Bank of America fined US$1.21 billion over money laundering failures
The US Treasury fined Bank of America US$1.21 billion for failing to report over US$5 billion in suspicious activity, including US$1 billion tied to national security risks. The penalty, the third-largest in Treasury history, includes a record US$750 million civil penalty from the OCC.
The US Treasury Department has fined Bank of America US$1.21 billion (HK$9.44 billion) for widespread failures in policing potential money laundering and other illicit activity at the nation's second-largest bank. The penalty, announced on Wednesday, is the third-largest in Treasury history.
The Treasury said the bank failed to report over US$5 billion in suspicious activity to the government, including US$1 billion that posed national security-related and other priority illicit finance risks. Treasury Secretary Scott Bessent said in a statement: “Financial institutions are on the front lines of protecting our economic and national security. When a bank of this size fails to meet its anti-money laundering and sanctions obligations, the consequences extend far beyond its own walls, exposing the entire US financial system to significant illicit finance risks.”
The Treasury added that the bank “prioritized its revenues” in building compliance programmes and overly relied on inquiries from outside parties such as law enforcement and other financial institutions instead of its own internal controls. A Bank of America spokesperson said: “Financial crime compliance is serious, and we are responsible for getting it right. We have invested billions of dollars in technology and dedicated thousands of employees to combat financial crime, and our team is far along with and committed to completing the work required to address the issues raised by our regulators.”
The spokesperson added that the bank's third-quarter results, due on Wednesday, will include a non-tax-deductible charge of US$1.2 billion, reducing quarterly net income by approximately 17 cents per share.
As part of the fine, the Office of the Comptroller of the Currency (OCC) levied a US$750 million civil penalty against the lender, the largest ever for the regulator, citing failures to address shortcomings in its anti-money laundering programmes identified in a 2024 cease-and-desist order. The regulator said the bank's compliance programme was “deficient and ineffective”, and its transaction monitoring system caused delays in filing suspicious activity reports on billions of dollars of transactions.
Additionally, the bank paid an US$11.6 million fine to the Office of Foreign Assets Control for over 400 apparent violations of numerous sanctions programmes. The Treasury said the bank mistakenly processed millions of dollars in payments that violated sanctions targeting countries including Russia and Iran.