BofA Fined $1.2 Billion by US Government for Failing to Police Suspicious Activity

3-line summary

• The US Treasury Department fined Bank of America approximately $1.21 billion — the third-largest penalty in Treasury's history — for failing to report over $5 billion in suspicious transactions, including $1 billion tied to national-security-related financial crime risks, according to Investing.com. BofA will book a $1.2B pre-tax charge in Q3, cutting EPS by about 17 cents.
• The Office of the Comptroller of the Currency separately imposed a $750 million civil penalty — its largest ever — citing a deficient transaction-monitoring system that delayed suspicious activity reports on billions of dollars in transactions and calling the bank's compliance program "deficient and ineffective." OFAC added an $11.6 million fine for sanctions violations.
• Regulators found more than 400 suspected sanctions violations, including mishandled payments tied to Russia- and Iran-related sanctions programs, and said the bank over-relied on law enforcement inquiries rather than internal controls. The penalties follow a 2024 OCC cease-and-desist order and come days after American Express paid $350 million for similar anti-money-laundering failures.

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