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Federal regulators announced roughly $1.21 billion in penalties against Bank of America for long-running anti‑money‑laundering (AML) failures and violations of U.S. sanctions rules, saying the bank repeatedly failed to detect, escalate and report potentially suspicious activity. The Treasury Department and its enforcement units said the enforcement action follows years of compliance breakdowns that left trillions of dollars in transactions inadequately monitored.
What regulators say they found
Treasury officials, citing reviews by the Financial Crimes Enforcement Network (FinCEN) and the Office of the Comptroller of the Currency (OCC), said Bank of America failed to report more than $5 billion in suspicious transactions on time. That amount included more than $1 billion in activity that regulators tied to national‑security risks, which they described as involving Chinese money‑laundering networks, fraud and potential trade‑based money laundering linked to the southwest border.
The OCC concluded the bank’s transaction‑monitoring system did not properly cover trillions of dollars in transactions, producing large numbers of late suspicious‑activity reports (SARs) involving billions of dollars and transactions that displayed indicators of potential money laundering. Regulators also found the bank had known for years it was failing to refer potentially suspicious activity for investigation but did not fix the problems, the Treasury statement said.
Penalties and legal findings
FinCEN assessed a $1.2 billion penalty against Bank of America, which the agency said includes credit for a $750 million civil penalty imposed earlier by the OCC. The Office of Foreign Assets Control (OFAC) separately reached an $11.6 million settlement, bringing the combined enforcement total to about $1.21 billion. Treasury described the FinCEN sanction as one of the largest in that agency’s history and said the OCC penalty was the largest in the OCC’s history.
As part of the FinCEN settlement, the bank admitted to willfully violating the Bank Secrecy Act by failing to maintain an adequate AML program, by not performing required due diligence on certain foreign bank accounts, and by failing to file SARs as required, according to the enforcement documents summarized by regulators.
Sanctions violations flagged by OFAC
OFAC said its settlement covered 475 apparent violations of U.S. sanctions programs, including activity connected to Iran, Russia, Belarus, Burma and Somalia, as well as transactions tied to narcotics trafficking and global terrorism. The agency said the violations included processing payments through sanctioned banks, permitting certain sanctioned individuals to conduct transactions and failing to promptly update sanctions watchlists.
Bank of America response and financial impact
Bank of America told Fox Business that the penalties will produce a $1.2 billion non‑tax‑deductible charge in its third‑quarter financial results and will reduce net income by about 17 cents per share. In a statement shared with Fox Business, a bank spokesperson acknowledged the violations and said the company has invested “billions of dollars in technology” and dedicated “thousands of employees” to fighting financial crime.
The bank said it worked with regulators to resolve the matters, has made substantial progress addressing the identified deficiencies, remains committed to completing the required improvements, and will continue assisting federal and local law enforcement with financial‑crime investigations.
Remedies, oversight and next steps
Under the enforcement actions, Bank of America must engage an independent third party to review previously undetected suspicious transactions and submit to additional examinations of its AML controls. The company also agreed to expanded sanctions‑compliance commitments covering employee training, testing, audits and cooperation with federal regulators.
Comptroller of the Currency Jonathan V. Gould criticized the bank for failing to remediate known shortcomings despite repeated warnings, according to the OCC’s account. Regulators said the measures imposed are intended to ensure the bank strengthens its controls and prevents future failures.
