The U.S. Treasury Department announced a fine of more than $1.2 billion against Bank of America.
Regulators accused the country’s second-largest bank of serious violations of anti-money laundering and sanctions laws.
According to the Treasury, the bank failed to properly detect and report priority national security risks. These included Chinese money-laundering networks and illicit finance along the southwest border of the United States. As a result of this non-detection, Bank of America failed to report suspicious transactions worth more than $5 billion to the Financial Crime Enforcement Commission. Out of this amount, $1 billion pertained to national security and other serious cases, such as the crime of trade-based money laundering.
Treasury Secretary Scott Bessent stressed the seriousness of the situation.
“When a bank of this size fails to meet its anti-money laundering and sanctions compliance obligations, the consequences extend far beyond its walls, exposing the entire U.S. financial system to significant illicit finance risks,” he said. He added: “Today’s actions make clear that even the largest financial institutions are not above the law.”
As part of the overall penalty, the Office of the Comptroller of the Currency (OCC) imposed a $750 million civil money penalty, the largest in its history. FinCEN counted this amount toward the $1.2 billion total. The Office of Foreign Assets Control took a separate settlement with the bank for $11.6 million as a result of alleged violations of restrictions imposed on Iran as well as on Russia, drugs and worldwide terrorism.
Bank of America publicly acknowledged their intention to turn a blind eye to basic procedures to detect any wrongdoing. The bank processed more than $9 trillion in transactions last year, yet its monitoring systems suffered from breakdowns. Even after compliance staff escalated concerns, the response to suspicious customer activity, including activity linked to drug trafficking, remained slow and ineffective. An error in the sanctions-screening system meant that transactions matching a name and date of birth on the Treasury’s sanctions list were not always flagged as high priority.
The bank said it is working with regulators to fulfill the settlement terms. It has invested billions of dollars in technology and assigned thousands of employees to combat financial crime. According to the company, its team has made significant progress in addressing the issues raised by regulators and is determined to complete the work. The bank continues to support federal and local law enforcement agencies in thousands of investigations and files hundreds of thousands of suspicious activity reports each year.
The fine will affect third-quarter results. The company will record a non-tax-deductible charge of $1.2 billion, reducing net income by approximately 17 cents per share. Substantial resources devoted to remediation are already included in the current expense base.
This penalty ranks as the third-largest in FinCEN history, after the $3.4 billion fine against Binance in 2023 and the $1.3 billion penalty against TD Bank in 2024. Unlike those cases, the Justice Department has taken no action. It is also the largest anti-money-laundering fine imposed on a major bank by the Treasury under the Trump administration.
Following the announcement, Bank of America shares fell more than 2.5% in after-hours trading. Critics note that even a fine of this size appears modest relative to the bank’s earnings and stress the need for personal accountability among senior executives. Regulators, for their part, are sending a clear signal: if problems are not fixed quickly, significant monetary penalties and other measures, including personnel actions, will follow.
