The United States Treasury has fined Bank of America (BoA) over $1.2 billion for failing to meet anti-money laundering and sanctions requirements. This is the largest penalty ever imposed by the Office of the Comptroller of the Currency (OCC), which supervises BoA, and ranks among the three largest in the history of the Treasury.
Treasury determined that, from 2018 to 2025, the bank willfully neglected fundamental Bank Secrecy Act requirements. BoA’s anti-money laundering program was inadequate, and it significantly delayed filing Suspicious Activity Reports. Regulators described a pattern in which revenue considerations took precedence and compliance resources were constrained, allowing suspicious activity to remain unexamined for prolonged periods.
Consequently, the bank failed to report more than $5 billion in transactions in a timely manner. Over $1 billion of that volume involved elevated national-security risks, including activity consistent with Chinese money-laundering networks, fraud schemes, and trade-based movements with a clear connection to the southern border. Treasury noted that the bank did not promptly flag suspicious activities, including patterns consistent with Chinese money-laundering networks, such as large wires to China, unusual credit card activity, and trade-based schemes.
The fine imposed on BoA is part of the U.S. Treasury’s broader effort to combat Chinese money-laundering networks, which have emerged as a principal channel for moving proceeds generated by Mexican cartels, including those trafficking fentanyl.
These networks typically pair U.S. cash from drug sales with Chinese clients seeking to transfer funds abroad despite Beijing’s capital controls, which generally limit individuals to $50,000 per year. A cartel-linked broker receives the dollars in the United States and, using WeChat, matches them with a Chinese customer. The customer then sends the equivalent amount in yuan, plus a fee, into an account controlled by the network inside China.
In exchange, the customer or a relative gains access to the corresponding U.S. dollars already sitting at an American bank. The yuan that remains in China can be used to purchase fentanyl precursor chemicals or Chinese-made goods that are shipped to Mexico, sold, and converted into funds for the cartels. Former Justice Department official Craig Timm has described these networks as one of the principal global methods for laundering illicit funds.
As Secretary Scott Bessent stated: “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.”
Bank of America is not the first major financial institution to fail in its duty to protect the nation’s economy and national security. In 2024, TD Bank’s U.S. unit agreed to more than $3 billion in penalties after pleading guilty to Bank Secrecy Act violations and conspiracy to commit money laundering. Prosecutors noted that Chinese networks had moved hundreds of millions through TD, including one group that handled roughly $653 million, “consisting of narcotics and other illicit proceeds.” Some employees reportedly accepted small gifts to overlook deposits.
Bank of America’s delayed filing of Suspicious Activity Reports, along with similar failures at TD Bank, demonstrates how errors by large financial institutions can undermine efforts to combat illicit activity. When the nation’s second-largest bank fails to investigate or report significant volumes promptly, it offers narcotics trafficking organizations a reliable, high-volume channel for laundering money, while undermining the U.S. government’s ability to use financial tools, such as sanctions, asset freezes, and correspondent-banking pressure to isolate trafficking networks.
While TD Bank and Bank of America failed to promptly report suspicious transactions linked to Chinese money-laundering networks, a recent OCC review found that these banks, along with seven other major U.S. institutions, restricted or terminated relationships with conservative organizations, religious groups, and certain lawful businesses based on political or religious views.
In one instance, TD raised objections to a pandemic-relief loan for a nonprofit after the Southern Poverty Law Center labeled the group a “hate group” because of its stance on immigration. The organization later withdrew the application. Bank of America exited relationships with private-prison and detention-center customers during the Biden administration, citing reputational risk tied to shifting policy attitudes, only to seek reengagement with a similar customer months into the subsequent administration — an episode the OCC characterized as political “whipsaw.”
Separately, an FBI whistleblower has stated that, after Jan. 6, 2021, Bank of America supplied the bureau with a list of customers who had used its cards in the Washington, D.C., area around that date. Despite having undergone no legal process, the bank maintained the step was consistent with its Bank Secrecy Act obligations.
The contrast is difficult to ignore and points to a consistent misallocation of compliance attention. Large banks applied scrutiny to politically disfavored but lawful customers while permitting substantial volumes of activity linked to fentanyl proceeds and other illicit networks to go unreported for years. When institutions of this size treat viewpoint-based reputational concerns as higher-priority risks than sophisticated money-laundering channels that move billions for cartels, the outcome is more than a compliance failure. It misallocates resources and leaves the financial system more vulnerable to economic and national security threats that will ultimately affect all of us.
