Bank of America was hit with more than $1.2 billion in penalties on Tuesday after U.S. regulators said the bank failed to stop money laundering and other illicit financial activity. The punishment includes a $1.2 billion penalty from FinCEN and a $750 million penalty from the OCC, which will be credited against the larger assessment rather than added on top of it.
Scott Bessent said even the biggest financial institutions are not above the law, and that line landed hard because the case is built around failures that regulators say stretched across the bank’s core defenses. Bank of America said the fines will include a non-tax-deductible charge of $1.2 billion that will cut net income by about 17 cents per share in its third quarter results, just as the bank was set to report earnings Wednesday morning.
The Treasury Department said the bank failed to properly monitor trillions of dollars in transactions and missed more than $5 billion in suspicious activity, including transactions potentially tied to Chinese money-laundering networks, narcotics trafficking and fraud. FinCEN said Bank of America admitted to willfully violating the Bank Secrecy Act, while Treasury said it had effectively outsourced substantial parts of suspicious activity detection to law enforcement and other financial institutions.
That history matters because the latest penalties came nearly two years after Bank of America agreed to a December 2024 cease-and-desist order requiring it to fix longstanding anti-money laundering weaknesses. Regulators said the problems were not confined to one control or one desk: they ran through transaction monitoring systems, customer due diligence and internal oversight, and the OCC said the bank did not make sufficient progress after the earlier order.
Bank of America said it had invested billions of dollars in technology and deployed thousands of employees to combat financial crime. Regulators said that did not translate into adequate controls, and Treasury said suspicious transactions went uninvestigated for extended periods. Jonathan Gould said the bank’s poor response to its Bank Secrecy Act deficiencies is unacceptable.
The bank also disclosed an $11.6 million sanctions settlement tied to 475 apparent violations involving Russia, Iran and other countries and activities, bringing the total penalties to more than $1.21 billion. Bank of America, based in Charlotte, North Carolina, said it must now review previously undetected suspicious transactions with an outside party and undergo independent compliance assessments, a sign that the cleanup phase is just beginning.
