Bank of America has been fined $1.21 billion by the U.S. government for extensive failures to adequately monitor for and report suspicious financial activities, according to the Treasury Department. The penalty is the third-largest ever imposed by the department.
The Treasury stated that the bank failed to report over $5 billion in suspicious activity, including $1 billion that posed national security-related and other priority illicit finance risks. The department found that Bank of America prioritized revenue over compliance, relying excessively on external inquiries rather than robust internal controls.
"Financial institutions are on the front lines of protecting our economic and national security," Treasury Secretary Scott Bessent said in a statement. "When a bank of this size fails to meet its anti-money laundering and sanctions obligations, the consequences extend far beyond its own walls, exposing the entire US financial system to significant illicit finance risks."
A spokesperson for Bank of America acknowledged the seriousness of financial crime compliance and stated that the bank has invested billions in technology and personnel to combat financial crime. The spokesperson added that the bank is committed to addressing the issues raised by regulators.
The bank's third-quarter results are expected to include a $1.2 billion charge, reducing quarterly net income by approximately 17 cents per share. Bank of America shares were down 1.8% in after-hours trading following the announcement.
In addition to the Treasury's action, the Office of the Comptroller of the Currency levied a $750 million civil penalty against the bank, the largest ever for the agency. This penalty was issued due to persistent failures in the bank's anti-money laundering programs, which were identified in a 2024 cease-and-desist order. The OCC deemed the bank's compliance program "deficient and ineffective," noting that its transaction monitoring system led to delays in reporting billions of dollars in transactions.
Furthermore, the bank paid an $11.6 million fine to the Office of Foreign Assets Control for over 400 apparent violations of sanctions programs. The Treasury indicated that the bank mistakenly processed millions of dollars in payments that violated sanctions targeting countries including Russia and Iran.
This action against Bank of America follows a $350 million penalty imposed on American Express National Bank just days prior for similar anti-money laundering shortcomings.