Bank of America agreed to pay a $1.21bn penalty to U.S. regulators after the Treasury said the lender failed to file reports on more than $5bn in suspicious transactions, including $1bn tied to national‑security risks. The settlement follows a 2024 cease‑and‑desist order that flagged systemic compliance gaps.
Treasury officials said the unreported activity stretched from Chinese money‑laundering networks to trade‑based schemes along the U.S. southwest border. It also covered sanctions violations against Russia, Iran, drug traffickers and global terrorism.
The OCC imposed a $750m civil fine, its largest ever, citing a 2024 order that called BOA’s anti‑money‑laundering program "deficient and ineffective". The bank also agreed to pay $11.6m to OFAC for 475 alleged sanctions breaches.
BOA said it had invested billions in technology and staff to fight financial crime, but regulators say it outsourced much of the responsibility to external inquiries.
The company will hire an independent third party to audit past transactions and report any missed suspicions to FinCEN. Its Q3 earnings will reflect a $1.2bn non‑tax‑deductible charge, trimming net income by about 17 cents per share.
Shares slipped 2.7% in after‑hours trading, following a 1.1% fall at market close, as investors weighed the new compliance burden.