Treasury Hits Bank of America with $1.21 Billion Fine for Money-Laundering Failures

WASHINGTON — The U.S. Department of the Treasury has announced more than $1.21 billion in penalties against Bank of America, the nation's second-largest bank, for widespread failures to police money laundering and comply with American sanctions laws.

The enforcement package, announced Tuesday, is the third-largest penalty in Treasury Department history and includes the largest fine the Office of the Comptroller of the Currency (OCC) has ever imposed on a bank.

Treasury said Bank of America failed to report more than $5 billion in suspicious activity to the government — including about $1 billion in transactions Treasury says posed national security-related risks, such as suspected Chinese money-laundering networks and illicit finance along the southwestern border.

The bank "admitted that it willfully violated" the Bank Secrecy Act, the main U.S. anti-money laundering law, Treasury said. Regulators said the bank's anti-money laundering compliance program was "deficient and ineffective," noting the bank had been ordered to fix it under a 2024 cease-and-desist order and failed to do so.

Treasury also accused the bank of prioritizing revenues over compliance, relying on outside tips instead of its own internal controls to catch illicit activity.

The breakdown: FinCEN assessed a $1.2 billion civil money penalty for anti-money laundering failures from at least 2018 through mid-2025. The OCC levied a $750 million civil penalty — the largest in its history — credited toward the FinCEN fine. The Office of Foreign Assets Control (OFAC) reached an $11.6 million settlement over apparent sanctions violations involving Iran, Russia, narcotics, and global terrorism programs. Between 2021 and 2025, the bank committed over 475 apparent sanctions violations, including processing more than $14.3 million in payments through 35 sanctioned "blocked banks."

"Financial institutions are on the front lines of protecting our economic and national security," Treasury Secretary Scott Bessent said. "When a bank of this size fails to meet its anti-money laundering and sanctions obligations, the consequences extend far beyond its own walls."

A Bank of America spokesperson said the bank had invested billions in technology and thousands of employees to fight financial crime, and that its third-quarter results — due Wednesday — will include a $1.2 billion non-tax-deductible charge, reducing quarterly net income by about 17 cents per share. Shares fell in after-hours trading.

The action lands one day before the bank's quarterly earnings report and signals the administration's willingness to bring record enforcement actions against the country's biggest financial institutions. Treasury called it a clear message: "even the biggest financial institutions are not above the law."

Sources

• Reuters
• Dow Jones Newswires (via Morningstar)
• Barron's