Bank of America fined US$1.2bn

Bank of America has been fined US$1.21 billion by US regulators for widespread failures to detect potential money laundering and other illicit activity, a penalty the bank said will hurt third-quarter earnings. The US Treasury Department said the fine, the third-largest in department history, is due to the bank's failure to report more than US$5 billion in suspicious activity to the government, including US$1 billion that posed national security-related and other priority illicit finance risks. "Financial institutions are on the front lines of protecting our economic and national security," Treasury Secretary Scott Bessent 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." The Treasury said the bank "prioritised its revenues" in building compliance programmes, and overly relied on inquiries from outside parties like law enforcement and other financial institutions instead of its own internal controls. The consent order requires Bank of America to hire an independent third party to review past transactions, identify suspicious activity that the bank failed to detect at the time, and report those transactions to FinCEN. "Financial crime compliance is serious, and we...