Bank of America has been ordered to pay a $1.2 bn (£910 m) penalty after U.S. Treasury officials said the bank failed to detect and report a range of suspicious transactions. The enforcement action, announced on Tuesday, represents the third‑largest fine the Treasury department has ever imposed.
Regulatory findings
According to the Treasury, Bank of America did not file reports on more than $5 bn in activity that appeared suspicious, including roughly $1 bn that presented national‑security and illicit‑finance risks. The agency highlighted specific lapses such as the bank’s failure to flag transactions that may have involved Chinese money‑laundering networks and trade‑based laundering tied to the U.S. southwest border.
Officials said the bank relied heavily on external inquiries—from law‑enforcement bodies and other financial institutions—rather than on its own internal controls. Treasury Secretary Scott Bessent warned that when a large institution neglects anti‑money‑laundering and sanctions obligations, the repercussions extend beyond the firm to the broader U.S. financial system.
Bank’s response and financial impact
Bank of America, speaking to the BBC, said its team is “far along with and committed to completing the work required to address the issues raised by our regulators.” In an emailed statement, the bank confirmed that the $1.2 bn charge will appear as a non‑tax‑deductible expense in its third‑quarter earnings, reducing net income by about 17 cents per share. The bank added that it has already allocated substantial personnel and resources to remediation, and that those costs are reflected in its current expense base.
The announcement of the fine came less than 24 hours before the bank was scheduled to release its quarterly earnings on Wednesday morning.
Details of the penalties
The settlement includes penalties from two separate regulators. The Office of the Comptroller of the Currency (OCC) imposed a $750 m fine, the largest penalty the agency has ever levied. The Office of Foreign Assets Control (OFAC) assessed a separate $11.6 m settlement tied to 475 apparent violations of U.S. sanctions programs, including those related to Russia, Iran, narcotics trafficking and global terrorism. OFAC characterized the violations as “non‑egregious.”
As part of the agreement, Bank of America admitted that it “willfully violated” the Bank Secrecy Act by failing to maintain a compliant anti‑money‑laundering program, neglecting due‑diligence requirements on foreign correspondent accounts, and not filing required suspicious activity reports.
The combined penalties underscore heightened regulatory scrutiny of large financial institutions and signal a willingness by U.S. authorities to impose substantial financial consequences for systemic compliance failures.
Helene Elliott is the Lead Science & Space Reporter at News Raise. She reports on aerospace missions, astrophysics discoveries, quantum research, and environmental technology.
