BofA gets $1.21B penalty for money laundering

• Key insight: The Treasury Department  on Tuesday announced $1.21 billion in penalties against Bank of America for anti-money-laundering and sanctions violations.
• Supporting data: The Office of the Comptroller of the Currency's fine follows a December 2024 cease-and-desist order, over a year after which regulators found the bank had failed to address holes in compliance.

The Department of the Treasury on Tuesday announced a $1.21 billion penalty against Bank of America for willful anti-money laundering and sanctions violations, including failing to report over $5 billion dollars in suspicious transactions, $1 billion of which reportedly had national security implications. 

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In addition to the $1.2 billion fine from Treasury's Financial Crimes Enforcement Network, the Office of the Comptroller of the Currency issued a $750 million civil money penalty. The Bank also reached a $11.6 million settlement with the Treasury's Office of Foreign Assets Control.

"Financial institutions are on the front lines of protecting our economic and national security," said Treasury Secretary Scott Bessent. "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 U.S. financial system to significant illicit finance risks. Today's actions send a clear message that even the biggest financial institutions are not above the law."

According to a Treasury release, between September 2021 and April 2025, Bank of America committed over 475 U.S. sanctions violations, including processing over $14.3 million in payments through 35 "blocked banks" on the U.S.'s sanctions blacklist, involving sanctions against a number of countries, including Russia, Iran, Burma and Somalia, as well as known drug traffickers and terrorist organizations. In its release, OFAC said Bank of America acted "recklessly" and had previously received multiple cautionary letters regarding "substantially similar conduct."

According to the Treasury, the bank was aware in March 2022 that its payment directory included sanctioned banks, but that due to a combination of outdated screening filters, human error and technological failings, payments continued to these entities. The bank did conduct a review, but did not identify the full scope of the transactions until after OFAC subpoenaed the firm in January 2025. 

The $750 million penalty imposed by the OCC follows up on an existing enforcement action.  The bank was already subject to a December 2024 cease-and-desist order requiring it to address deficiencies in its anti-money laundering program, but regulators found that a year after the 2024 action, the firm still had not taken key steps to remediate the shortcomings. 

"More than a year after the 2024 Order, the Bank still failed to escalate potentially suspicious activities to investigators for review," the Treasury release noted. "Bank management failed to ensure the Bank had an effective BSA/AML compliance program and continued to minimize the program's significant deficiencies."

As part of the settlement, the bank must conduct a third-party lookback to find previously undetected suspicious transactions, as well as submit to independent reviews of its anti-money laundering governance, with particular attention to risks related to sanctioned jurisdictions.

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Bank of America did not immediately respond to requests for comment on the enforcement actions. 

The action comes less than a week after regulators issued large settlements against another major bank. The Federal Reserve and Office of the Comptroller of the Currency, in separate, coordinated cease-and-desist actions fined American Express' banking arm $350 million on Thursday for insufficient anti-money-laundering controls, while the Federal Reserve ordered Amex's parent companies to address financial-crime deficiencies across the enterprise. The OCC, which fined Amex $350 million as part of its enforcement action, said they identified roughly $13 billion in illicit activity at the firm, including transactions with ties to bank "insiders."

The settlements mark the largest Treasury fine ever imposed on a bank and the third largest in OCC history.