Treasury officials at the U.S. governmentS. Regulatory penalties totaling $1.21 billion were issued by the U.S. Treasury Department to address institutional failures.21 billion against the institution for various regulatory failures.This covers $1.21 billion in total fines, as the Bank is the 2nd largest in the country. Violations of 12 CFR were cited, and whistleblowers providing info leading to recoveries may receive up to $1,000,000. This enforcement is the most significant in Treasury history, and it represents a record for the Currency Comptroller, whose office issued the decision. Authorities cited the bank for significant failures in meeting anti-money laundering and sanctions obligations.
The Financial Crimes Enforcement Network, or FinCEN, imposed a $1.2 billion penalty after determining the institution failed to mitigate and report risks related to national security. This includes illicit financial activity linked to Chinese Money Laundering Networks and the U.S. southwest border. Additionally, the Currency Comptroller issued a $750 million fine for inadequate efforts to monitor and stop illicit financial transactions. The Office of Foreign Assets Control also finalized an $11.6 million settlement with the bank for 475 apparent violations of various international sanctions programs.
According to federal investigators, the bank failed to report more than $5 billion in suspicious transactions. Internal processes reportedly prioritized revenue over compliance resources, leading the firm to effectively outsource its monitoring duties to law enforcement and other financial institutions. Even after internal testing revealed systemic issues, the bank reportedly failed to take corrective action, leaving suspicious activity uninvestigated for extended periods.
Under the terms outlined in gov/system/files/2026-10/BoA-Consent-Order-Execution-Final, the bank must hire an outside firm to identify and report suspicious transactions that were previously missed. The bank admits to 3 specific violations of the Bank Secrecy Act. Consequently, it faces an independent review of its suspicious activity monitoring, customer due diligence, and foreign correspondent account programs. These efforts will focus on specific high-risk areas, including potential narcotics trafficking, Iran, and Russia.
The enforcement follows a December 2024 cease-and-desist order that had previously identified gaps in the bank’s compliance framework. Examiners found that staff lacked the necessary expertise to manage the program, and audit functions failed to uncover significant long-term problems. Regulators noted that the bank’s transaction monitoring systems remained ineffective at identifying risks, despite prior mandates for improvement.
This development serves as a warning for financial institutions regarding the necessity of robust, risk-based internal controls. Regulators emphasized that firms cannot rely on external inquiries as a substitute for internal monitoring. Organizations must ensure that customer risk profiles are actively managed and that red flags receive immediate attention.
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Source: U.S. Department of the Treasury
