Bank of America faces $1.2 billion penalty for anti-money laundering violations

<p>The Treasury Department announced on October 13, 2026, penalties exceeding $1.2 billion against Bank of America for failing to report suspicious transactions and for deficiencies in its anti-money-laundering program.</p><p>The action represents the third-largest penalty in the history of the Treasury Department.</p><hr /><p>Treasury Secretary Scott Bessent stated in a press release, "Today's actions send a clear message that even the biggest financial institutions are not above the law."</p><p>The civil action follows a recent $350 million fine imposed on American Express for similar issues related to detecting and reporting suspected money laundering.</p><p>Bank of America admitted to willfully violating federal anti-money-laundering laws, which included failing to maintain adequate safeguards and report suspicious transactions.</p><ul><li>Regulators indicated that the bank did not properly monitor trillions of dollars in transactions, leading to over $5 billion in suspicious activity that was either unreported or reported late.</li><li>Of this amount, more than $1 billion was linked to potential national security risks, including connections to Chinese money-laundering networks and suspected trade-based money laundering associated with the U.S.-Mexico border.</li></ul><p>The Office of the Comptroller of the Currency also imposed a civil penalty of $750 million, marking the largest penalty in the agency's history.</p><ul><li>Additionally, the Treasury announced an $11.6 million settlement with Bank of America for hundreds of apparent violations of U.S. sanctions, including those targeting Russia and Iran.</li></ul><p>Bank of America has been addressing deficiencies in its anti-money-laundering program since a regulatory order issued in December 2024, but regulators noted that significant issues remain.</p><ul><li>Officials reported that the bank prioritized revenue over compliance resources, at times depending on law enforcement and external sources to identify suspicious activity.</li></ul><p>In response, Bank of America stated that it has invested billions in technology and dedicated thousands of employees to combat financial crime, asserting that it is committed to resolving the issues raised by regulators.</p><ul><li>The bank indicated that it is making progress in addressing these compliance issues.</li></ul><p>Bank of America is scheduled to report its third-quarter earnings on Wednesday and has indicated it will record a $1.2 billion, non-tax-deductible charge in its financial results.</p><ul><li>The bank noted that costs related to its ongoing compliance improvements are already included in its expenses.</li></ul><p>This story has been updated with additional details.</p>