The US Treasury Department has imposed a substantial $1.2 billion penalty on Bank of America for alleged breaches of anti-money laundering (AML) and sanctions laws. This enforcement action, announced on Tuesday, October 14, 2026, represents the third-largest penalty in the Treasury Department's history.
According to the Associated Press, the Financial Crimes Enforcement Network (FinCEN) assessed the $1.2 billion fine due to Bank of America's failures in mitigating and reporting critical national security risks. These risks specifically included activities related to Chinese money laundering networks and illicit finance along the southwest US border.
Treasury Secretary Scott Bessent emphasized the gravity of the situation, stating, "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 US financial system to significant illicit finance risks." He added that the actions send a clear message that "even the biggest financial institutions are not above the law."
Details of the Penalties
- The $1.2 billion penalty includes $750 million designated for the US Office of the Comptroller of the Currency (OCC), marking the largest fine ever imposed by the federal banking regulator.
- Bank of America "admits that it wilfully violated" the Bank Secrecy Act of 1970, which mandates banks assist the government in detecting and preventing money laundering.
- Additionally, Bank of America settled for $11.6 million with the Treasury's Office of Foreign Assets Control (OFAC) over apparent violations of various sanctions programs, including those targeting Iran, Russia, narcotics trafficking, and global terrorism.
Bank of America's Response and Broader Context
In response to the penalties, Bank of America issued a statement acknowledging its responsibility. "Financial crime compliance is serious, and we are responsible for getting it right," the bank stated. It further noted that it has "invested billions of dollars in technology and dedicated thousands of employees to combat financial crime" and is committed to addressing the issues raised by regulators.
This action against Bank of America follows other significant enforcement penalties under the Biden administration's focus on combating money laundering. It ranks behind a roughly $4 billion settlement with cryptocurrency exchange Binance in 2023 and an approximately $3 billion settlement with Canada-based TD Bank in 2024.
The Binance settlement notably led to its founder and CEO, Changpeng Zhao, receiving a four-month prison sentence for allowing criminals to use the platform for illicit money movement linked to child sexual abuse, drug trafficking, and terrorism.