The U.S. Treasury Department on Tuesday imposed more than $1.21 billion in penalties on Bank of America, saying America’s second-largest bank for years ran anti-money-laundering controls that were too weak to catch priority national-security risks, including Chinese money-laundering networks and illicit finance along the southwest border.
What regulators announced
The Financial Crimes Enforcement Network assessed a $1.2 billion civil penalty, which Treasury described as the third-largest in its history. The Office of the Comptroller of the Currency levied a separate $750 million assessment—the largest in OCC history—that is credited against the FinCEN total so the bank is not paying both sums in full.
Treasury said Bank of America admitted it willfully violated Bank Secrecy Act regulations and failed to timely report more than $5 billion in suspicious transactions. Some of that activity, officials said, posed national-security concerns rather than ordinary consumer fraud.
In a parallel action, the Office of Foreign Assets Control announced an $11.6 million settlement over apparent sanctions violations tied to Iran, Russia, narcotics trafficking and global terrorism programs.
Where the bank fell short
Regulators focused on monitoring gaps that left high-risk corridors under-reported. FinCEN cited failures to mitigate and report flows associated with Chinese money-laundering networks, as well as suspicious activity along the U.S. southwest border—an area where Treasury has pressed banks to tighten correspondent and cash-intake controls as cartel finance routes shift.
The OCC said the bank remained subject to a December 2024 cease-and-desist order requiring it to fix deficient Bank Secrecy Act and anti-money-laundering programs. Tuesday’s penalty action was coordinated between FinCEN and the OCC, with remedial requirements attached to the FinCEN assessment.
Wall Street Journal reporting on the settlement noted regulators concluded Bank of America had insufficient systems to monitor possible financial crimes, including underground banking activity, and that more than $5 billion in suspicious activity went unreported to authorities.
What Bank of America said
Bank of America told CNBC it has invested heavily in financial-crime compliance and that the penalties will result in a roughly $1.2 billion non-tax-deductible charge in third-quarter results, cutting net income by about 17 cents per share. Spokesperson Christa Robinson said the costs are already reflected in the bank’s expense base and that “financial crime compliance is serious, and we are getting it right.”
Shares of Bank of America slipped in after-hours trading following the announcement, as investors weighed whether the fine closes a long-running AML chapter or signals further supervisory scrutiny.
What happens next
Treasury did not announce a criminal referral Tuesday, framing the package as civil enforcement with mandated remediation. Compliance officers at other large U.S. banks will watch whether FinCEN publishes detailed consent terms that set new expectations for border-adjacent monitoring and China-linked typologies.
Congressional banking committees may seek briefings on how $5 billion in suspicious activity accumulated without timely Suspicious Activity Report filings, especially where national-security risk was flagged internally. For Bank of America, the immediate task is proving to examiners that the 2024 order’s fixes are operational—not just on paper—before the next OCC cycle.