Bank of America (NYSE: BAC) shares were down 2.3% in early post-market moves on Tuesday after the US Treasury fined the bank more than $1.2bn. The second-largest US bank, which runs consumer banking, wealth management and investment banking, was penalised for anti-money-laundering and sanctions failures.
The fall came after a weak regular session, which ended at $53.96, down 1.14%, before the news. The announcement first appeared shortly after the 4pm New York close. The shares are 13.9% below their close on the 11th of September and 16.7% below their August closing high of $64.81.
Treasury put the total at about $1.21bn. The main piece is a $1.2bn assessment from FinCEN, the Treasury bureau that enforces the Bank Secrecy Act, the US anti-money-laundering law. It includes a $750m penalty from the OCC, the national bank regulator, the largest it has imposed. That is credited against the figure rather than added. A further $11.6m settlement with OFAC, the sanctions office, covers 475 apparent violations. The total is the third-largest in Treasury’s history.
FinCEN said Bank of America admitted wilfully violating the act and failed to report more than $5bn of suspicious transactions, over $1bn of them tied to national-security risks. The penalties follow a December 2024 cease-and-desist order, a binding order to fix specific failings, and the OCC said the bank had not made enough progress.
Bank of America said its third-quarter results will include a non-tax-deductible charge of $1.2bn, about 17 cents a share. Analysts’ consensus earnings per share for the quarter is $1.11, against $1.06 a year earlier.
Treasury Secretary Scott Bessent framed the action as a message to the industry.
Today’s actions send a clear message that even the biggest financial institutions are not above the law.
Scott Bessent, US Treasury Secretary
Jonathan Gould, the Comptroller of the Currency, who heads the OCC, called the bank’s response to its deficiencies unacceptable. The bank must also have an outside party review previously undetected suspicious transactions.
Results are due tomorrow before the US market opens. It is unclear whether the $1.11 consensus already includes the charge.
