Bank of America fined $1.2 billion over money-laundering violations
The action by the Treasury Department was announced less than a day before Bank of America reports quarterly earnings.
Key points
- Bank of America was fined more than $1.2 billion in federal penalties for anti-money-laundering violations.
- The bank failed to report over $5 billion in suspicious transactions, including national security risks.
- The penalties include a $750 million OCC civil money penalty, the largest in its history.
Bank of America was fined more than $1.2 billion in federal penalties on Tuesday after regulators said the bank failed for years to report over $5 billion in suspicious transactions and fix longstanding anti-money-laundering problems. Treasury's Financial Crimes Enforcement Network said the $1.2 billion penalty is the third-largest in Treasury history.
The penalties were announced less than a day before the bank reports quarterly earnings on Wednesday morning. The action also includes an $11.6 million settlement over sanctions violations.
What regulators said
Treasury said more than $1 billion of the unreported activity involved national security and other high-priority risks, including Chinese money-laundering networks and activity tied to the southwest border. The bank admitted it willfully violated the Bank Secrecy Act by failing to maintain a compliant anti-money-laundering program, conduct due diligence on foreign correspondent accounts and file suspicious activity reports.
The Office of the Comptroller of the Currency, in coordination with Treasury, announced a $750 million civil money penalty against the bank, the largest in its history. The OCC accused the bank of serious violations and of failing to fix deficiencies in accordance with a cease-and-desist order it signed in 2024.
Today's actions send a clear message that even the biggest financial institutions are not above the law
— Treasury Secretary Scott Bessent
Bank response and impact
Bank of America said it has invested billions in compliance and is "far along" in remediation efforts. The bank said the penalties will result in a $1.2 billion non-tax-deductible charge in its third-quarter results, reducing net income by about 17 cents per share.
The bank's stock was down about 2% in after-hours trading. The penalties will put renewed focus on longtime CEO Brian Moynihan, who is scheduled to appear on CNBC's "Squawk on the Street" on Wednesday.
