Bank of America hit with $1.2bn fine for money laundering failings

What the report says

Bank of America has been fined $1.2 billion by US authorities over failures to detect and report suspicious activity linked to possible money laundering and sanctions breaches, according to BBC World News. The Treasury Department said the bank did not properly flag more than $5 billion in suspicious transactions, including activity that may have involved Chinese money-laundering networks and trade-based schemes with links to the US southwest border.

The settlement, announced in Washington, includes penalties from the Office of the Comptroller of the Currency and the Office of Foreign Assets Control. Treasury officials said the bank relied too heavily on tips and inquiries from outside organizations rather than building strong enough internal controls, and that it had willfully violated the Bank Secrecy Act by failing to maintain a compliant anti-money-laundering program, carry out due diligence on foreign correspondent accounts and file required suspicious activity reports.

Bank of America said it was working to complete remediation steps required by regulators and that the charge would affect its third-quarter results. The bank said the expense would reduce net income by about 17 cents per share. The case matters because regulators say failures at a large lender can expose the wider financial system to illicit finance risks. More generally, large US banks have faced continued scrutiny over anti-money-laundering controls and sanctions compliance in recent years.