The U.S. Treasury Department has hit Bank of America, the second-largest bank in the United States, with more than $1.21 billion in penalties over violations of anti-money laundering and sanctions laws, the department announced on Tuesday. The enforcement actions include the third-largest penalty in Treasury history and the largest fine ever issued by the Office of the Comptroller of the Currency, the bank's primary federal regulator.
The centerpiece of the package is a $1.2 billion penalty assessed by the Financial Crimes Enforcement Network, the Treasury's financial-crimes watchdog. According to the department, the bank failed to mitigate and report what it described as priority national security risks, including Chinese money laundering networks and illicit finance flowing along the country's southwestern border.
Regulators said Bank of America's problems ran deep in the machinery meant to catch dirty money. The Treasury pointed to deficiencies in the bank's systems for identifying and reporting suspicious transactions and in its customer due diligence — the checks banks are required to perform to know who their clients are and where their money comes from. In unusually blunt language, the department said the bank had effectively outsourced a substantial share of its detection and reporting obligations to outside parties.
The scale of what went unreported was striking. The Treasury said Bank of America failed to report more than $5 billion in suspicious transactions to FinCEN in a timely manner — transactions that, by law, should have triggered immediate alerts to federal investigators.
A second action came from the Office of the Comptroller of the Currency, which assessed a $750 million fine over the bank's deficient and ineffective anti-money laundering compliance program. The Treasury noted that the OCC's fine is the largest in that agency's history, and that FinCEN's $1.2 billion penalty includes credit for the OCC's action.
The third enforcement action targeted the bank's sanctions compliance. The Treasury's Office of Foreign Assets Control announced an $11.6 million settlement covering 475 apparent violations of multiple U.S. sanctions programs, including restrictions related to Iran, Russia, narcotics trafficking, and global terrorism. Under the settlement, the bank accepted significant compliance commitments around training, testing, auditing, and future cooperation with OFAC.
Treasury Secretary Scott Bessent framed the action as a warning to the entire industry. When a bank of this size falls short on anti-money laundering and sanctions obligations, he said, the consequences reach well beyond its own walls and expose the whole U.S. financial system to illicit finance risks. He added that the penalties send a clear message that even the largest financial institutions are not above the law.
Bank of America responded in a statement, acknowledging that it is responsible for getting financial crime compliance right. The bank said it has invested billions of dollars in technology and dedicated thousands of employees to combating financial crime, and that its team is well along in the work required to address the issues raised by regulators.
The penalty lands at a moment of intensifying pressure on global banking compliance. U.S. regulators have steadily escalated enforcement against banks that fail to police suspicious flows, particularly where illicit finance intersects with national security concerns. For a bank of Bank of America's size — with trillions of dollars in assets and tens of millions of American customers — the finding that core detection functions were handed off to third parties is likely to reverberate across the industry.
The action also fits a broader pattern of the administration's hard line on sanctions enforcement. Just days ago, NewsPulse reported on Washington's decision to sanction the International Criminal Court and issue an ultimatum to its member states — a sign of how willing the current government is to wield financial weapons, both against foreign institutions and, as Tuesday's case shows, against domestic giants.
What happens next will be closely watched. The bank's commitments to overhaul its compliance program will be measured by regulators in the months ahead, and Tuesday's record-setting penalties raise the stakes for every major lender that treats anti-money laundering obligations as a box-checking exercise. As federal officials made clear, the days of settling for fines as a cost of doing business may be ending.