Bank of America hit with more than $1.21 billion in penalties over compliance failures
Key Facts
The U.S. Treasury Department announced on October 13, 2026, penalties totaling more than $1.21 billion against Bank of America over anti-money laundering and sanctions compliance failures. The actions include a fine imposed by the Financial Crimes Enforcement Network and a settlement with the Office of Foreign Assets Control over apparent sanctions violations. As part of its settlement with the Financial Crimes Enforcement Network, the bank admitted to willfully violating the Bank Secrecy Act. The Treasury Department described the actions as including the third-largest penalty in its history, placing the settlement among its most significant enforcement actions. It also said the penalty imposed by the Office of the Comptroller of the Currency was the largest in that agency's history.
The settlement weighed on the bank's results for the third quarter of fiscal 2026, which included a $1.2 billion regulatory charge, according to its filing with the U.S. Securities and Exchange Commission. The charge reduced earnings per share by $0.17, directly affecting reported earnings. Reported net income was $6.9 billion, with earnings per share of $0.91. Excluding the settlement charge, the bank reported adjusted, non-GAAP net income of about $8.1 billion and adjusted earnings per share of $1.08. The settlement charge came in a quarter when revenue rose 3% year on year to $30.0 billion.
The Financial Crimes Enforcement Network's $1.2 billion fine is the main component of the penalties announced against the bank. That amount includes a $750 million penalty imposed by the Office of the Comptroller of the Currency, according to the agency's statement on the settlement. The Office of Foreign Assets Control settlement totals $11,662,930 and covers the bank's potential civil liability for apparent sanctions violations. That action covers 475 apparent violations, according to settlement details released by the agency. The violations covered by the action occurred between September 18, 2021, and April 24, 2025.
Explaining the reasons for the actions, the Treasury Department said the bank "prioritized its revenues" in handling its regulatory obligations. It added that the bank downplayed the impact of compliance problems on the resources allocated to meeting those obligations. The Office of the Comptroller of the Currency found that the Bank Secrecy Act officer and staff lacked sufficient skills and experience to manage the compliance program effectively. The agency said shortcomings in the transaction monitoring system resulted in trillions of dollars in transactions not being properly monitored. The Financial Crimes Enforcement Network's order also documented the bank's failure to file accurate and timely reports on suspicious transactions worth more than $5 billion.
The risks the bank failed to mitigate and report included activity by Chinese money laundering networks, according to the Financial Crimes Enforcement Network. The failures also extended to illicit financing risks along the southwestern U.S. border. In the sanctions case handled by the Office of Foreign Assets Control, the approximate total value of transactions associated with the apparent violations was $14,834,082. The agency classified those violations as non-egregious in determining their treatment under the settlement. But it said most of the violations were not voluntarily disclosed, a characterization that accompanied its announcement of the settlement of the bank's potential civil liability.
The actions follow an earlier cease-and-desist order issued against the bank by the Office of the Comptroller of the Currency in December 2024. That order sought to address deficiencies in the lender's anti-money laundering program. Under the Financial Crimes Enforcement Network's order, the bank must subject its final revised approach to monitoring suspicious activity to effectiveness testing. The order set October 2027 as the baseline deadline for starting that testing as part of the bank's mandated remediation requirements. The order allows the deadline to be extended with the Financial Crimes Enforcement Network's approval, subject to its stated conditions.