US fines Bank of America $1.2bn for money laundering, sanctions violations
The second-largest US bank faces record penalties for failing to comply with sanctions and money laundering laws. The US Treasury Department has imposed more than $1.21 billion in penalties against Bank of America, the...
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A significant story is unfolding on the international scene. The second-largest US bank faces record penalties for failing to comply with sanctions and money laundering laws. The US Treasury Department has imposed more than $1. 21 billion in penalties against Bank of America, the second-largest bank in the US, for violating anti-money laundering and sanctions laws.
The fines announced on Tuesday include the third-largest penalty in the department’s history, the US Treasury said in a statement. “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,” US Treasury Secretary Scott Bessent said. He added that these “actions send a clear message that even the biggest financial institutions are not above the law”.
The Details
According to the Treasury Department, the Financial Crimes Enforcement Network (FinCEN) assessed a $1. 2 billion penalty over the bank’s failure to mitigate and report “priority national security risks, including Chinese Money Laundering Networks and illicit finance along the southwest border”. The failures identified by FinCEN involved deficiencies related to the bank’s suspicious transaction identification and reporting and customer due diligence processes.
According to the statement, “the Bank effectively outsourced to third parties a substantial portion of its proactive detection and reporting obligations”. “Bank of America failed to timely report to FinCEN over $5 billion dollars in suspicious transactions”, the Treasury said in the statement. The Office of the Comptroller of the Currency (OCC) assessed a $750 million fine, the largest in its history, for the bank’s deficient and ineffective anti-money laundering compliance programme.
2 billion penalty includes credit for the OCC fine. The Office of Foreign Assets Control (OFAC) also announced an $11. 6 million settlement agreement over apparent violations of numerous sanctions programmes, including on Iran, Russia, narcotics and global terrorism.
The development has drawn wide international attention, with diplomatic circles watching closely.
