cease-and-desist order issued in December 2024 and had still not completed many of the steps that order required more than a year later.

The Office of Foreign Assets Control added a third, smaller settlement: $11.6 million over 475 apparent violations across sanctions programs covering Russia, Belarus, Iran, Burma, Somalia, narcotics trafficking and global terrorism. OFAC classified the violations as non-egregious. Treasury said the apparent breaches included channeling correspondent payments through blocked banks, permitting transactions by sanctioned individuals, and failing to promptly update internal watchlists.

Treasury Secretary Scott Bessent framed the action as part of a broader push to police bank compliance. "Financial institutions are on the front lines of protecting our economic and national security," Bessent said in the department's statement.

Under its consent order with FinCEN, Bank of America must now hire an independent party to conduct a "lookback" review of transactions dating to January 2022 to identify any additional suspicious activity that went unreported, along with independent reviews of its anti-money-laundering, customer due-diligence and data-governance programs. Reporting by The Associated Press and The Washington Post noted the bank, the country's second-largest by assets, had not issued a public statement responding to the penalties as of Tuesday afternoon. A separate account from the watchdog group OCCRP noted regulators found the bank had failed to report transactions with signs of narcotics-trafficking proceeds moving through its accounts.

Bank of America reported third-quarter results on October 14, one day after the Treasury announcement; its earnings release made no mention of the FinCEN, OCC or OFAC settlements, and the bank has not said publicly how the $1.21 billion in penalties will be reflected in its financial statements.