Bank of America Hit With $1.2 Billion in Record-Setting Treasury Penalties

The U.S. Treasury Department announced on Tuesday that it is imposing more than $1.21 billion in penalties on Bank of America, the nation’s second-largest bank. Officials say the lender violated anti-money laundering and sanctions laws. The combined action ranks as the third-largest penalty in the department’s history.

Three federal agencies took part in the enforcement, each targeting a different failure at the bank. The package also includes the largest fine the Office of the Comptroller of the Currency has ever imposed. Treasury says the bank admits it willfully violated a decades-old law designed to stop dirty money from moving through the financial system.

Treasury Warns Even the Biggest Banks Face Consequences

Treasury Secretary Scott Bessent framed the penalties as a warning to the entire industry. He stressed that a lapse at a bank of this size reaches well beyond its own operations.

“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,” Treasury Secretary Scott Bessent said in a statement. “Today’s actions send a clear message that even the biggest financial institutions are not above the law.”

The department did not stop at the headline figure. It laid out a series of compliance breakdowns that, in its view, left the bank exposed to national security threats. Those threats include organized laundering networks and illicit finance moving across the border.

FinCEN Targets Chinese Laundering Networks and Border Risks

The Financial Crimes Enforcement Network, known as FinCEN, assessed a $1.2 billion penalty. Treasury said the penalty responds to the bank’s “failure to mitigate and report priority national security risks, including Chinese Money Laundering Networks and illicit finance along the southwest border.” Investigators found deficiencies in how the bank identified and reported suspicious transactions, as well as in its customer due diligence processes.

The statement also criticized how the bank handled its detection duties. Treasury said that “the Bank effectively outsourced to third parties a substantial portion of its proactive detection and reporting obligations.” In other words, the regulators argue the bank handed away work that the law expects it to perform itself.

The scale of the unreported activity stands out. Treasury said Bank of America failed to report more than $5 billion in suspicious transactions on time. That total includes over $1 billion linked to national security and other priority financial crime risks.

How the Penalties Break Down

The $1.2 billion FinCEN penalty is not a standalone sum added to everything else. It includes credit for a separate fine from the Office of the Comptroller of the Currency, or OCC. The OCC assessed $750 million over what it called the bank’s deficient and ineffective anti-money laundering compliance program. That amount is the largest fine in the agency’s history, and it will go to the OCC.

A third agency added its own action. The Office of Foreign Assets Control, or OFAC, announced an $11.6 million settlement with the bank. The agency cited “apparent violations of numerous sanctions programs, including on Iran, Russia, narcotics, and global terrorism.” Together, the three actions push the total past the $1.21 billion figure Treasury announced.

• FinCEN: $1.2 billion, including credit for the OCC fine
• OCC: $750 million, the largest in the agency’s history
• OFAC: $11.6 million settlement over sanctions violations

A Violation of the Bank Secrecy Act

Treasury said Bank of America “admits that it willfully violated” the 1970 Bank Secrecy Act. The law requires banks to help the government detect and prevent money laundering. A willfulness finding carries particular weight because it moves the case beyond simple oversight and into knowing noncompliance.

The admission also connects to earlier regulatory scrutiny. The bank said the resolutions stem from violations cited in a previously reported 2024 consent order from the Comptroller of the Currency, along with FinCEN’s investigation. That history shows regulators had flagged the problems well before Tuesday’s announcement.

Bank of America Responds

The bank acknowledged the seriousness of the findings and said it has worked with regulators to resolve them. It also pointed to the resources it has committed to fixing its controls.

“Financial crime compliance is serious, and we are responsible for getting it right,” Bank of America said in a statement. “We worked with regulators to reach these penalty resolutions stemming from violations cited in the previously reported 2024 (Comptroller of the Currency) Consent Order and FinCEN’s investigation.

“We have invested billions of dollars in technology and dedicated thousands of employees to combat financial crime, and our team is far along with and committed to completing the work required to address the issues raised by our regulators.”

Where the Penalty Ranks in Treasury History

The latest action is the third-largest penalty the Treasury Department has ever issued. Only two settlements rank higher. The first was a roughly $4 billion settlement in 2023 with Binance, the world’s largest cryptocurrency exchange. The second was an approximately $3 billion settlement with Canada-based TD Bank the following year.

Bank of America now joins a short list of institutions that have faced the largest financial crime penalties the department has imposed. The case also shows how regulators are treating compliance failures at systemically important lenders. Treasury’s message is that size offers no protection, and that outsourcing detection work does not outsource responsibility.

For the bank, the immediate task is finishing the remediation work it says is well underway. For the wider industry, the penalties set a clear marker for what regulators expect from suspicious transaction reporting, customer due diligence, and sanctions screening. The size of the unreported transactions, more than $5 billion, helps explain why the penalties reached this level.